Tata Motors is eyeing on robust rural buying to boost sales, as the passenger vehicle industry sees a fall in demand in crucial cities. The conglomerate arranged 500-600 rural sales camps over the last six months, resulting in sales growth of over 10,000 units. Taking a cue, the company is now looking forward to arranging more of similar sales camps.
The automaker plans to open more R outlets, or rural outlets, in addition to hundreds of rural camps being organised presently.
Such rural-focused campaigns are aimed at areas with the great possibility of offering motorised transportation, and places where Tata Motors presently do not have any channel partner or outlet.
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According to Mayank Pareek president of Tata Motors’ passenger vehicle division, "The rural sales are growing faster, the sentiment is very positive and it will be a big thrust area for the future. The rural camps have delivered strong numbers and we will continue to stage over 100 rural camps every month across the country to deepen our access in the country."
The camps work out of a rural area for three days, with major dealers such as battery supplier (Exide), lubricant supplier (Gulf Oil) and tyre supplier (JK Tyre) also involved. Along with space for finance counter, sales platform and a vehicle exchange counter.
For Tata Motors, the hinterlands already account for a third of sales. Its sales in the rural areas swell 38% in the first six months of this fiscal year, quicker than the key cities where the growth was 15-20%.
Even though rising fuel prices, insurance cost and interest rates are impacting urban buying, rural demand is being supported by government’s decision to increase the minimum support price for farm commodities and decent monsoon rains this year.
Tata Motors plans to open more R outlets, or rural outlets, in addition to hundreds of rural camps being organised presently. The automaker has 325 such outlets, which it wants to increase exponentially.
The automaker functions only out of 50,000 of the nation’s 6.5 lakh villages and wants to expand the coverage to 1.5 lakh villages in three years, added Mr. Pareek.