The rural market is going to do better this year as well since demand is growing with better kharif sowing and normal monsoon in most parts of the country, a top official at Maruti Suzuki India (MSIL) said.

Till July, the company has sold 2,01,487 vehicles in the rural areas and 2,67,884 units in urban areas in terms of retail sales, with a rural penetration of 43 per cent and a growth of more than 41 per cent.

Keeping pace with urban

“The rural market growth is similar to the urban market so far this year. Although the penetration for rural for MSIL is around 42.5 per cent, since monsoon has been normal in most parts of the country, I would expect rural to give good numbers this year also, keeping pace with the urban growth,” Shashank Srivastava, Senior Executive Officer (Marketing and Sales), MSIL, told BusinessLine.

Rural retails sales had recorded a 1.5 per cent y-o-y growth at 5,91,854 unit as against 5,83,363 units in FY21 — rural penetration at 43.6 per cent. However, urban sales were down 9 per cent y-o-y to 7,66,630 units (8,42,253).

Hatchback rules

In terms of segments, Srivastava said the demand for hatchback cars (like Alto, S-Presso, WagonR, Swift and Baleno) is still higher in rural areas than SUVs compared to the urban. The demand for CNG variants is also almost negligible in rural since CNG pumps have not yet penetrated there, he said.

When asked about the festival demand, Srivastava said, “In July and August, we have been seeing the highest-ever demand, which could not have been possible without the actual production. So, the capacity utilisation of the plants are between 93 and 95 per cent.”

In July, MSIL produced 1,79,972 units of vehicles across all its plants compared with 1,67,825 units in the year-ago period.

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