Yamaha turns to rural areas to continue growth

Two-wheeler maker Yamaha on Sunday said it aims to double sales in rural market within the next five years and plans to add about 1,000 outlets in sub-urban and remote areas of the country by 2014.

The wholly owned Indian subsidiary of the Japanese giant Yamaha, which sold 2.2 lakh units in India in 2009, is also expecting its total sales to increase by up to 30 per cent in this year.

'We have so far seen good sales in urban areas, mainly in big cities, due to our image as a premium bike maker. Now, to continue with the growth, and even to further accelerate, we will focus to strengthen our presence in rural areas,' India Yamaha Motor National Business Head Pankaj Dubey told PTI.

The rural two-wheeler market is not penetrated enough and hence offers huge growth potential, he added.

'Currently, about 15 per cent of our total sales come from rural areas and we are targeting to increase it to 30 per cent by 2014,' Dubey said.

To meet its target, the company is also expanding its sales outlet and is planning to open thousands of dealerships with smaller sizes, called 'sub-dealer', in rural areas.

'Currently, we have about 500 sub-dealers and we will add another 1,000 such outlets by 2014,' Dubey said.

The company, at present, also has 430 standard dealerships across the country and it will add about 20 more such outlets in the next five years, he added.

Dubey, however, said the firm would never enter into the production of low-cost bikes, targeting the rural markets.

'We are not entering into the cheap bike (category). Yamaha is a niche and premium bike maker and it will remain like that...Certain sections of the rural areas are now fed up with cheap bikes and they now want some good quality bikes like R15, Fazer and FZ,' he added.

India Yamaha's four prominent motorcycles -- FZ16, FZS, Fazer and YZF-R15 -- are priced between ₹65,000 and ₹98,000.

When asked about the company's target for 2010, Dubey said it is expecting 25-30 per cent increase in sales.

He said the company sold 2.2 lakh units in 2009.

The Indian motorcycle market witnessed over 25 per cent growth during the last fiscal at 73,41,139 units.