Rural Areas To Have 70% Of China Auto Market

Shanghai, March 12, 2009: (Gasgoo.com) Geely Auto chairman Li Shufu said this week that China's rural market has huge potential for auto sales and the rural areas will account for up to 70% of the Chinese auto market, China Youth Daily reported today.

In its auto sector stimulus plan released earlier this year, the Chinese government has urged auto companies to deliver more of their products to the countryside and will earmark five billion yuan ($732 million) to subsidize farmers buying minivans and sub-1.3-liter minibuses until the end of 2009. This move is expected to help boost China's auto market demand.

Geely Auto, as one of China's largest private automakers, is tapping into the rural market for sales growth. Li said that while Geely vehicles still see their market demand growing in cities, the company has seen bigger potential in the countryside and is expanding its rural sales and service network. Its mobile 4S centers can reach out to remote rural communities.

In the first two months this year, Geely's largest dealership in Bazhou city of north China's hebei province sold 157 units of the Geely Freedom Cruiser model and Geely Vision model. Li said over 70% of the 157 Geely vehicles were bought by farmers. Geely has decided to subsidize rural buyers of its vehicles before the government's subsidy trickles down.

China's rural areas, with about 60% of the country's 13-billion population, have entered a new stage of rapid development and the rural consumer bases are expanding exponentially. China will easily become the world's largest auto market if its vast rural market is fully explored, Li said.

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