Chinese white goods maker Xinfei Group is targeting the rural areas to propel the company to grow next year amid the challenges brought by the global financial crisis, Shanghai Daily learned yesterday at Xinfei Electric Annual Sales Conference in Zhengzhou, Henan Province.
"The rural areas are expected to lead a sound and sustainable growth in the household appliances industry as farmers are being given subsidies to buy household appliances," said Teo Tong Kooi, chairman of Xinfei. "But it is hard to make a projection amid increasingly fierce competition in the Chinese market as global firms shift from overseas markets, which have been dampened by the fallout of the crisis. The rural market is set to be a major battlefield for electric products makers."
The government's program to give a 13-percent subsidy to farmers to buy household appliances is due to be extended nationwide from February. The Ministry of Finance expects the program to drive up domestic consumption in the rural areas to the tune of 920 billion yuan (US$133 billion) in sales over four years.
Xinfei, the country's second-largest maker of refrigerators and freezers, has won access to all 14 provinces and regions in the second round of the program, which started on December 1, while sales in three provinces under the scheme surged 40 percent this year and accounted for 60 percent of the total sales in rural areas.
The firm, partly owned by Singapore's Hong Leong Asia Ltd, will revamp its portfolio next year, and more than 80 percent of new products will be aimed at the high-end market in first and second-tier cities to avoid price wars in the low-end segment.
(Shanghai Daily December 15, 2008)
