ACKNOWLEDGEMENT

No presentation is the work only of the author. I owe much to the people who have

played significant role in the development of the project . I have immensely benefited

from the comments, observations made by several individuals including Dr. Vishal

jain, Head of Department

My special thanks to Mrs. Maya Lohani(Senior Lect.) & Ms. Swati Verma(Lect.) for

the guidance in preparing this project report.

PREFACE

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This project is the result on “Analysis of four wheeler industry”

Project work is an integral part of the MBA course. This practical experience helps the student to the real business world closely, which in turn widely influences his/her concepts and perfection.

The Marketing play an important role in accomplishing the objectives of the

organization. If the market research is not properly done, the organization will not be able

to accomplish desired results. Therefore organization try to meet the needs of their

consumers as fully as possible to contribute their maximum for the achievement of the

business objective.

The project assigned was Analysis of four wheeler industry. I

personally met all the respondents for getting all the information.

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ABSTRACT

The automobile industry, one of the core sectors, has undergone metamorphosis with thea d v e n t   o f   n e w   b u s i n e s s   a n d   m a n u f a c t u r i n g   p r a c t i c es   i n   t h e   l i g h t   o f   l i b e r a l i z a t i o n   a n d globalization. The sector seems to be optimistic of posting strong sales in the couple of yearsin the view of a reasonable surge in demand. The Indian automobile market is gearing towards international standards to meet the needs of the global automobile giants and becomea global hub.A detailed analysis of Automobile industry has been covered in respect of past growtha n d   p e r f o r m a n c e .   U n d e r   t h i s   p r o j e c t   t o   b e t t e r   u nd e r s t a n d   t h e   I n d u s t r y   w e   h a v e   u s e d Fundamental and Technical tools to make it more authentic n meaningful. An E.I.C approachhas been followed under Fundamental Analysis which covered effect of Recession, the impact of inflation, FDI’s, Export, GDP etc. on Automobile Industry. The Industry Analysishas been done with the help of five forces model, BCG Matrix, SWOT analysis, industry lifecycle and the industry specific index..For Industry Analysis  as a  part of  Fundamental   tool we have undergone with thecomparative analysis of TATA Motors as our leading Industry with Maruti Suzuki India’slargest  Car manufacturer.  The fundamental  aspect  consists  f inancial  and Non-Financialanalysis of  both the Industry.  In the Technical aspect we have considered Share priceanalysis, moving average, moving average crossover, Bollinger bands and M.A.C.D. of boththe Industry by keeping TATA Motors as  our leading Industry.At the  end

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conclusion and recommendations have been specified so as to make the research work more meaningful and purposeful.

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EXECUTIVE SUMMARY

The present study is about the four wheeler industry.The aim of the study is to know the

consumer preference about the various products of four wheeler. Consumers have higher

expectations than ever before. They want products to match these expectations. They also

want accurate, up-to-date and useful information about what they buy. In short,

consumers want the facts. This growth of consumer power is known as consumerism.

In the area of fast moving consumer goods (FMCG), marketing has become a specialized

and complex process. When developing products, organizations try to meet the needs of

their consumers as fully as possible. This is vital if they want to do better than their

competitors. This process of development around the needs of its consumers is called

marketing orientation.

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TABLE OF CONTENTS

1. Introduction of company

a. Product detail, Historical perspective

b. Marketing planning

c. Comparison of market-market share, growth rate

2. Market segmentation Target market

a. Mass marketing strategy

b. Concentrate marketing strategy

3. Marketing Research Sales analysis

a. Types of consumer that constitute the potential market

b. Size & location of market

c. Growth and concentration of market

d. Consumer preference for particular brand

4. Management Decision

a. Pricing policy of company

b. Distribution channel of product Direct marketing Whole seller & retailer

c. Whole seller-Retailer-Customer

5. Sales promotion strategya. Publicityb. Advertisingc. Personal

6. Customer behaviour

a. Product adoption

b. Customer satisfaction

7. SWOT analysisFormulation Implementation & evaluation of market strategy

8. Conclusion

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INTRODUCTION OF FOUR WHEELER INDUSTRY

BIRTH OF THE CAR

The birth of the car as we know it today occurred over a period of years. It was

only in 1885 that the first real car rolled down on

to the streets. The earlier attempts, though

successful, were steam powered road-vehicles.

The first self-propelled car was built by

Nicolas Cugnot in 1769 which could attain speeds

of upto 6 kms/hour. In 1771 he again designed another steam-driven engine which ran so

fast that it rammed into a wall, recording the world’s first accident.

In 1807 Francois Isaac de Rivaz designed the first internal combustion engine.

This was subsequently used by him to develop the world’s first vehicle to run on such an

engine, one that used a mixture of hydrogen and oxygen to generate energy.

This spawned the birth of a number of designs based on the internal combustion

engine in the early nineteenth century with little or no degree of commercial success. In

1860 thereafter, Jean Joseph Etienne Lenoir built the first successful two-stroke gas

driven engine. In 1862 he again built an experimental vehicle driven by his gas-engine,

which ran at a speed of 3 kms/hour. These cars became popular and by 1865 could be

frequently espied on the roads.

The next major leap forward occurred in 1885 when the four stroke engine was

devised. Gottileb Damlier and Nicolas Otto worked together on the mission till they fell

apart. Daimler created his own engines which he used both for cars and for the first four

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wheel horseless carriage. In the meanwhile, unknown to them, Karl Benz, was in the

process of creating his own advanced tri-cycle which proved to be the first true car. This

car first saw the light of the day in 1886.

The season of experiments continued across the seas in the United States where

Henry Ford began work on a horseless carriage in 1890. He went several steps forward

and in 1896, completed his first car, the Quadricycle in 1896. This was an automobile

powered by a two cylinder gasoline engine. The Ford Motor Company was launched in

1903 and in 1908 he catapulted his vehicle, Model T Ford to the pinnacle of fame.

Continuing with his innovations, he produced this model on a moving assembly line, thus

introducing the modern mass production techniques of the automobile industry.

The modern car, therefore comes from a long list of venerated ancestors, and its

lineage will, hopefully

ADVENT OF CARS IN INDIA

From the singsong rhythm of the bullock cart to

the jet-age, India has traveled a long way. An average

Indian’s dream car may not be the design-savvy Honda or

the stately limousine, but he sure can dream, and afford,

the Maruti now.

It was in 1898 that the first motorcar rode down India’s

roads. From then till the First World War, about 4,000

cars were directly imported to India from foreign manufacturers. The growing demand

for these cars established the inherent requirements of the Indian market that these

merchants were quick to pounce upon.

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The Hindustan Motors (HM) was set up in 1942 and in 1944, Premier

Autobackmobile (PAL) was established to manufacture automobiles in India. However, it

was PAL who produced the first car in India in 1946, as HM concentrated on auto

components and could produce their first car only in 1949.

It was left to another company, Mahindra and Mahindra (M&M) to manufacture

sturdier utility vehicles, namely the American Jeep.

In the 50s, the Government of India granted approval to only 7 car dealers to

operate in India - HM, API, ALL, SMPIL, PAL, M&M and Telco. he protectionist

policies continued to remain in place. The 60s witnessed the establishment of the two-

three wheeler industry in India and in the 70s, things remained much the same.

Since the 80s, the Indian car Industry has seen a major resurgence with the opening up

of Indian shores to foreign manufacturers and collaborators.

The 90s have become the melting point for the car industry in India. The consumer is

king. He is being constantly wooed by both the Indian and foreign manufacturers.

Though sales had taken a dip in the first few months of 1999, it is back to boom time.

New models like Maruti’s Classic, Alto, Station Wagon, Ford’s Ikon, the new look

Mitsubishi Lancer are all being launched with an eye on the emerging market.

In these last years of the millennium, suffice it is to say that Indian cars will only grow

from strength to strength.

AUTOMOBILE INDUSTRY – WHEELS OF CHANGE:

India had its date with this wonderful vehicle first time in 1898. Then for the nextf i f t y y e a r s , c a r s w e r e i m p o r t e d t o s a t i s f y d o m e s t i c d e m a n d . B e t w e e n 1 9 1 0 a n d 2 0 ' s t h e a u t o m o b i l e i n d u s t r y m a d e a h u m b l e b e g i n n i n g b y s e t t i n g u p a s s e m b l y p l a n t s i n M u m b a i , Calcutta and Chennai. The import/assembly of vehicles

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grew consistently after the 1920's,c r o s s i n g t h e 3 0 , 0 0 0 m a r k i n 1 9 3 0 . I n 1 9 4 6 , P r e m i e r A u t o m o b i l e L t d ( P A L ) e a r n e d t h e distinction of manufacturing the first car in the country by assembling 'Dodge DeSoto' and'Plymouth' cars at its Kurla plant. Hindustan Motors (HM), which started as a manufacturer  of auto components graduated to manufacture cars in  1949. Thanks to the Licence Raj whichr e s t r i c t e d f o r e i g n c o m p e t i t o r s t o e n t e r t h e I n d i a n c a r m a r k e t , I n d i a n r o a d s w e r e r u l e d b y Ambassador Car from Hindustan Motors and the Fiat from Premier Auto Ltd. for many of theinitial years.In 1952, the GOI set up a tariff commission to devise regulations to develop ani n d i g e n o u s   a u t o m o b i l e   i n d u s t r y   i n   t h e   c o u n t r y .   A f t er   t h e   c o m m i s s i o n   s u b m i t t e d   i t s r e c o m m e n d a t i o n s ,   t h e  G O I   a s k e d   a s s e m b l y   p l a n t s ,   w h i c h   d i d   n o t   h a v e   p l a n s  t o   s e t   u p m a n u f a c t u r i n g f a c i l i t i e s , t o s h u t o p e r a t i o n s . A s a r e s u l t G e n e r a l M o t o r s , F o r d a n d o t h e r   a s s e m b l e r s c l o s e d o p e r a t i o n s i n t h e c o u n t r y . T h e y e a r w a s 1 9 5 4 a n d t h i s d e c i s i o n o f t h e government marked a turning point in the history of the Indian car industry. The GOI alsohad a say in what type of vehicle each manufacturer should make. Therefore, each productwas safely cocooned in its own segment with no fears of any impending competition. Also,n o n e w e n t r a n t w a s a l l o w e d e v e n t h o u g h t h e y h a d p l a n s o f a f u l l - f l e d g e d m a n u f a c t u r i n g   p r o g r a m . T h e r e s t r i c t i v e s e t o f p o l i c i e s w a s c h i e f l y a i m e d a t b u i l d i n g a n i n d i g e n o u s a u t o industry. However, the restrictions on foreign collaborations led to limitations on import of t e c h n o l o g y   t h r o u g h   t e c h n i c a l   a g r e e m e n t s .   I n   t h e   a bs e n c e   o f   a d e q u a t e   t e c h n o l o g y   a n d  purchasing power, the car industry grew at a snail 's pace in the 60’s. The demand for cars in14

 1960 was to the tune of  15,714. In the next two decades the number increased to 30,989 i.e. aCAGR of only 3.5 per cent.

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INDUSTRY STRUCTURE

Structure:

The Indian Automobile industry can be broadly classified into :

2/3 wheelers

Passenger cars

Commercial vehicles (LCV/MCV/HCV)

UV (Utility Vehicles)

Tractors

The models in the car market can be fitted to different segments as

given below:

Category Models

Economy segment (up to Rs 0.25 mn) Maruti Omni, Maruti 800 etc

Mid size segment (Rs 0.25-0.45 mn) Fiat Uno, Hyundai Santro, Maruti Alto,

Tata Indica etc

Luxury Car Segment (0.45-1mn) Tata Indigo, Honda City,etc

Super luxury segment (above Rs 1mn) Mercedes Benz & other imported models

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T h e e c o n o m y s e g m e n t h a s a v e r y l a r g e f o o t h o l d o v e r

t h e I n d i a n a u t o m o b i l e m a r k e t a s compared to the mid-size

and luxury segment

Segment Market Share (%)

Economy 90.2

Mid size luxury 9.8

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SEGMENTATION OF AUTOMOBILE INDUSTRY

T h e   a u t o m o b i l e   i n d u s t r y   c o m p r i s e s   o f   H e a v y   v e h i c l e s  

( t r u c k s ,   b u s e s ,   t e m p o s , t r a c t o r s ) ;   p a s s e n g e r   c a r s ;   T w o -

w h e e l e r s ;   C o m m e r c i a l   V e h i c l e s ;   a n d   T h r e e -

w h e e l e r s . F o l l o w i n g   i s   t h e   s e g m e n t a t i o n   t h a t   h o w   m u c h  

e a c h   s e c t o r   c o m p r i s e s   o f   w h o l e   I n d i a n Automobile Industry

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EVENTS AND MILESTONES

A behind- the- scenes look into the making of one of India's most vibrant

industries. The landmarks along the way...

1928- The first imported car was seen on Indian roads

1942- Hindustan Motors incorporated

1944- Premier automobiles started

1948- First car manufactured in India

1953- The Government of India decreed that only those firms which have a

manufacturing program should be allowed to operate

1955- Only seven firms, namely, HM, API, ALL, SMPIL, PAL, M& M and TELCO

received approval.

1960 - 1970 - The two, three wheeler industry established a foothold in the Indian

scenario.

1970 - 1980 - Not much change was witnessed during this period. The major factors

affecting the industry were the implementation of the MRTP Act( Monopolies and Trade

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Restrictive Practices Act), FERA (Foreign Exchange Regulation Act) and the Oil Shock

of 1973 and 1979.

1980 - 1990 - The first phase of liberalization was announced by the Govt. -With the

liberalization of the Government's protectionist policies, the advantages hitherto enjoyed

by the Indian car manufacturers like monopoly, oligopoly, slowly began to disappear.

This period is also marked by the entry of a large number of firms in the market. 4

Japanese manufacturers entered the Commercial Vehicle and Two- Wheeler market.

The Government agreed to the demand for allowing foreign collaboration in the

automobile sector

The industry witnessed a resurgence due to major policy changes like relaxation in

MRTP and FERA, delicensing of some ancillary products, broad banding of the products

and modification in the licensing policy. Also, the concessions it gave to the private

sector and the new foreign collaboration policy, all resulted in higher growth and better

performance of the industry than in the earlier decades.

The Government of India tied up with Suzuki Inc. of Japan which produced India's

most successful car- the Maruti.

1991 - Under the Govt.'s new National Industrial Policy, the license raj was dispensed

with, and the automobile industries were allowed to expand freely.

1993 - With the winds of liberalization sweeping the Indian car market, many

multinationals like Daewoo, Peugeot, general Motors, Mercedes-Benz and Fiat came into

the Indian car market.

1997 - The National Highway Policy was announced which will hopefully have a

positive impact on the automobile industry. The Government also laid down the emission

standards to be met by car manufacturers in India in the coming millennium. There were

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two successively stringent emission levels to be met by April 2000 and April 2005,

respectively. These norms were benchmarked on the basis of those already adopted in

Europe, hence the names Euro I (equivalent to India 2000) and the Indian equivalent of

Euro II.

1999 - The Hon’ble Supreme Court passed an order directing all car manufacturers to

comply with Euro I emission norms (India 2000 norms) by the 1st of May, 1999 in

National Capital Region(NCR) of Delhi. The deadline was later extended to 1st June,

1999.

HISTORY OF FOUR WHEELER INDUSTRY

The Indian automobile component industry has finally begun to emerge on its

own. It has begun to take major steps towards making world class Quality Systems by

imbibing the ISO 9000/QS 9000 Quality Systems. Exports have been to the tune of 10%

of output in the last decade.

Exports grew from US$296 in 1995-96 to US$311 in 1996-97. The principal

export items included tractor parts, motorcycle parts, piston rings, fuel injection parts,

radiators, headlamps, auto bulbs etc.

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However, this section has been long neglected and does not get the due it deserves.

We end these lacunae by putting up a whole segment on this important industry. read on

about details on the major auto parts, their dealers, the places they are manufactured...

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MAJOR PLAYER IN FOUR WHEELER

Bajaj Auto Daewoo Motors Eicher Motors Ford

General Motors

Hero Honda Hero MotorsHindustan Motors

Hyundai Ind Auto Ltd.Kinetic Engineering

LML

MahindraMaruti Udyog Ltd.

Royal Enfield Telco

TVS SuzukiSwaraj Mazda Ltd.

Volvo DC Designs

These are the companies that bring to us our dream machines. This is where it all

starts from; the bourgeoisie Maruti 800, the upmarket Astra, the stately Mercedes, the

'Indian' Indica, the racy Hero Honda, the Tata truck and the rest.

Wend your way through the automobile companies, their history and product

lines. Find out hitherto unknown facts about the vehicles you use. Did you know that the

Hindustan Motors was the first vehicle manufacturing company to be set up in India?

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And it is the same Hindustan Motors which manufactures both the sturdy Ambassador

and the elegant Lancer, in association with Mitsubishi of course.

We present information on all the manufacturers that are part of the Indian

automobile industry. Make this your one stop auto info bank.

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MARKETING PLANNING

Our employees are our greatest strength and asset. It is this underlying philosophy that

has moulded our workforce into a team with common goals and objectives. Our

Employee-Management relationship is therefore characterised by:

Participative Management.

Team work & Kaizen.

Communication and information sharing.

Open office culture for easy accessibility

To implement this philosophy, we have taken several measures like a flat

organisational structure. There are only three levels of responsibilities ranging from the

Board Of Directors, Division Heads to Department Heads. Other visible features of this

philosophy are an open office, common uniforms (at all levels), and a common canteen

for all.

This structure ensures better communication and speedy decision making processes. It

also creates an environment that builds trust, transparency and a sense of belonging

amongst employees

VISION OF THE FOUR WHEELER COMPANY

The Leader in

The Indian AutomobileIndustry,

Creating Customer Delightand Shareholder's Wealth;

A pride of India.

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Our Core values:

Customer Obsession

Fast, Flexible and First Mover

Innovation and Creativity

Networking and Partnership

Openness and Learning

ASSOCIATIONS

Society of Indian Automobile Manufacturers (SIAM)

The Society of Indian Automobile Manufacturers (SIAM) is the apex national

association representing the Auto Industry...

The Automotive Component Manufacturers Association of India(ACMA)

The Automotive Component Manufacturers Association of India (ACMA), with a

membership of over 365 companies, has been the Indian auto component

industry's spokesman for the last 38 years.

The Western India Automobile Association (WIAA)

The Western India Automobile Association (WIAA) was founded on October 15th

1919 and today is the largest and the oldest motoring body with over forty-eight

thousand members and a network of 7 branches in 4 states of Western India.

Federation of Automobile Dealers Associations (FADA)

This is the first Indian Association formed by the dealer community in January

1964 and signified the urge of India's automobile dealer community to have their

own identity and a national organization of their own.

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Association of International Automobile Manufacturers, Inc (AIAM)

Members of the Association of International Automobile Manufacturers, Inc. (AIAM) distribute world-class passenger cars, multipurpose passenger vehicles, and light trucks in the United States.

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COMPARISION OF MARKETMarket Share of Company & Growth Rate

It is common for automobile manufacturers to hold stakes in other automobile manufacturers. These ownerships can be explored under the detail for the individual companies.

Notable current relationships include:

Daimler AG holds a 20% stake in Eicher Motors, a 10.0% stake in KAMAZ, a 10% stake in Tesla Motors, a 6.75% stake in Tata Motors and a 3.1% in the Renault-Nissan Motors alliance. They are in the process of selling back their 40% stake in McLaren Group. This process will be finalized in 2011.

Dongfeng Motor Corporation is involved in joint ventures with several companies in China, including: Honda, Hyundai, Nissan, Nissan Diesel, and PSA Peugeot Citroen.

Fiat holds a 85% stake in Ferrari and a 20% stake in Chrysler, that can be increased to 35%; with the option of increasing its stake further.

Ford Motor Company holds a 13.4% stake in Mazda and an 8.3% share in Aston Martin.

Geely Automobile holds a 23% stake in Manganese Bronze Holdings.

General Motors and Shanghai Automotive Industry Corporation (SAIC) have two joint ventures in Shanghai General Motors and SAIC-GM-Wuling Automobile.

General Motors and Toyota Motor Corporation have a joint venture in New United Motor Manufacturing, Inc.

Hyundai Kia Automotive Group holds a 38.67% stake in Kia Motors, down from the 51% that it acquired in 1998.

MAN SE holds a 17.01% voting stake in Scania.

Porsche Automobil Holding SE has a 50.74% stake in Volkswagen Group. Due to liquidity problems, Volkswagen Group is now in the process of acquiring Porsche.

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Renault-Nissan Motors have an alliance involving two global companies linked by cross-shareholding, with Renault holding 44.3% of Nissan shares, and Nissan holding 15% of (non-voting) Renault shares. The alliance holds a 3.1% share in Daimler AG.

Renault holds a 25% stake in AvtoVAZ and 20.5% of the voting stakes in Volvo Group.

Toyota holds a 51% stake in Daihatsu, and 16.5% in Fuji Heavy Industries, parent company of Subaru.

Volkswagen Group and FAW have a joint venture.

Volkswagen Group and Shanghai Automotive Industry Corporation (SAIC) have a joint venture in Shanghai Volkswagen Automotive.

Volkswagen Group holds a 37.73% stake in Scania (68.6% voting rights), and a 29% stake in MAN SE.

Volkswagen Group has a 49.9% stake in Porsche AG. Volkswagen is in the process of acquiring Porsche, which will be completed in mid-2011.

Volkswagen Group has a 19.9% stake in Suzuki, and Suzuki has a 5% stake in Volkswagen.

COMPANY EXTERNAL ENVIRONMENT

The Television industry is witnessing a spate of new channels being launched every year. FOUR

WHEELER is also penetrating into the rural areas and is a promising segment. Homes with FOUR

WHEELER s are expected to grow from 112 million to 200 million in a few years.

Current size: Rs 55,800 crore

Projected size by 2010: Rs 84,700 crore

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CAGR: 21%

India boasts of being the third largest television market in the world today. And cable

penetration (pay FOUR WHEELER market) is expected to grow from the present 70

million to all FOUR WHEELER homes. More than 350 channels (paid and free) are

available to viewers in India today.

The fact that 40 per cent households of India are still without television connectivity

highlights the scope of growth in the segment. The majority of the revenue generated in

the television industry is through advertisements, followed by subscriptions. The Indian

television advertisements market is currently valued at about US$ 1,067 million and is

expected to grow at a rapid rate with the increase in the number of channels and the

television viewers. Over the next five years, the subscription revenues are poised to be

the growth driver of the Indian television industry. The number of pay FOUR

WHEELER homes and the increased subscription rates will increase the subscription

revenues. The spread among the lower- income groups is very low and offers a wide

scope for growth. The Indian television industry is currently being dominated by Star

India, which is the top player in the sector at present.

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MARKET SEGMENTATION

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TARGET MARKETING

1. Mass Marketing

2. Concentrate Marketing

INTRODUCTION: - The market for any product is normally made up of several segments. A ‘market’ after all is the aggregate of consumers of a given product. And, consumer (the end user the end user), who makes a market, are of varying characteristics and buying behavior. There are different factors contributing for varying mind set of consumers. It is thus natural that many differing segments occur within a market. In order to capture this heterogeneous market for any product, marketers usually divide or disintegrate the market into a number of sub-markets/segments and the process is known as market segmentation. Thus we can say that market segmentation is the segmentation of markets into homogenous groups of customers, each of them reacting differently to promotion, communication, pricing and other variables of the marketing mix. Market segments should be formed in that way that difference between buyers within each segment is as small as possible. Thus, every segment can be addressed with an individually targeted marketing mix. The importance of market segmentation results from the fact that the buyers of a product or a service are no homogenous group. Actually, every buyer has individual needs, preferences, resources and behaviors. Since it is virtually impossible to cater for every customer’s individual characteristics, marketers group customers to market segments by variables they have in common. These common characteristics allow developing a standardized marketing mix for all customers in this segment. Through segmentation, the marketer can look at the differences among the customer groups and decide on appropriate strategies/offers for each group. This is precisely why some marketing gurus/experts have described segmentation as a strategy of dividing the markets for conquering them.

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MARKETING STRATEGY AND MARKET SEGMENTATION: - When it comes to marketing strategies, most people spontaneously think about the 4P (Product, Price, Place, Promotion) – maybe extended by three more Ps for marketing services (People, Processes, Physical Evidence).

This caselet illustrates the strategy followed by Maruti Udyog Limited (MUL), India’s largest car maker, when confronted with intense competition from foreign players. It highlights the promotional offers undertaken by MUL in its quest for market dominance. The caselet examines how the company aligned itself to the changing market requirements, through promotional offers, and reached out to potential customers. Finally, the caselet throws light on how MUL entered the pre-owned/used car market in India.

However, things changed in the 90’s with the entry of domestic as well as overseas

companies into the automobile market, especially with the entry of Hyundai Motor India

Ltd., the fully owned subsidiary of Hyundai Motor Co., Korea, and Tata Engineering of

the Tata Group. Hyundai's 'Santro' model endorsed by popular actor Shah Rukh Khan

proved to be a major success. This resulted in a sharp decline in the sales volumes of the

Maruti 800

Maruti make his segmentation on the mass basis

BMW was done concentrate marketing

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MARKET RESERCH

THEORY OF RESEARCH METHODOLOGY

This is chapter explain various methods & techniques used in this research study

with their suitability. This part of the research report is very much important because it

explain the methods; concept&procedures followed by the researcher study the problem.

It is helping to the reader to understand whole the easily.

As marketing research does not address itself to basic or fundamental question. It

does not quality as basic research on the country, It tackles problem, which seem to have

immediate commercial potential. In view of this major consideration. Marketing research

should be regarded as applied research. We may also say that marketing research is of

both types-problem solving and problem oriented.

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Marketing research is a systematic and objective study of problem pertaining to

the marketing of goods and service.It may be emphasized that is it not restricted to any

particular area of marketing but is applicable to all its phases and aspects

The American Marketing Association (AMA) has defined Marketing research

follows Marketing research is the function which the consumer, Identify and define

marketing opportunities &problems; generate, refine and Evaluate marketing actions;

monitor marketing performance; and improve Understanding of a market as a process.

Marketing Research specified the information required to Address these issues;

designs the method for collecting information. Managers and Implements the data

collection process; analyses the results; the Communications the findings and their

implications.

RESEARCH DESIGN

“A research design in the specification of methods and procedures for acquiring

the needed information it is the over all operational pattern of frame work of the project

that stipulates what information is to be collected from which sources by what

procedures”

To achieve objectives of my project study I have selected the exploratory research

& also the causal research.

METHOD Of DATA COLLECTION

There are two types of data

Primary data: -

“Primary data is the data which is collected by the research at first hand.”

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Sources

To collect primary data the questionnaire system is uses through market

survey.Structured non disgusisd questionnaire is applied in which question question are

listing in prearranged on paper and where the object of inquiry is revealed to the

respondent I have contected the customer and interviwed them by personally & by

telephones.The analysis of the collected data through questionnaire is given in the later

part of the project.

Secondary data

“Secondary data whether internal or external is the data already collected by others

for propose other then solution of the problem at hand”

Secondary sources are

Internal sources:

Internal guide

(Prof Vasudev Modi)

Sales executive of the Dhru Motors

External sources

Various marketing books

www.maruti udhyog.com

PRE-TESTING

A pre- testing is small-scale replica of the main study. it dresses a rehearsal and

provides guidance on the following matter.

1. The adequacy of the sampling frame to be followed for the survey.

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2. It helps the researcher in selecting the data collection method.

3. It gives prior knowledge about the population to be sampled.

4. The pre0testing helps the researcher in checking the validity of the

questionnaire and in redesigning of the same.

5. It also provides training to the researcher for interviewing.

SAMPLING PLAN

A number of decision & task are include in sampling and it is the procedure required

right from defining a population selection of sample element.

Define the population: -

The population id defined in terms of Element, Sampling units, Extent ,Time

Element: -Owner of Maruti four wheeler

Sampling unit: -Businessman,Professional,salaried,student.

Extent: -Surat city

Time: -15th January to 15th March,2004

Sampling Frame

I have taken whole Surat city as sample frame for conducting research.

Sampling Method

I have used proportionate random sampling to select the respondent from the entire

population

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I have conducted a pilot survey by interviewing 20 respondents.

Select randomly, it is helpful in finalization of the questionnaire and also in knowing

standard error or core element. How this survey has became useful to me in deciding the

sample size

Sample size decision

As the study is related to satisfaction level with reference to surat city.I have taken the

formula as follow:

Where:

p=probability of success

q= probability of failure

z= confidence level

e=Tolerable error

To decide the value of above-mentioned variable. I have analysis the pilot survey and result emerged is

as

ResultNo of

respondentPercentage

Satisfy 15 75%

Dissatisfy 5 25%

Total 20 100%

100% confidence level is not possible because of large size of population. So I have taken

95% confidence to overcome this limit maintain accuracy.

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I have decided to accept 5% error in my sample from the true population mean, as it is

also tolerable by the company. I get the following sample size through the equation

Sample Size N=p*q (z/e) 2

= (0.75)*(0.20)*(1.96/0.05) 2

= 0.75*0.25(39.2)2

= 288.12

300

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MANAGEMENT DECISION

  PRICING STRATEGY - CATERING TO ALL SEGMENTS

Maruti caters to all segment and has a product offering at all price points. It has a car

priced at Rs.1,87,000.00 which is the lowest offer on road. Maruti gets 70% business

from repeat buyers who earlier had owned a Maruti car. Their pricing strategy is to

provide an option to every customer looking for up gradation in his car. Their sole motive

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of having so many product offering is to be in the consideration set of every passenger

car customer in India. Here is how every price point is covered.

Modernization of the Indian Automobile Industry.

Production of fuel-efficient vehicles to conserve scarce resources.

Production of large number of motor vehicles which was necessary for economic

growth

Maruti created history by going into production in a record 13 months.

On 14 December 1983, the then Prime Minister of India, Mrs Indira

Gandhi, released the first vehicle for sale by handing over the keys of a

Maruti 800 to Mr.Harpal Singh of Delhi.

Volume targets were routinely exceeded, and in March 1994, we became the first

Indian company to produce over one million vehicles, a landmark yet to be

achieved by any other car company in India. Maruti is the highest volume car

manufacturer in Asia, outside Japan and Korea, having produced over 4 million

vehicles by April 2003.

Maruti (subsidiary of Suzuki), has made profits every year since inception except

2000-01. In 2001-02, we made a profit (before tax) of Rs 1183 million. In 2002-03, the

profit (before tax) rose to Rs 2821 million, recording a growth of 138.4%over the

previous year.

Maruti revolutionized the way Indians looked at cars. "No other car company so

completely dominates its home market" - (The Economist). MUL is the first and only car

company in the world to lead its home market in terms of both market share and in the JD

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Power Customer Satisfaction study (JD Power Asia Pacific 2000 India Customer

Satisfaction studies). It is also the only car company in the world to be Top ranked four

times in a row (2000, 2001, 2002 & 2003).

Maruti-Suzuki Autocross 2004

In it's 5th year, Maruti-Suzuki Autocross 2004 was organized at Noida from 6th -

8th Feb, 2004. 135 rally enthusiasts participated in the event including 3 women drivers.

The Maruti Suzuki Autocross 2004 may have thrown up its usual share of winners, but

none of the 135 participants lost out on the sheer excitement.

The 1.5 km twin dust tracks comprised of a bridge as a unique feature. With two

cars racing simultaneously, it was sheer excitement to watch one car going over the

bridge & the other under it. The track was designed in such a way that while racing, cars

change tracks automatically & in the next lap the car which had gone over the bridge

goes under it & vice versa. The race was based on best timing in the qualifying & pre-

quarterfinals & elimination procedure in quarterfinals, semi-finals &finals.

Six of the Maruti's models were in the fray -- Baleno, Esteem, Gypsy, Alto, Zen

and Maruti 800. Maruti Zen witnessed max. no. of entries followed by Esteem & Baleno.

Professionals included 6 times National champion & Formula 3 winner N.

Leelakrishnan from Coimbatore, 2003 National Champion Vikram Mathias from Ooty,

Sunny Sidhu - defending champion Maruti Suzuki Autocross 2003 & winner Maruti-

Suzuki Raid-de-Himalaya 2003; Sandeep Sharma, winner Maruti Suzuki Autocross 2002,

Anil Wadia, winner Rally Desertstorm 2003 proved to be the scene stealers in the contest.

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Equally noteworthy is the fact that all models from the Maruti stable negotiated the bends

and the hurdles without much ado.

Another first this year was the 'Race of Champions' where winners of each

category raced on similar stock cars (without any modification).

Maruti-Suzuki Autocross is a close circuit racing on an artificially created track

full of dips, bumps & hairpin bends to test the driving skills of participants. It also

provides a platform for new players to emerge in Motorsports arena.

DISTRIBUTION CHANNEL

India has emerged as one of the world's largest manufacturers of small cars. According to

New York Times, India's strong engineering base and expertise in the manufacturing of

low-cost, fuel-efficient cars has resulted in the expansion of manufacturing facilities of

several automobile companies like Hyundai Motors, Nissan, Toyota, Volkswagen and

Suzuki.[6]

In 2008, Hyundai Motors alone exported 240,000 cars made in India. Nissan Motors

plans to export 250,000 vehicles manufactured in its India plant by 2011. [7] Similarly,

General Motors announced its plans to export about 50,000 cars manufactured in India by

2011.[8]

In September 2009, Ford Motors announced its plans to setup a plant in India with an

annual capacity of 250,000 cars for US$500 million. The cars will be manufactured both

for the Indian market and for export.[9] The company said that the plant was a part of its

plan to make India the hub for its global production business.[10] Fiat Motors also

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announced that it would source more than US$1 billion worth auto components from

India.[11]

According to Bloomberg L.P., in 2009 India surpassed China as Asia's fourth largest

exporter of cars.

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SALES PROMOTION STRATEGY

SALES PROMOTION

It is a process by which awareness is created among consumers. Several method

1. Road Show

2. Advertisement In TV

3. Advertisement In News Papers

4. Hording

5. Through Fee Demos

6. Gifts, discounts and draw system.

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7. Door step service.

8. Exchange offers and exchange bonus.

9. Company events.

10. Demonstration and test ride.

11. Easy and suitable financing scheme.

Attractive interest on advance payment

ADVERTISING ALLOWANCES. An advertising allowance is a dividend paid by a

marketer to a reseller for advertising their product. The money can only be used to

purchase advertising—for example, to print flyers or run ads in a local newspaper. But

some resellers take advantage of the system, so many manufacturers require verification.

A display allowance is the final form of trade promotional allowance. Some

manufacturers pay retailers extra to highlight their display from the many available every

week. The payment can take the form of cash or goods. Retailers must furnish written

certification of compliance with the terms of the contract before they are paid. Retailers

are most likely to select displays that yield high volume and are easy to assemble.

STRATEGIES

Business

In 1998, after a shake-up in the Korean auto industry caused by overambitious expansion

and the Asian financial crisis, Hyundai acquired rival Kia Motors. In 2000, the company

established a strategic alliance with DaimlerChrysler and severed its partnership with the

42

Hyundai Group. In 2001, the Daimler-Hyundai Truck Corporation was formed. In 2004,

however, DaimlerChrysler divested its interest in the company by selling its 10.5% stake

for $900 million.

Hyundai has invested in manufacturing plants in the North America, China, Czech

Republic, Pakistan, India, and Turkey as well as research and development centers in

Europe, Asia, North America, and the Pacific Rim. In 2004, Hyundai Motor Company

had $57.2 billion in sales in South Korea making it the country’s second largest

corporation, or chaebol. Worldwide sales in 2005 reached 2,533,695 units, an 11 percent

increase over the previous year. Hyundai has set as its 2006 target worldwide sales of 2.7

million units (excluding exports of CKD kits). In 2007 it reached 3,961,629 worldwide

vehicle sales—surpassing Fiat, Chrysler, PSA/Peugeot, Nissan, and Honda.

Hyundai motor vehicles are sold in 193 countries through some 5,000 dealerships and

showrooms. After a recent survey of global automotive sales, Hyundai is now the fifth

largest automaker in the world as of 2008.[9][10]

Hyundai Motor Company’s brand power continues to rise as it was ranked 72nd in the

2007 Best Global Brands by Interbrand and BusinessWeek survey. brand value estimated

at $4.5 billion. Public perception of the Hyundai brand has been transformed as a result

of dramatic improvements in the quality of Hyundai vehicles.

43

CUSTOMER BEHAVIOUR

PRODUCT ADOPTION AND CUSTOMER SATISFACTION

44

Findings of the 2009 four-wheeler total customer satisfaction study reveal that the upper

premium compact, midsize and entry luxury car segments have shown the maximum

improvement in delivering customer satisfaction. The study conducted by TNS specialist

division, TNS Automotive, which is the largest syndicated automotive study in India,

representing the responses of more than 8,100 new car buyers. Over 54 models were

covered in the study with customer evaluations taken in the key areas of sales

satisfaction, product quality, vehicle performance and design, after sales service, brand

image, and cost-of-ownership. The TCS index score provides a measure of satisfaction

and loyalty a given model enjoys with its customers.

According to Pradeep Saxena, Senior Vice President TNS Automotive, “In 2009 the

small car segment has seen the entry as well as consolidation of feature laden bigger size

hatchback cars. Consequently the upper-end of compact cars have grown not only in sales

volume but in customer satisfaction as well. Models such as Hyundai i10, Maruti A Star

and Skoda Fabia have contributed to the high satisfaction scores”. At the other end of the

spectrum, the niche entry-luxury segment has the distinction of achieving a score of more

than 100 for all the car models sampled (though the sample for some models is relatively

small). Another segment which has done consistently well is the mid size car segment. In

this segment all the sampled models have achieved a score of 90+ This year the lowest

scoring segment is the diesel small car segment due to a fall in the Tata Indica Diesel

Scores.

Rankings for the TCS study are done at the vehicle segment-level to provide comparisons

among similar groups of vehicles. The models ranking highest in their respective

segments for total customer satisfaction are: Maruti 800 in “Entry Compact”; Hyundai

i10 and Maruti A Star (Jointly) in “Premium Compact”; Skoda Fabia in “Upper Premium

Compact, Maruti Swift Diesel in “Small Car – Diesel”; Maruti Omni LPG in “ Small Car

– Alternate Fuel”; Hyundai Accent Petrol in “Entry Midsize”; Hyundai Verna Petrol in

“Midsize”; Toyota Corolla Altis in “Premium Midsize”; Ford Fiesta Diesel in “Midsize

Car – Diesel”; Mahindra Bolero in “SUV/ MPV”; and Honda CRV in “Premium SUV”.

45

Overall the industry has maintained the score at last year’s level. In line with that, some

traditionally strong models continue to delight their customers. The Maruti 800 continues

to enjoy a very high satisfaction level. Hyundai Accent and Swift Diesel are able to do

much the same and this indeed speaks highly of how these manufacturers have been able

to manage these brands using a holistic approach encompassing product quality, after

sales service and brand image. All of these models have improved their scores over 2008

as well. Overall the Indian car industry has put up a great performance not only in terms

of car sales but also in keeping the customers satisfied with their products and services in

a year which had started on a rather somber note.

TNS Automotive: “Indian car industry puts in a great performance on Customer

Satisfaction too!

 New Delhi, January 4th, 2010… According to the findings of the 2009 four-wheeler total

customer satisfaction study released today by leading market information provider, TNS,

the upper premium compact, midsize and entry luxury car segments have shown the

maximum improvement in delivering customer satisfaction.

The 2009 four-wheeler Total Customer Satisfaction (TCS) study conducted by TNS

specialist division, TNS Automotive, is the largest syndicated automotive study in India,

representing the responses of more than 8,100 new car buyers. This comprehensive study

covers over 54 models with customer evaluations taken in the key areas of sales

satisfaction, product quality, vehicle performance and design, after sales service, brand

image, and cost-of-ownership. The TCS index score provides a measure of satisfaction

and loyalty a given model enjoys with its customers.

According to Pradeep Saxena, Senior Vice President TNS Automotive, “In 2009 the

small car segment has seen the entry as well as consolidation of feature laden bigger size

hatchback cars. Consequently the upper end of compact cars has grown not only in sales

46

volume but in customer satisfaction as well. Models such as Hyundai i10, Maruti A Star

and Skoda Fabia have contributed to the high satisfaction scores”.

At the other end of the spectrum, the niche entry luxury segment has the distinction of

achieving a score of more than 100 for all the car models sampled (though the sample for

some models is relatively small). Another segment which has done consistently well is

the mid size car segment. In this segment all the sampled models have achieved a score

of 90+

This year the lowest scoring segment is the diesel small car segment due to a fall in the

Tata Indica Diesel Scores.

Rankings for the TCS study are done at the vehicle segment-level to provide comparisons

among similar groups of vehicles. The models ranking highest in their respective

segments for total customer satisfaction are: Maruti 800 in “Entry Compact”; Hyundai

i10 and Maruti A Star (Jointly) in “Premium Compact”; Skoda Fabia in “Upper Premium

Compact, Maruti Swift  Diesel in “Small Car – Diesel”; Maruti Omni LPG in “ Small Car

– Alternate Fuel”; Hyundai Accent Petrol in “Entry Midsize”; Hyundai Verna Petrol in

“Midsize”; Toyota Corolla Altis in “Premium Midsize”; Ford Fiesta Diesel in “Midsize

Car – Diesel”; Mahindra Bolero in “SUV/ MPV”; and Honda CRV in “Premium SUV”.

(ANNEXURE 1)

Overall the industry has maintained the score at last year’s level. In line with that, some

traditionally strong models continue to delight their customers. The Maruti 800 continues

to enjoy a very high satisfaction level. Hyundai Accent and Swift Diesel are able to do

much the same and this indeed speaks highly of how these manufacturers have been able

to manage these brands using a holistic approach encompassing product quality, after

sales service and brand image. All of these models have improved their scores over 2008

as well.

47

Overall the Indian car industry has put up a great performance not only in terms of car

sales but also in keeping the customers satisfied with their products and services in a year

which had started on a rather somber note.

CUSTOMER SATISFACTION THEORY :

Whether the buyer is satisfied after purchase depends on the offer’s performance in

relation to the buyer’s expectations.

Satisfaction is a person’s fallings of pleasure or disappointment resulting

from comparing a product’s perceived performance 9or outcome) in relation to his

or her expectations.

As this definition makes clear, satisfaction is a function of perceived

performance and expectation. If the performance falls short of expectations, the

customers, the customer is dissatisfied. If the performance matches the

expectations, the customers are satisfied. If the performance exceeds expectations,

the customers are highly satisfied or delighted.

Many companies are aiming for high satisfaction because customers who are

just satisfied still find it easy to switch when a better comes along. Those who are

highly satisfied are much less ready to switch. High satisfaction or delight creates

an emotional bond with the brand, not just a rational performance. The result is

48

high customer loyalty. Xerox’s senior management believes that a very satisfied or

delighted customer is worth 10 times as much to the company as a satisfied

customer. A very customer is likely to stay with Xerox many more years and buy

more than a satisfied customer will.

There are five major factors, which affected satisfaction of the car namely: -

1. Problems Experienced:

Contributing to 35% of the CSI score, this factor measures the quality of the

car in terms of the number of repair problems that cropped up and how often it

was returned for re-service.

2. Service Advisor:

Which related to ability of the services advisor to ability of the service

advisor to understand the problem and his promptness in attending to the

customer, contributing to 28% of the CSI Score.

3. Service Performance:

Measures the quality of the service performed as well as the dealer’s ability

to fix a problem on the first visit. It has a weightage of 26% in the CSI score

and also considers how easily spare parts are available when required.

4. Service Timing:

Affecting the score by just 6%, this time taken for a service or repair job was

responsible and if the vehicle was ready at the time promised.

5. Facility Appearance: -

49

Deals with the appearance of the customer lounge at the dealership and the

look and cleanliness of the service area. This factors has the least impact CSI

score at Just 5%

SWOT ANALYSIS

50

The diagnosis of a firm’s strengths and weakness can be fruitful only if the

environment factors and market conditions are considered along with the

internal capabilities. This approach essentially involves matching of the

internal capabilities with the environmental opportunities and threat and is

known as SWOT (Strength and Weakness, Opportunities and Threats)

analysis.

TATA

STRENGTHS :

Strength is a resources, skill or other advantage relative to

competition and the needs of markets a firm serves of anticipates serving.

Strength is a distinctive competence that gives the firm a comparative

advantages in the market place.

The key strengths are :

Well trained and highly qualified manpower (both technical & non-

technical).

Hi-Fi and world class technology is available.

Hi class facility, reflecting leadership of top-management.

Financial status of the company is very strong and sound.

51

WEAKNESS :

A weakness is a limitation or deficiency in resources, skills and

capabilities that seriously impedes effective performance .

OPPORTUNITIES:

An opportunity is a major favorable situation in the firm’s

environment. Identification of a previously overlooked market segment,

changes in competitive of regulatory circumstances, technological changes

etc. are examples.

Since, company’s financial profile is quite sound & strong, hence there is

lot of scope to develop.

THREATS :

A threat is a major unfavorable situation in the firm’s environment. It

is key impediment to the firm’s current or desired future positions. The

entrance of a new competitor, slow market growth, major technological

change, appearance if a substitute product are examples.

The danger of being priced out.

The danger of substitution.

The danger of new competition coming.

Inadequate measures viewed against product, market scope.

High level quality and low price should be maintained.

52

MARUTI SUJUKI

Time commitment and Business ethics should be adopted and maintained.

STRENGHTS

o Is globally cost competitive

o Adheres to strict quality controls

o Has access to latest technology

o Provides support to critical infrastructure and metal industries

o Increased awareness among consumers has increased expectations. Thus the

ability to innovate is critical.o Product differentiation via new features, improved performance and after-

sales support is critical.o Increased competitive intensity has limited the pricing power of

manufacturers.

WEAKNESSES

▪ Industry has low level of research and development capability

▪ Industry is exposed to cyclical downturns in the automotive industry

▪ Most component companies are dependent on global majors for technology

OPPORTUNITIES

▪ May serve as sourcing hub for global automobile majors

53

▪ Significant export opportunities may be realised through diversification of export basket

▪ Implementation of Value-Added-Tax (VAT) in FY2004 will negate the cascading impact of prices

THREATS

o The presence of a large counterfeit components market poses a significant

threato Pressure on prices from OEMs continues

o Imports pose price based competition in the replacement market

o Further marginalisation of smaller players likely

OBJECTIVES OF THE PROJECT

The objectives are.

1. To find the mode of pollution by the four wheeler.

2. To find the find which type of four wheeler less pollute.

3. To find the various sources of information about cars from primary data

through customers.

4. To find and analyses the various parameters of increasing four wheeler.

5. To find the what is effect in city life.

54

CONCLUSION

55

In the above research I found that the small four wheeler are more eco

friendly than big car

The mileage of small car are greater than big car so that small car less

polluted than big car.

LPG car pickup is lees than Petrol but in the long drive LPG can provide

more speed than Petrol about 140 km. per hour.

Petrol car is easy to drive in the city because the pick-up of petrol is to

good.

In the above research I found that LPG four wheeler eco friendly for

environment.

56

RECOMMENDATIONS

57

Four wheeler should come out that are attractive and appeals to the

masses.

The traffic congestion short out with small fourwheelers .

Pollution of environment is also control with using of small four

wheeler

LPG four wheeler is also helps to control pollution.

Increasing of four wheelers will be disturbing city life.

58

LIMITATIONS

59

Lack of knowledge of area has also affected the research

Lack of respondents interest to answer the question

It is very difficult to make people understand the significance of

conducting survey.

60

BIBLIOGRAPHY

61

Journals/Magazine :

Advisor of Finance

Search Engine :

Google search engine

Yahoo search engine

Websites :

www.hondacity.com

www.sebigovt.com

www.business-today.com

www.hyundai.com

www.indiaautomobile.com

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