TVS Minor Project

7/29/2019 TVS Minor Project

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CHAPTER 1

INTRODUCTION


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Introduction

In view of the increased competition due to globalization and the expansion ofeconomy, all industries need to constantly add more attributes and featureswhich consumer want in two-wheeler. In this context companies have to adoptmore innovative and consumer friendly attributes so that their product should bemore popular among the customer.

1.1 Evolution of Indian two wheeler Industry

The two-wheeler industry in India has been in existence since 1955. It consistsof three segments viz Scooter, Motorcycles, and Mopeds. The increased salesvolume of this industry is proof of its high growth.

In 1971 sales were around 0.1 million units per annum. Butby 1988 the figure had risen to 3 million units per annum. Similarly capacity ofproduction have increased from 0.2 million in seventies to more than 4 millionin the late nineties.

(1960-69)

The automobile industry being classified as one of important under the IndustryPolicy Resolution of 1948 was therefore controlled and regulated by thegovernment. In order to encourage manufacturing besides restricting imports ofcomplete vehicles, automobile assembler firms were phased out by 1952 andonly manufacturing firms allowed to continue production of automobile waslicensed; which meant that a firm required a licensing approval in order to opena plant.

It also meant that the government determined afirms capacity of production. During this period collaborations with foreignfirms were encouraged.

(1970-80)This was a period during which the overall growth rate of the two-

wheeler industry was high. Furthermore, the levels of restriction andcontrol over the industry were also high. The former was the result of the


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steep oil price hikes in the year 1974 following which two-wheeler

became popular of personal transport because they offered higher fuelefficiency over car.

(1981-90)

The technological backwardness of the Indian two-wheeler industry was one ofthe reasons for the initiation of reforms in 1981. Foreign collaborations wereallowed for all two-wheelers up to an engine capacity of 100cc. Between 1974-79 sales of two-wheeler increased by 60%, while that of cars declined by 21%

and jeeps grew only by 11%. Indian motorcycles in the seventies had twomajor drawback viz-low fuel efficiency and high weight. Worldwide however,there was a trend towards using high strength, low weight materials for variouscomponents that resulted in vehicles that were compact and lower weight.

(1991- 1999)

The reform that began in the late seventies underwent their most significantchange in 1991 through the liberalization of the economy. The two-wheelerindustry was completely deregulated. In the area of trade, several reforms wereintroduced with the goal of making Indian exports competitive. The two-wheeler industry in the nineties was characterized by an increase in the numberof brands available in the market, which caused to compete on the basis of fuelefficiency improved by (60-100)% in the new vehicles. In the seventiesMotorcycle mileage was on an average between 25 to 50 kmpl. For Mopeds itimproved from 50 to 80 kmpl. Output of the engine also increased from 3-4 hpto 10hp per 100cc.

In the Motorcycle segment, the new 100cc modelscompared well against the existing heavier models of 250cc, as they werelighter and more fuel-efficient.

1.2 Some Interesting Facts About Two Wheeler Industry

In India,


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India is second largest manufacturer and producers of two-wheeler in theworld. It stands next only to Japan and China in terms of the number ofthe two-wheeler produced and domestic sales.

Indian two-wheeler industries have made beginning inearly fifties when automobile products of India started manufacturingscooters in the country.

In 1948 Bajaj auto began trading in imported Vespa scoops and three-wheelers.

In the initial stage, automobile product of India dominated the scootersegment; it was later overtaken by Bajaj auto limited. Although variousgovernment, private enterprises entered the fray for scooter.

Under the regulated regime foreign companies were not allowed tooperate in India. It was a complete seller market with the waiting period

of getting a scooter from Bajaj auto being as high as 12 years.

The Motorcycles segment was no different with only three manufacturersviz Enfield, Escorts and Ideal Jawa were two stroke bikes. While Enfieldand Rajdoot were four stroke.

With the availability of fuel efficient, low power bikes, demand swelledresulting in Hero Honda then the only producer of four stroke bikesgaining o top slot.

In 1990 the entire automobile industry saw a drastic fall in demand. Thisresulted in a decline of 15% in 1991 and 8% in 1992, Barring HeroHonda, all the major producers suffered from recession in 1993 and 1994.Hero Honda showed a marginal decline in the year 1992.


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1.3 Change in manufacturing view & strategy of two wheeler

market

Till 1990, the two wheeler Industry was mainly dominated by metal bodygeared scooters and the number of producers were less than five. Thisoligopolistic market structure has changed with the entry of lighter, 100 CCmotorcycles. This has resulted a shift in the consumers preference from

scooters to Motorcycles. India is considered as the second largest manufacturerof two wheelers in the world. The two wheeler segment in India can be

classified in to three major segments-Scooters, motor cycles and mopeds.During the year 2000-01, the sale of motor cycles crossed 48 per cent where asthe sale of Scooters have receded.

This shift in demand and sales position in the two wheeler segment maycontinue. As a result of this, the sale of Scooter segment is expected to fallfurther and the sale of motor cycles will go up further. This trend has alsoinfluenced the production strategy of major two wheeler-manufacturingcompanies. The expansion plans adhered by Bajaj Auto, LML and TVS have

given more stress to the motorcycle segment. With the incremental capacityaddition of these companies, there will be an estimated production of 2.20million vehicles by the year-end of 2001-2002. There will be a correspondinggrowth in the demand for Motor cycles. This segment is expected to grow at anaverage of 22 per cent in the year 2001-2002.

Changing strategy of two wheeler market

Changing product portfolio: In the past two years, Bajaj Auto hassuccessfully revamped its strategy to emerge as the number two player inmotorcycles. From a company that was predominantly a scooter andthree-wheeler manufacturer, Bajaj Auto now derives nearly half of itsrevenues from motorcycles (14% in FY01). Going forward, the company

plans to introduce models that will cover the entire price spectrum. Thisinitiative should continue to fuel growth.

Growth potential : In the last ten years, the two-wheeler industry hasgrown at a CAGR of about 10%, which we expect to continue in the longterm. Motorcycle demand would be primarily driven by replacement

demand, upgradation, affordable credit and introduction of motorcycles inthe utility segment (just to put things in perspective, bank rate has come


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down from 10.5% in FY98 to 6.25% in 1HFY03). With its 'Boxer' range,

Bajaj Auto has already established itself in the entry-level motorcyclesegment. It is now set to tap the sub Rs 30,000 category, which is likelyto be the growth engine for the future.

Kawasaki partnership : Bajaj is in the process of developing a '125cc world bike' based on Kawasaki's technology platform, which isslated for a 4QFY03 launch. Kawasaki intends to utilise Bajaj'sfacilities as a global outsourcing base for the 125 cc bike, particularlyfor South East Asian markets. If successful, this could push toplinegrowth of the company into a new trajectory over a period of time.

Changing demographic profile : Studies by research agencies likeThe National Council for Applied Economic Research (NCAER) onIndian households puts forth the latent growth potential for the two-wheeler industry. As per the study, the consuming class that wasestimated at 17% of total households is expected to touch 46% by.Poor urban transport infrastructure, urbanisation, rising double incomefamilies and robust growth of the services sector offers good long-term growth prospects for lead players like Bajaj Auto

Competition : Given the long-term growth potential of the motorcyclesegment, existing manufacturers expanded their capacities while new

players have tied up with transnational companies to tap the localmarket. Hero Honda triggered a price war in 1QFY03 with a specialdiscount and other players followed suit. If demand fails to meetcapacity expansion, industry will suffer in the near-term.

Scooters losing sheen : Bajaj also has presence in segments likegeared scooters and step-thrus that are losing out to trendier and fuel-efficient motorcycles and ungeared scooters While the companyexpects demand for scooters to stabilise, there is a strong possibilitythat low-end motorcycles will continue to eat into the scooter segment.Since this division is the cash cow for the company, as sales contract,margins will come under pressure.

Equity exposure : Bajaj Auto, traditionally, has had a high exposureto stock markets. The company's total investment of surplus funds in

FY02 was Rs 22 bn, a rise of 38% YoY. Of this, investment inequities (including equity mutual funds) amounted to Rs 8.5 bn, an


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18% rise YOY. Given the volatility in stock markets, this is a cause of

concern. Despite huge surplus funds, the company's dividend payoutratio has also been lower historically (27% in FY02).

Margin pressure : As the product profile changes in favor ofmotorcycles, margins are likely to come under pressure. This is

because, going by industry standards, the company enjoys bettermargins in scooter and 3 wheelers than it does in the motor cyclesegment.

Bajaj limited, with a capacity of 2.3 m vehicles, had a 28% marketshare in the two-wheeler segment in FY02. The company hastraditionally been a key player in the geared scooter segment. But theshift in consumer preference towards motorcycles had caught thecompany unawares. However, over the last two years, Bajaj fought

back with a slew of new motorcycle launches that have met withsuccess. This has resulted in the company gaining about 23% of themotorcycles market share in FY02, up from 16% in FY00. Thecompany's sales mix (in volume terms) consists of 30% gearedscooters, 48% motorcycles and the rest from step thrus, ungeared

scooters .


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1.4 Two Wheeler Manufacturers in India

The major players in the two wheeler industry are

1. BAJAJ2. HERO HONDA3. T V S4. YAMAHA5. HONDA


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1.5 Automobile Market in India

The Indian automobile industry is the tenth largest in the world with an annualproduction of approximately 2 million units. Indian auto industry, promises tobecome the major automotive industry in the upcoming years and the industryexperts are hopeful that it will touch 10 million units mark.

Indian automobile industry is involved in design, development, manufacture,marketing, and sale of motor vehicles. There are a number of global automotivegiants that are upbeat about the expansion plans and collaboration withdomestic companies to produce automobiles in India.

The two-wheeler manufacturers in India are Honda Motorcycle & Scooter India(Pvt.) Ltd., TVS, Hero Honda, Yamaha, Bajaj, etc. The heavy motors including

buses, trucks, auto rickshaws and multi-utility vehicles are manufactured byTata-Telco, Eicher Motors, Bajaj, Mahindra and Mahindra, etc.

1.6 Market Share

Among the two-wheeler segment, including scooters and mopeds- motorcycleshave- major share in the market. Hero Honda contributes 50% motorcycles tothe market in which Honda holds 46% share in scooter and TVS makes 82% ofthe mopeds in the country. In the three wheeler industry in India, Piaggio holds40% of the market share. Bajaj is the leader by making 68% of the three

CHAPTER 2


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2.1 TVS Motor Company Ltd.: History

1982

- The company was incorporated as Indian Motorcycle Pvt. Ltd. on 15th July.Its name was changed to Indo Suzuki Motorcycles Pvt. Ltd. and it wasconverted into a public limited company on 12th January, 1984. It was

promoted by Mr. N. Krishnan in collaboration with Suzuki Motor Co. Ltd.Japan; Sundaram-Clayton, Ltd., a member of the Company to the extent of Rs70 lakhs.

- The company entered into a technical know-how and assistance agreementwith Suzuki Motor Co. Ltd., of Japan on 22nd September. As per the terms ofthe Collaboration, Suzuki agreed to furnish complete technical information andknow-how, trade secrets and other data.

- All shares taken up by promoters etc. 1984

- The company received a letter of intent for the manufacture of 20,000 sparkignition operated out board motors and 30,000 internal combustion sparkignition engines upto 500cc per annum.

- 59,40,000 shares issued at par in 1984. 7,00,000 shares allotted to SundaramClayton, Ltd. Chennai, 70,000 shares allotted to Anusha Investments (P) Ltd.Chennai, 20,00,000 shares allotted to Suzuki Motor Co., Ltd., Japan; 2,20,000shares allotted to employees and business associates and 29,70,000 shares

offered to the public. 1985

- A new company "Lakshmi Auto Components Pvt Ltd." was incorporated forthe manufacture of critical engines and transmission parts. 1986

- The company acquired the assets of the moped division from SundaramClayton Ltd. The cost of acquisition was met partly by rights issue of equityshares. The company subscribed to 39,20,000 equity shares of Rs.10 each ofLakshmi Auto Components Pvt Ltd, whereupon it became a subsidiary of thecompany.


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- The name of the company was changed from Indo Suzuki Motorcycles Ltd. to

TVS Suzuki Ltd with effect from 18th August.

- The technical aid agreement entered into with Suzuki Motor Co., Japan whichexpired in August 1991 was extended for three more years with the approval ofthe Government of India.

1992

- The Company launched two new models of motor cycles viz. `Sumurai' and`Shogun'.

1993

- The Company launched a new model of moped viz. `TVS Scooty'.

1995

- The Company was studying the feasibility of opening a second plant at adifferent location to meet the growth in demand for two wheelers in the nearfuture. It also proposed to introduce upgraded version of mopeds. In addition,during the year, the Company undertook to develop new models ofmotorcycles.

1998

- TVS Suzuki Ltd, one of the leading two-wheeler manufacturers in the country,has crossed the Rs.1,000-crore turnover mark in 1997-98.

- TVS will be the first company in the country to introduce the 4 stroke scooter

in the Indian market.

2003

-TVS Motor Company has recorded a market share of 35% from motor cyclesdivision

-K.S.Bajpai has been appointed as an Additional Director on the Board.

-TVS, Bajaj Auto and Yamaha have grabbed the market share from the

country's largest motor cycle maker Hero Honda.


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-TVS Motor Company Ltd has introduced its own racing bikes which Team

TVS will test on the tracks in Asian Circuit.

- -TVS Motor Chairman and MD Venu Srinivasan has been selected inBusiness Week's Stars of Asia which covers the top 25 achievers in thecontinent.

-TVS Motor Company adds two new models in two-wheeler segment.

-TVS Motor ties up with State Bank of India for scooter and Motorcyclefinancing.

-Launches Fiero F2 and Scooty Pep models

-Board of approves the merger of engine components division of its subsidiary,Lakshmi Auto Components (LAC) with TVS Motors effective from April 2,2003

2004

-TVS Motor , on Jan 5 launched Centra, a 100 cc four-stroke motor cycle, withvariable timing intelligent (VTI) engines, claiming to give more mileage toconsumers. The Centra has bundled price, style, power along with fuelefficiency making it a fill-once-a-month bike, and it's priced at Rs.36,990.nearly Rs 100 crore investment had gone into the launch of 'Centra', includingR&D, plant and machinery.

-TVS Vice President resigns

-TVS Motors forges alliance with Andhra Bank

-TVS picks up Asian Network for Quality award

-TVS unveils new version of 'Victor GX'

2005

-TVS Motor Company introduced its entry-level 4-stroke motorcycle - TVSStar - in the Kerala market

-TVS Motor Company launches TVS Centra VT-i, a variant of its four-stroke


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100cc model TVS Centra on May 6

-TVS Motor rolls out two motorcycle variants named Victor EDGE, StaR Cityand Scooty Pep plus

2009

- TVS Motor Company launched Scooty Streak, which is its latest scooterettetargeted at girls of 16 to 20 age group.

- Tvs Motor Company Limited has appointed Mr Prince Asirvatham as an

additional and independent director of the board of directors of the companyeffective April 21, 2009.

- TVS Motor Company entered the 110 cc segment by unveiling 2 brand newproducts, an auto-clutch motorcycle and an automatic scooter.

2010

- TVS Motor Company has launched India's first auto-clutch motorcycle- TVSJive, in Chandigarh.


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2.2 THE TVS GROUP

Axles India Limited

Axles India is promoted by Wheels India and Sundaram Finance, with technicalsupport and equity participation from Dana Corporation, USA. Incorporated in1982, the company provides axles for the entire range of medium and heavycommercial vehicles, including Pressed Axle Housings, Drive Axle Housings,Trailer Axle Beams, Hub Reduction Axle Housings and Drive Heads. Thecompany has a manufacturing capacity of 180,000 Pressed Axle Housingsannually.www.axlesindia.com

Brakes India LimitedBrakes India was founded in 1962 as a joint venture between TV SundramIyengar & Sons and Lucas Industries, UK. The company manufactures brakingequipment for automotive and non-automotive applications. Besides exporting

products to 35 countries worldwide, Brakes India caters to over 60% of thedomestic OEM market. Some of its manufacturing sites have been assessed atISO 14001, ISO 9002, TS 16949 and QS 9000. The foundry division hasreceived the prestigious Deming prize and award for TPM excellence. Salesturnover for the year 2004-05 was Rs 9,720 million (US$ 221 million).www.brakesindia.com

Delphi-TVS Diesel Systems Limited

Delphi-TVS is a joint venture between Delphi Corporation, USA and T.V.Sundaram Iyengar & Sons, India. The company manufactures Diesel FuelInjection Equipment for Cars, Sports Utility and Multi Utility Vehicles, LightCommercial Vehicles, Tractors, Single & Two Cylinder engines. Delphi-TVS
http://www.axlesindia.com/http://www.axlesindia.com/http://www.brakesindia.com/http://www.brakesindia.com/http://www.brakesindia.com/http://www.axlesindia.com/


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believe that its success is based on the solid foundation of customer satisfaction,

continuous innovation and total employee involvement. The company has atrack record of sustained growth since it was set up. Delphi-TVS have obtainedISO/TS 16949 and ISO 14000 certifications. The company has now won theJIPM TPM Excellence Award (first category). To meet increasingly stringentemission norms, Delphi-TVS has upgraded its technology and introduced new

products. Mechanical Rotary Technology has been upgraded to ElectronicRotary Technology and Delphi-TVS and has now introduced thestate-of-the art-Common Rail Technology with full authority electroniccontrols.

www.delphitvs.com

Harita TVS Technologies Limited

Formed in 2001, Harita TVS provides Engineering Design Services tocustomers across US, Europe and India. With core competencies in Automotive,Industrial Machinery and Energy & Networking, it has become a preferred

partner to many OEM and Tier-1 customers. The company offers end-to-endsolutions for next generation products with its Mechanical Design Services(MDS) & Electronic Design Services (EDS). With a service portfolio coveringthe entire spectrum of a typical NPI (New Product Development) process,

backed by strong engineering background of the TVS Group, Harita

India Japan Lighting Private Limited

India Japan Lighting Pvt. Ltd. was incorporated in December 1996. It is a 50:50joint venture between Lucas-TVS Limited, Chennai, and Koito ManufacturingCompany Limited, Japan. The company manufactures headlamps, rearcombination lamps and various other signal lamps for automotive applications.The headlamps and rear combination lamps are aerodynamically styled and

represent the state-of-the-art technology. The Company has introduced state-of-the-art clear plastic lens, multi-focal reflector headlamps with auto leveling
http://www.delphitvs.com/http://www.delphitvs.com/http://www.delphitvs.com/


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European standards. Sales turnover for 2004-05 was Rs.210 million (US$ 4.8

million).

Lucas Indian Service LimitedLucas Indian Service Limited (LIS) was established in 1930 and is a sales andservice company for auto electrical and fuel injection equipment. LIS is a fullyowned subsidiary of Lucas-TVS Limited and markets auto components for the

replacement market. Its preventive service product, Lucas Care, is designed todeliver a problem-free driving experience. LIS has a country-wide network of2000 authorised sales and service dealers. Its manufacturing facility at Chennaimakes ignition coils and switches. Turnover for 2004-05 was Rs 1,350 million(US$ 31 million).

Lucas-TVS LimitedLucas-TVS was established in 1961 as a joint venture between Lucas, UK andT V Sundram Iyengar & Sons, to manufacture automotive electrical systems.Today, the company is a leader in the auto electrical field 3 out of 4 vehiclesin India are fitted with Lucas-TVS products. The company addresses segmentsacross the auto industry, like passenger cars, jeeps, utility vehicles, lightcommercial vehicles, medium and heavy commercial vehicles, off-highwayvehicles, industrial engines, earth movers, tractors and two / three wheelers. Italso provides solutions for stationary and marine applications. Lucas-TVS is a

TS 16949 and ISO 14001 certified company and has bagged the Demingapplication prize (2004) from the Japanese Union of Scientists and Engineers(JUSE). Turnover in 2004-05 was Rs 6,300 million (US$145 million).www.lucas-tvs.com

Southern Roadways Limited

Southern Roadways was founded in 1946 as a road transport and parcel servicecompany. Today, it runs a parcel service with a fleet of more than 300 trucks
http://www.lucas-tvs.com/http://www.lucas-tvs.com/http://www.lucas-tvs.com/


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and covers 60,000 kms a day through Tamil Nadu, Karnataka, Andhra Pradesh,

Kerala and Pondicherry.

Sundaram Brake Linings LimitedEstablished in 1974, Sundaram Brake Linings (SBL) is a pioneer in themanufacture of asbestos-free friction material in India. Distinguished by itsfocus on cutting-edge technology, the company has a strong presence in the

Indian OEM and aftermarket and exports to over 60 countries. SBL is a ISO /TS 16949 and ISO 14001 certified company. It is the first friction materialmanufacturer in the world to win the coveted Deming Application Prize forTotal Quality Management. SBL is successfully positioned to meet the growingneed for friction materials for the automotive industry.

Sundaram-Clayton LimitedSundaram-Clayton Limited (SCL) is a pioneering manufacturer of air brakesystems. The market leader in this space, the company exports quality spare

parts to over 15 countries. The SCL-Brakes division is the first Indian companyto manufacture the next generation Anti-Lock Braking System (ABS) and Anti-Spin Regulation (ASR), both of which have been developed with in-housedesign technology. It is also the first company in India and the fourth companyoutside Japan, to win the prestigious Deming Award. The companys Die-casting division has evolved from being a captive supplier to a full-service

supplier of aluminium components to Indian and multinational companies.

Sundram Fasteners LimitedIncorporated in1966, Sundram Fasteners Limited (SFL) is the largestmanufacturer and exporter of high tensile fasteners in India. SFLs product

range includes high tensile fasteners, powder metal parts, cold extruded parts,

iron powder, radiator caps, gear shifters and automotive pumps / assemblies.Principal supplier of radiator caps to General Motors, USA, SFL has won the


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prestigious Supplier of the Year award from GM for five consecutive years.

The automotive pumps and assemblies division is the principal supplier ofrocker-level assemblies to Cummins, USA for ISX and ISM platforms. Withfacilities in Chennai, Madurai, Pondicherry, Hosur, Hyderabad and China, SFLwas the first Indian company to get ISO 9000 certification. Today, all itsdivisions are ISO / TS 16949 and ISO 14001 certified. Turnover for 2004-05was Rs 10,370 million (US$ 235 million).www.sundram.com

Rubber division

TVS Rubber, the rubber division of SIL, manufactures moulded rubber productsfor vehicle manufacturers, system manufacturers and other industries, includingdefence, electrical, electronic, mining, thermal and white goods. TVS Rubberalso serves the OEM and aftermarket in USA, Europe and other countries, on aJIT basis. It has a technical tie up with Bridgestone, Japan for the manufacture

of Anti Vibration Mountings. It has achieved ISO / TS 16949: 2002 certificationand received the TPM Excellence Award from JIPM, Japan in 2004.www.tvsrubber.com

Tyre solution divisionSince its foray into retreading in 1943, SIL has been the market leader with a

complete spectrum of tyre care solutions. It has acquired unique technology torecycle rubber waste from Levgum, Israel. The company has won awards forthe best retreads from the International Tire And Rubber Association, USA.

Sundaram Textiles LimitedSundaram Textiles was formed in 1960 to manufacture 100% cotton and

synthetic yarn. It has two units: one in Tirunelveli District and another inMadurai. These units have 47000 spindles and 720 rotors.Currently, the
http://www.sundram.com/http://www.sundram.com/http://www.tvsrubber.com/http://www.tvsrubber.com/http://www.tvsrubber.com/http://www.sundram.com/


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company exports more than 50% of its production to countries in Europe,

Middle East

Turbo Energy LimitedIncorporated in 1982, Turbo Energy Limited (TEL) is a technical and financial

joint venture between KKK Germany, (presently BorgWarner Turbo SystemsBWTS), Brakes India Limited and Sundaram Finance Limited. TELmanufactures turbochargers for internal combustion engines. Its state-of-the artmanufacturing facility has the capacity to manufacture, test and assemble350,000 turbochargers per annum. TEL is a QS 9000 certified company and isunder certification for TS 16949 : 2002. The companys exclusive R&D centre

at Chennai has been recognised by the Department of Science and Technology,Govt. of India since 1985.

TVS Automotive Europe LimitedTVS Automotive Europe Limited is a joint venture between TV SundramIyengar & Sons Limited and John Bruce UK Limited. The company is a singlesource for high quality automobile / engineering products for its OE / Tier 1 and2 customers in UK and Europe. Products are sourced from QS / ISO certifiedsuppliers located in India, China, Taiwan and Thailand.

TVS Auto Parts Private LimitedTVS Auto Parts is a 65:35 joint venture between TVS Lanka and WorldwideTrade Agencies of Sri Lanka. The company distributes spare parts across theisland nation and is also an indentor of parts for Indian made vehicles operating

in Sri Lanka.


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ZF Electronics TVS (India) Private LimitedZF Electronics TVS (India) Private Limited (Formerly TVS Cherry PrivateLimited) is a joint venture between TVS Group, India and ZF ElectronicsCorporation, USA (a group company of ZF Friedrichshafen AG, Germany) tomanufacture precision snap action switches, sensors and electromechanical

assemblies in India.

TVS CJ Components LimitedTVS CJ Components sources high quality automobile / engineering productsfrom TS / QS / ISO certified suppliers located in India, Turkey and Italy for OE/ Tier 1 and 2 customers in UK. It has a marketing office in UK and ISO

9001:2000 certified sourcing and back office operations in India. Customersinclude leading companies like CNH, Cummins, Perkins and Delphi.

TVS Electronics LimitedTVS Electronics Limited (TVS-E) is a leading player in the information andcommunication technology market. Its mission is Taking IT to the Heart of

India.

TVS Interconnect Systems LimitedTVS Interconnect Systems Limited commenced operations in 2000 and offersoptimised solutions to the telecommunications and enterprise networkingindustries. Supported by a manufacturing base at Madurai, the company has

four broad divisions: wireless solutions, carrier solutions, enterprise solutions


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and project management services. TVS Interconnect combines best-in-class

solutions and products from a wide variety of globally acclaimed partners.

TVS Lanka Private Limited

TVS Lanka Private Limited is a 50:50 joint venture between TVS & Sons andUnited Motors Lanka Limited. Based in Colombo, TVS Lanka is the authoriseddistributor and dealer for the TVS range of two wheelers and has grown to

become the second highest seller of two wheelers in Sri Lanka. It is supportedby a network of approximately 500 dealers for sales, service and parts

TVS Logistics Iberia S.L.TVS Logistics Iberia (TVS LI) is a 51:49 joint venture between TVSAutomotive Europe and Transcoma Group of Spain. The company sources high

quality automobile / engineering products from TS / QS / ISO certified suppliersin India, China, Taiwan and Thailand for OE / Tier 1 and 2 customers in Spain.

TVS Logistics Services LimitedTVS Logistics Services Limited provides comprehensive logistics solutions tothe automotive industry. These include inbound logistics, outbound logistics,warehousing and value added services like line feeding, high sub-assembliesand SCM consultation.

TVS Logistics SIAM LimitedTVS Logistics Siam Limited is a joint venture between Thai Martin Trading


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Company Limited, Thailand, Tyvin International Company Limited, Thailand

and TVS. TVS brings to the table its rich domain expertise in supply chainmanagement and will extend and apply this to the Thai auto industry.

TVS Sewing Needles LimitedTVS Sewing Needles Limited was established in 1962 as a joint venture withThe Singer Company, USA. The companys initial product range comprised just

two types of needles manufactured with milled groove technology. Today, it hasa licensed production capacity of 100 million needles of 45 different types(household and industrial grade), which are manufactured with die-press eyerounding technology.

TVS Srichakra Limited

TVS Srichakra Limited is the largest auto ancillary group in India. Thecompany is a leading manufacturer of automotive tyres and Indias premier two-wheeler tyre manufacturer (7million tyres annually). It serves its loyal customer

base through a 2050 strong dealer base and 20 warehouses in India. Thecompany also exports to USA, Europe, Africa, South America and South EastAsia. ISO 9001 and ISO 14001 certified, TVS Srichakra has a robust R&D,testing and manufacturing infrastructure.

Wheels India LimitedWheels India Limited was established in the early 60s, as a joint venture

between TVS and Dunlop UK. It is a leading manufacturer of automotivewheels and supplies to all major vehicle manufacturers in the country. Thecompany has a collaboration with Titan, the world leader in off-highway vehiclewheels. It produces wheels for all vehicle categories including passenger cars,utility vehicles, trucks, buses, agricultural tractors and construction equipment


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2.3 BRIDGESTONE TVS

2.3.1 BRIDGESTONE AGENCIES

No.615, Rajkumar Road,Prakash Nagar, Bangalore560 021

Established in 1987 Bridgestone Agencies is one of the 7 Main Deparship outlets out of the

seven in Bangalore.

A Main dealership deals with(i) Vehicle sales(ii) Spare sales(iii) Services (postsales)

Distribute vehicle to 8 subdealers in Bangalore Working hoursMonday to Saturday 9 am to 6pm

Sunday off

Bridgestone Agencies employs around 60 employees on a daily basic.

Receive vehicle from production plants in Mysore & Hosur 3-4 times aweek depending upon the demand.

2.3.2 ORGANISATIONAL STRUCTURE :


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2.3.3 COMPANY PORTFOLIOS :

1. Spares Section

It undertakes the sales of spare parts of the vehicles.

Proprietor

()Mr.Sharath Reddy

Administrator

(Mr.Ravi)

Spares Incharge

(Mr.Jayprakash)

Employees

Service Manager

(Mr.Shivanandiah)

Service Avisor

(Mr.Guru)

Supervisor

(Mr.Manjunath)

Employees

Pre-Delivery

InspectionManager

Godown Incharge

accounts ManagerSales Manager

(Mr.Murli)

Asistant Manager

(Mrs.K.V.Shalini)

Sales Executives


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2. Sales section

It is the main purpose the sales of the vehicles i.e., their product itincludes giving information for agencies and followup of the customer.

3. Cash sectionReceived of cash from the customers for the product/ service.

4. Deliver section

Deals with delivery of vehicles, it includes post sales feedback after 15days of sales.

5. Insurance section

Deals with the insuring of the vehicle, this is optional for customers.

6. R.T.O. SectionThis undertakes completion of all the registration and legal formalities.

7. Company Accounts

Deals with the preparation of the day to day accounts & the preparationof the balance sheet.

8. Finance section

This is the customer oriented finance i.e., the loan part of the sales. (Loanapprovals & sanctions)

9. A.S.C

Authorized service center meansDistribution of the vehicle to the sub dealer coming under the framework of the main dealership.

10. Service Section

This involves with the post sales service. The sub- sections under this are(i) Billing(ii) Cash(iii) Delivery section(iv) Customer follow ups

11. Exchange SectionExchange of vehicle to buy a new vehicle, the vehicle exchanged can beof any broad and will be volved at its market price.

12. Stock (Godown)

It has a well maintained stock of around 250-300 vehicles in stock alltime.

2.3.4 SALES :


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It starts from the time a customer enters the showroom and does an exit. His enquiries are attended by giving him all the information needed by

him and till he is satisfied all his doubts are attended to and the salesexecutives make she they leave customers doubt closed.

These are 2 possibilities of the response of the customer(i) He books a vehicle

(ii) He is in a confused state of mind as to which vehicle to buy.

If he books the vehicle he pays an booking amount of Rs.1,000/- and signsthe duly field in forms and pays the rest of the amount as per his comport.

If he is in doubt, the sales executives give him a PERFORMA INVOICEwhich is an estimate of the vehicle cost and also a purchase giving himdetails of the vehicle and also take the customers details and his preferenceso as to make a followup on a future date.

2.3.5 PROCEDURE FOR LOAN APPROVAL :

1. Filling an application form2. Loan approval by the finance company3. Submitting the essential documents required for loan approval like(i) Address Proof(ii) Age Proof(iii) Bank statement(iv) Income certificate / PAN card photocopy(v) 5 passport size photographs(vi) Blank cheques


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4. PAN Documents+ 2 days to issue releasing order from financiers / banks.+ 1 More day to deliver the vehicle.

The customer who do not pay their installment are called as defaulters /duplicate customers

Formula used in loan calculations :

Few formula used in the loan calculation

EMI = (Loan Amount) x (Rate of Interest) x (No.of years) x (Loan amount)

(No of months)

D/P = (Loan Amount) x (Processing Fees) + (Advance EMI) + (Margin money)+ (Charges) + (Stamping charges).


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CHAPTER 3

RESEARCH METHODOLOGY


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3.1 METHODOLOGY OF STUDY

1 Statement of research studycomparative study of sales of two wheelers of various markercompetitors.

2. Objective of the research methodology

To find out the maximum market stage acquired by each player in themarket and also finding the maximum sales by each of them.

3. Scope of research study

- It would help the companies know where they stand in the market.

- It would give them a slight hope for improvement and work better.

4. Statistical tools used for research

Secondary date has been used for the research purpose the sores ofsecondary date are

(i) Websites(ii) Magazines

(iii) Company annual reports

5. Limitation

The date used is secondary therefore is very close to the accurate valuesbut not perfect.

CHAPTER 4


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RESEARCH DESIGN

4.1 MARKET SHARE

Market

share in

2007

Market share

in 2008

Market Share in

2009Hero Honda 42.4 38.5 36.1


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T V S 30.2 32.8 35.5

Bajaj 28.7 21.9 24.3

Table 4.1

ANALYSIS :

*Hero Honda has 42.4% market share in 2007, 38.5% in 2008, 36.1% in 2009

*TVS has 30.2% market share in 2007, 32.8% in 2008, 35.5% in 2009

*Bjaj has 28.7% market share in 2007, 21.9% in 2008, 24.3% in 2009

Figure 4.1

INTERPRETATION

0

5

10

15

20

25

30

35

40

45

Market share in

2007

Market share in

2008

Market Share in

2009

Hero Honda

T V S

Bajaj


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*It is seen that hero Honda has been the undisputed market leader ,but its

market share annually has been decreasing

*TVS has a increasing market share annually , going on its path to success*Bajaj is not consistent in the market


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4.2 SALES

Sales in 2007 Sales in 2008 Sales in 2009

BAJAJ 28.7 21.9 24.3

YAMAHA 14 13.6 15.9

HERO

HONDA 42.4 38 36

TVS 11.3 13.5 17.3

Table 4.2

ANALYSIS :

*Hero Honda has been having the highest sales in the year 2007, 2008, 2009followed by bajaj

*Bajaj made a sales of 28.7% in 2007, 21.9% in 2008, 24.3% in 2009

*Yamaha had a sales of 14% in 2007, 13.6% in 2008, 15.9% in 2009

*Hero Honda had a sales of 42.4% in 2007, 38% in 2008, 36% in 2009

*TVS had a sales of 11.3% in 2007, 13.5% in 2008< 17.3% in 2009


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Figure 4.2

INTERPRETATION :

*TVS sales increase annually where as others are not increasing annually

,therefore being inconsistent

*The sum of annual sales of Yamaha & TVS is equal to annual sales to HeroHonda

0

5

10

15

20

25

30

35

40

45

BAJAJ YAMAHA HERO HONDA TVS

Sales in 2007

Sales in 2008

Sales in 2009


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4.3 PERCENTAGE OF SCOOTERS

Northern Western Southern

Percentage of

Scooters 46 27.5 15.7

Table 4.3

ANALYSIS :

*Northern region has 46% scooters of India

*Southern region has 15.7% scooters of India

*Western region has 27.5% scooters of India

Figure 4.3INTERPRETATION :

* Northern region of India has the highest no. of scooters in India, followed bywestern & southern

0

5

10

15

20

25

30

35

40

45

50

Northern Western Southern

Percentage of Scooters

Percentage of Scooters


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CHAPTER 5

SUMMARY OF FINDINGS, SUGGESTIONS &

CONCLUSIONS


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5.1 The industry

The Indian two-wheeler industry is dominated by three players, Bajaj, Hero

Honda and TVS Suzuki, who account for 80 percent of the total two-wheeler

market. The other players including Kinetic Engineering, LML and others

account for the remaining 20 percent of the market. The industry can be divided

into three broad segments: Scooters, motorcycles and mopeds. In the scooters

segment Bajaj is the market leader, Hero Honda is the market leader in the

motorcycles segment and in the segment of mopeds, TVS controls the major

chunk of the market.

Indian automobile market, be it the two-wheeler segment, the three-wheeler

segment or the car segment, is yet to come to a stage where all the models are

developed indigenously. For years now, Indian companies have been dependent

on their foreign joint venture partners or collaborators to provide them with the

technical know-how. This trend too is in for a change. Leading the pack in this

arena is Bajaj, which has been successful at designing models in-house. Bajaj's

Saffire and Spirit, have been able to bag the scooter of the year award for 2001

and 2000 respectively. In fact, its Spirit was adjudged the "Indigenous product

design of the year" for the year 2000. The recently launched Pulsar from the

Bajaj stable is yet another home-grown product, albeit in tandem with Japanese

design house, Tokyo R&D. Bajaj has been laying increased emphasis on its

R&D so as to be able to launch new products to tap the markets at all possible

price points. Other companies too are adapting the strategy of designing and

developing products indigenously. TVS's Victor is yet another development in

this direction and this indigenously built model has been a success in the

markets.


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5.2 Traits of consumer durables

In stark contrast to the situation that prevailed in the 1990s, the two-wheeler

industry has now acquired the traits of any other consumer durables industry, of

price wars, celebrity endorsements and ever-increasing sales and other

promotional outgo. In the 1990s, the profit margin of the top companies was not

subject to the kind of strain that is being witnessed in the recent quarters. The

entry of more players into the fast-growing four-stroke motorcycle market has

led to higher competitive pressure for the companies. Earlier, Hero Honda and

Bajaj were the only producers of four-stroke motorcycles. Now, TVS Motor,

Kinetic, LML along with Bajaj and Hero Honda are jostling for space in the

four-stroke market.

This has resulted in an increase in overall expenses, including promotional

costs, for the companies. Apart from the capital expenditure, new product

launches have an inflationary impact on expenses of a recurring nature, such as

sales promotion and staff cost.

The pressure on margins is not fully manifest owing to the cost control and

indigenisation efforts undertaken by two-wheeler companies. Going forward,

the constituents of the two-wheeler industry too would find profit margin being

consistently under pressure once the scope for cost control diminishes. Growth

in volume would the key driver of financial performance even as the scope for

margin expansion wanes.

5.3 Tracking changes more difficult


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Though Bajaj and Honda Motorcycles have been successful, the task of

assessing or anticipating swings and changes in consumer preferences may not

be an easy task. This is borne out in the case of Hero Honda's CBZ and the four-

stroke scooter venture of Bajaj and TVS Motor.

While Pulsar turned out to be a huge hit for Bajaj, Hero Honda's CBZ (launched

much ahead of Pulsar) failed despite possessing similar features. Similarly, both

Bajaj and TVS Motor did not make any progress in their four-stroke scooter

venture. But the latest entrant Honda Motorcycle has enjoyed a huge

success in this segment through the Activa. The inherent difficulty in assessing

and addressing the developments or changes in the industry would mean a

higher degree of uncertainty to the earnings growth of two-wheeler companies.

That the success or failure of even a single product can have a major influence

on the earnings performance would aggravate the uncertainty problem.

Along with these factors, Honda Motorcycle's decision to venture into the

motorcycle market next year could compound the problems for companies such

as Hero Honda, Bajaj and TVS Motor.

ANNEXURE

TVS WEGO


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Kerb Weight (kgs) 108

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BIBLIOGRAPHY

* www.moneycontrol.com* www.tvsmotors.com* www.bajaj.com* www.herohonda.com

* autodrive- MONTHLY MAGAZINE* www.surfindia.com

TVS Minor Project

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