Project Work

ON

Automobile Industry

Submitted ByRachit Kaushik Sachin Anand PGFB1335 PGFB1342

Jaipuria Institute of Management A-32 A, Sector 62, Noida -201309

Maruti Suzukis Profile

In early 1980s Indian Govt decided to produce a small car, which would be within buying reach of Indian middle class. The obvious place to shop for technology was Japan, which had developed world class capabilities in small cars by that time. It was not Toyota, or Nissan, or Honda, three largest players in Japan, but Suzuki, a much smaller company with strong capabilities in making small cars. Suzuki grabbed the opportunity with both hands and formed a joint venture with govt. called Maruti Udyog. Maruti Udyog Limited, a subsidiary of Suzuki Motor Corporation of Japan, has been the leader of the Indian car market for about two decades. Its manufacturing plant, located some 25 km south of New Delhi in Gurgaon, has an installed capacity of 3,50,000 units per annum, with a capability to produce about half a million vehicles. Maruti rolled out its 1st car, Maruti 800 with 800cc engine in December 1983. This model targeted at masses and was launched as Peoples car. In early 2003, Maruti Udyog, a joint venture between Suzuki and Indian Govt. dominated Indias automobile market with 54% market share and with annual production capacity of 5lac cars. The company has a portfolio of 11 brands, including Maruti 800, Omni, premium small car Zen, international brands Alto and WagonR, off-roader Gypsy, mid size Esteem, luxury car Baleno, the MPV, Versa, Swift and Luxury SUV Grand Vitara XL7.In recent years, Maruti has made major strides towards its goal of becoming Suzuki Motor Corporation's R and D hub for Asia. It has introduced upgraded versions of WagonR, Zen and Esteem, completely designed and styled in-house. Maruti's contribution as the engine of growth of the Indian auto industry, indeed its impact on the lifestyle and psyche of an entire generation of Indian middle class, is widely acknowledged. Its emotional connect with the customer continuesMaruti tops customer satisfaction again for 8t year in a row according to the J.D. Power Asia Pacific. India Customer Satisfaction Index Study. The company has also ranked highest in India Sales Satisfaction Study.In keeping with its leadership position, Maruti supports safe driving and traffic management through mass media messages and a state-of-the art driving training and research institute that it manages for the Delhi Government.

Hyundai Motors Profile Hyundai Motor India Limited (HMIL) is a wholly owned subsidiary of Hyundai Motor Company, South Korea and is the second largest car manufacturer and the largest passenger car exporter from India. HMIL presently markets 54 variants of passenger cars across segments. The Santro in the B segment, the Getz Prime, i10 and the Premium hatchback i20 in the B+ segment, the Accent and the Verna in the C segment, the Sonata Embera in the E segment and the Tucson in the SUV segment. Hyundai Motor India Ltd, continuing with its tradition of being the fastest growing passenger car manufacturer, registered total sales of 489,328 vehicles in the calendar year (CY) 2008, an increase of 49.6percent over CY 2007. In the domestic market it clocked a growth of 22.4 percent with 245387 units in 2008, while overseas sales grew by 92.5 percent, with exports accounting for 243,931 units in 2008.HMILs manufacturing plant is located near Chennai which has advanced production quality and testing capabilities in the country. In order to provide the Indian customer with global technology, HMIL started its second plant in February 2008 which produces an additional 300,000 units per annum, raising HMIL's total production capacity to 600,000 units per annum. Apart from expansion of production capacity, HMIL currently has 260 strong dealer networks Across India. The production management processes at Hyundai Motor India are overlaid with an organization-wide implementation of manufacturing best practices like Just-in-time inventory management, Kaizen, TPM and TQM, that help us in making the world's best cars, right here in India. Hyundai Motor Company was established in 1967, Hyundai Motor Co. has grown into the Hyundai-Kia Automotive Group which was ranked as the worlds fifth-largest automaker in 2007 and includes over two dozen auto-related subsidiaries and affiliates. Employing over 75,000 people worldwide, Hyundai vehicles are sold in 193 countries through some 6,000 dealerships and showrooms. Hyundai Motor Company, S.Korea, the parent of HMI, has been doing considerable work on sustainable Environment Management. The company has a well defined framework in place for developing products that reduce pollutant emissions and processes for preservation of natural resources and energy along all the stages of the product lifecycle from production, sales, use to disposal and has been awarded the ISO 14001 certification for all its three major plants in Ulsan, Asan and Jeonju in S.Korea.

Cars of HyundaiHyundai deals in wide variety of cars which includes Santro, i10, Getz prime, i20, Accent,Verna, Sonata, Tuscon, etc.

General Motors Profile General Motors is the worldwide leader in car manufacture, with a 17% share in the world auto market. Its products are sold in over 170 countries, and its manufacturing base is spread across 43 countries and its annual production is roughly 83 lakh vehicles. It manufactures a variety of vehicles, like the Chevrolet, Pontaic, Cadillac, Oldsmobile, Opel, Saturn, Geo, Vauxhall, Holden and many more. At the forefront of technological innovations in the automotive sector, General Motors, since its inception in 1908, has always stood a shade above the rest. In 1911, it introduced the electric self-starter, in 1933, developed the front wheel suspension, called the Knee - Action. OVERVIEW OF GENERAL MOTORS INDIA General Motors India, incorporated in 1994 as a 50-50 joint venture company with the C.K. Birla Group of Companies, became a fully owned subsidiary of GM in 1999 when GMOC bought the remaining shares. The company was restructured in 1999 and was converted from a Public Limited company to a Private Limited company. GM currently holds 86 percent of voting shares, and Holden (Australia) holds 14 percent. In India, GM strengthened its presence with new product launches Chevrolet Optra in 2003 and Chevrolet Tavera (Multi Utility Vehicle) in 2004. Similarly in 2006, GM India is expected to register a growth of 90% over 2005. With sales volume going up, the market share of GM India has gone to nearly 3%. The sales volume in 2005 was 25,155 units while 2007 figure is expected to be around 42,000 units. FACILITIES IN INDIAThe existing GM India plant was originally built by Hindustan Motors. In 1994, GM India entered into a 50% Joint Venture partnership with Hindustan Motors and modernized the 45,000-square-meter plant near Halol, 45 kilometers northwest of Vadodara, in the western state of Gujarat. In February, 1999, GM bought the holdings of Hindustan Motors and GM India became a 100% subsidiary of General Motors Corporation of USA. The plant produces the Opel Corsa, Corsa Sail, Chevrolet Optra, and Chevrolet Tavera. The Chevrolet Forester and Opel Vectra are sold as CBUs (Completely Built in Units) and as imported from Japan and Germany.

Major Manufacturers in Automobile Industry and their CarsMaruti Udyog Ltd. :-Cars: - Maruti 800, Omni, Zen, Esteem, WagonR, Swift, SX4, Alto, Ritz, Grand Vitara.Tata Motors:-Cars: - Indica, Indigo Marina, Safari, Sumo, NanoHyundai Motor India Ltd.:-Cars: - Santro, Accent, Sonata, Verna, Getz, Elantra, Tuscon, i10, i20Honda:-Cars: - Honda City, Civic Accord BMW:-Cars: - 3 Series, 5 Series, 6 Series, 7 Series, X3, and X5Other Automobile Companies are:-Skoda, Toyota, Hindustan Motors ,Ford ,Toyota, Mahindra and Mahindra, General Motors, Mercedes

COMMON MARKETING STRATEGIES OF AUTOMOBILE COMPANIESAdvertising in News papers and Magazines:- In this companies advertise about the car in various local newspapers like Economic times and they give detail explanation about the feature of the cars, keeping customers requirement. They also provide various dealers addresses and contact numbers for reference. Company also tries to advertise through various magazines like Auto Cars, Overdrive, etc. Grand Launch :-Recently Tata Nano car was grandly launched and created a buzz in market. After the launch media aggressively took interest in providing the minute details about the car to the customer by showing test drives, etc.Once the car is launched they give adds in every possible newspaper, car magazines, put hoardings, display car models in the malls.Company provides exchange offers to customers:-This is one of the most effective ways adopted by the companies and very successful marketing strategy, which has helped company increase their sales. In this method, companies provide option to buy a new car of your choice in exchange of their old cars, but the price of old car is decided by the dealer by looking at its condition. It helps customers, as they dont need to go anywhere else to sell their old car. This also helps companies to increase their sale of new cars.Adding Star Value to product- Brand Ambassador:-Companies choose brand ambassadors for their cars to reach wide masses. For e.g. Shahrukh Khan promotes Hyundai, Abhishek \Bachan promoted Ford Fiesta, Saif Ali Khan and Rani Mukherjee promoted Chevrolet Aveo and Amir Khan promoted Toyota Innova. Ambassadors give a special identity to the products.Companies have started sponsoring reality shows for better visibility:-As we all know reality shows are making all time big in television and entertainment industry. This is really a smart move by automobile companies to gain visibility through reality shows. The reality shows are aired all over the world and huge number of people watches it. So companies sponsor such shows and get noticed.E.g. Maruti sponsored Indias Got Talent show on Colors channel and gifted Ritz to the winner. Indian Idol winner was also gifted with Maruti SX4.Mall DisplaysVarious companies display their cars in Malls so as to get prime attention. People go in Malls for shopping and hangouts with their friends and family. They conduct small contests and give gift hampers as prize. Thus they try to attract crowd towards them.Companies enter market with help of Film:-In terms of marketing strategies Chevrolet Aveo found a unique way of advertising by way of a Yash Raj Film production, Tara Rum Pum. The main motive behind this was to popularize and promote the product in youth.Companies Sponsor Go- Karting events:-Go-karting events are really booming up among young crowd. And thats the reason we see craze for participating in go-karting events is on high. People have started taking interest in the sport and huge crowds turn up for such events. But for sure car companies would to not like to miss chance of visibility they get in such competitions. Few years before Maruti Suzuki sponsored Autocross rally. Similarly Tata Engineering has sponsored Narayan Kartikeyan as Indias Entry in to the World Series motorcar racing. Personal selling:-Personal Selling largely takes place at the Dealers End. The way customer is attended depends mainly on the Dealer as he acts as an interface between the company and the Consumer. The various cases in which Personal Selling takes place is Individual Sales, Corporate Sales, Sales Presentations, Fair and trade Shows. Mostly in case of Individual Sales the Customer goes to the showroom and takes a look at the product. There he is attended to by the Sales Personnel of the Dealership. Sometimes the Senior Sales Executive has to make Sales Presentation to Corporate Buyers. Personal Selling is also practiced at Trade Fairs and Auto Shows wherein the Company appointed Sales Personnel attend prospective customers and also book their orders

1st Qtr - Maruti Suzuki Ltd.:-46.9%2nd Qtr - Tata Motors Ltd.:-14.6% 3rd Qt r- Hyundai Motor India Ltd.:-13.5%4th Qtr - Mahindra & Mahindra Ltd.:-6.7%5th Qtr - General Motors India Pvt Ltd.:-4.3%6th Qtr - Honda Siel Cars India Ltd.:-3.9%7th Qtr Others:-10.1%

Above market share graph shows us that in automobile industry still Maruti Suzuki is enjoying highest market share. And then comes companies like TATA and Hyundai Motors India Ltd.

Marketing Strategies used by Maruti Suzuki

In earlier days when the market was dominated by only few brands like Ambassador & Premier Padmini, Maruti Suzuki India Limited entered the Indian market with different strategy. The strategy of the company was to offer a compact, modern and fuel efficient car. Maruti released its first Maruti 800 car on 14 December 1983 to fulfill the dreams of Indian customers and became the market leader. Since 1983 till date Maruti Suzuki gradually offered several choices to the consumer. Due to aggressive competitors today Maruti Suzuki believes in Innovative Marketing Strategies. With the changing needs, wants & requirements of customers and markets, Maruti Suzuki is altering their Brand Positioning, Advertising and Distribution strategy.

BRAND POSITIONING STRATEGY OF MARUTI SUZUKI INDIA LIMITED Brand Positioning is the most vital concept in a brands strategy. Brand Positioning is also linked with managing a brands meaning. Today several brand of cars are positioning themselves on the features like Price, Comfort dimensions, Safety, Mileage etc. Currently Maruti Suzuki followed a very effective multi-segmentation strategy to grab the different segments of the market with different versions of its brands. About brand positioning Mayank Pareek says that, Maruti Suzuki believe in research and before launching a product the Maruti team does an extensive research on the needs of the customer. Maruti try to understand the customers demography and psychology to position a brand. Also the company follows the suggestions made by existing customers.

1. Maruti 800

Considering the middle class & small families the Maruti 800 was launched. The car was also targeted at the urban professionals. It was projected as a car with minimum maintenance needs and with greater fuel efficiency. Later the company added some features like MPFI (Multi Point Fuel Injection) technology & few changes in front grill, head light, and rear light. 2. Omni:

Earlier the Omni was known as Van. The van was targeted more at businessman, tourist taxis and large families. It was positioned as a vehicle offering benefits of a car with more space. But due to some different perceptions of consumers regarding van, after some time the van was renamed as Omni and was repositioned as the most spacious car. Recently Maruti Suzuki launched new variant called Omni Cargo which has been positioned as a vehicle for transporting cargo and meant for small traders. 3. Alto:

Maruti launched Alto with tagline Lets Go. In the TVC of Alto, a young married couple goes to different destinations in their Alto. By this TVC Maruti positioned Alto as a car for young people. Also the car has highlighted as fuel efficient car. 4. Wagon R:

Maruti Suzuki launched the Wagon R brand in February 2000. This is one of the successful brand from Maruti portfolio in the premi um segment of compact cars. Wagon R was initially positioned on the basis of the functionality platform. Earlier this car was promoted as a family car with the baseline, Feel at Home. Then as per the changing pattern of market , competition and customers Maruti altered the positioning of Wagon R from Feel at Home to Inspired Engineering to As Interesting as you are and finally to For a Smarter Race. 5. A-Star:

While speaking about A-Star Mr. Shashank Srivastav says that the A-Star was the only car in the Indian market that was targeted at the urban youth. It is about the new generation of Indians who are confident. Also in the second campaign which was done around July 2009, the companys focus was to inform the consumers about the A-Stars K-Series engine. The current campaign of A-Star focuses on self belief and confidence. Considering the fact that self belief and confidence are the attributes of youths, Maruti has positioned A-Star very well. In the current ad campaign a focus has given to a young person who goes for an Interview & with his confidence and self belief he impresses all.

PROMOTIONAL STRATEGY OF MARUTI SUZUKI INDIA LIMITED Every company is it a big or small needs an innovative promotional strategy because promotional campaigns tend to have a huge effect on the reception of the product. Maruti Suzuki India Ltd has a formidable line-up of vehicles in its stable and has been quite aggressive about promoting each of its automobile brands. With an intention to face with cutthroat competition and due to declining market shares, in 2000 Maruti Suzuki cut the prices of few models like Wagon R, Omni and Maruti 800 because Maruti knew very well that the Indian consumer is very sensitive about price & this price cut will definitely beneficial for company. In Jan 2002 to attract the customers, Maruti decided that some of its corporate assets in Delhi including Marutis manufacturing plant and childrens park should be promoted. With an intention to promote road safety and efficient driving the company held carnivals periodically at IDTR. In 2003, to attract the customers Maruti Suzuki launched attractive campaign like Change Your Life. The company also offered vehicle insurance for One rupee only. In this camp aign the customers were asked to write down the chassis and engine number of their vehicles on the entry form and had to answer the question. In this contest the winners were chosen by a draw of lots and were entitled to gifts worth Rs.50 million. In 2004, Maruti introduced the 2599 offer under which by paying an EMI of Rs. 2599 for seven years after a down payment of Rs.40000, a consumer could buy a Maruti 800. In 2004 Maruti introduced the Teacher Plus scheme, in a tie up with SBI. In this scheme the bank offered reduced rates of interest for teachers who were interested in buying a new car. Rural India is a fast emerging as a focus area in the countrys economy. Maruti knew that there is a great potential in rural markets & in rural markets, the endorsements of opinion makers takes precedence over an informed objective Judgment. Considering this fact, Maruti Suzuki launched a panchayat scheme for such opinion makers which covers the village Sarpanch, doctors and teachers in government instititutions, rural bank officers where in an extra discount is given to make a sell. As a part of customer engaging strategy and to attract the potential customers Maruti organized various melas wherein local flavor is added by organizing traditional social activities like Gramin Mahotsava are conducted round the year. As a part of promotional approach Maruti Suzuki promoted Swift & other brands through sponsoring various live programmes (Dancing shows) like Dance India Dance.

ADVERTISING STRATEGY OF MARUTI SUZUKI INDIA LIMITED

Advertising is one aspect of brand building. Whenever Maruti launched any brand, it supported that brand with an ad campaign. Marutis advertising campaigns included TVCs, Radio and Print ads, Point of Sale, Mobile promotions, online marketing, Outdoor promotions. Marutis advertising strategy focused both on building up its corporate image and promoting its cars. Marutis campaigns emphasized different aspects of its cars, including fuel efficiency, looks, space, etc. In the late 1990s, Marutis advertising campaigns were handled by Lowe India (later known as Lowe Lintas & Partners, India) and Rediffusion DY&R. While advertising related to Esteem, Zen and Baleno were handled by Lowe India and the ad campaign of Maruti 800, Gypsy, Omni and Wagon-R were handled by Rediffusion. With an intention to promote the all brands effectively, in 2000 Maruti decided to appoint Capital Advertising. In 2003, Maruti Suzuki came up with an innovative advertising that became popular for its simplicity and clear message. In this ad one child plays with his toy car & when the father asked him, he replies, Kya karoon papa petrol khatam hi nahi hota. This ad depicted the fuel efficiency of Maruti Suzuki.

BRAND RELATED ADVERTISMENTS OF MARUTI SUZUKI INDIA LIMITED

Maruti segmented the customers by designing its brand specific advertisements. The advertising of Maruti was targeted towards the needs and wants of a particular consumer segment. 1. Wagon R

Maruti launched Wagon R in 2000 and launched an ad campaign with the tagline, ]A Car Full of Ideas. In May 2009, Maruti launched an outdoor campaign for Wagon R using billboards, mobile vans, unipoles etc. The outdoor ads of WagonR were placed on 23 outdoor sites in and around airports of several cities across India. In the ads different backgrounds were highlighted and each ad displayed a landmark structure from each city with different messages. For e.g, in Mumbai it was, Welcome to the city of film stars and WagonR, in Hyderabad, the message was Welcome to the city of Charminar & WagonR. 2. Swift

In 2005, Maruti came up with an ad campaign for its new Swift. The ad campaign included print ads, teaser TV ads and a TVC. In the TVC ad a Maruti Swift car being driven by a young couple at high speed on the road without stopping & car stopped only after chased by a traffic police. 3. A-Star

Maruti has always been advertised A-Star with the tagline of Stop at Nothing which shows the attitude that this car has always stood for. In this ad Farhan Akhtar was the brand ambassador during the launch and the launch TVC also shared elements with the Bollywood hit film Rock On to make it more relatable to the young adult seeking an expression for his passion. According to Mayank Pareek, Head of Marketing, Maruti Suzuki India Ltd says that Cyber media is the best Marketing tool. The company has displayed their banners on various internet sites. And due to boom of Cineplexs and Malls, marketing has become easy.

DISTRIBUTION STRATEGY OF MARUTI SUZUKI INDIA LIMITED Distribution is an important marketing mix. In earlier days the consumers used to book for a car and wait for more than a year to actually buy it. Also the concept of Show rooms was non-existent. Even worse thing was the state of the after sales service. With an objective to change this scenario & to offer better service to customers, Maruti took initiative. To gain competitive advantage, Maruti Suzuki developed a unique distribution network. Presently the company has a sales network of 802 centres in 555 towns and cities, and provides service support to customers at 2740 workshops in over 1335 towns and cities. The basic objective behind establishing the vast distribution network was to reach the customers even in remote areas and deliver the products of the company. The company has formed the Dealer territories and the concept of competition amongst these dealers has been brought about. Periodically corporate image cam paigns in all dealership are carried out. In 2003, to increase the competition the company implemented a strategy for its dealers to increase their profitability levels. Special awards were sometimes given by company for sales of special categories. Maruti Suzuki had given an opportunity to dealers to make more profits from various avenues like used car finance and insurance services. In 2001, Maruti started an initiative known as Non Stop Maruti Express Highway. As a part of this initiative Maruti developed 255 customer service outlets along with 21 highway routes by 2001-02. Also with an intention to provide fast service in less time Maruti had offered Express Service Facility. In the year 2008, Maruti had near about 2,500 rural dealer sales executives, among the total 15,000 dealer sales executives.Advertisements:-Good promotional strategy is adopted by Maruti Suzuki to transform its thoughts to the people about its products by marketing through advertisement in television, radio, newspaper, etc. Through radios they try to promote their product by organizing quiz contests and the person who wins are offered special discounts, gift vouchers, coupons, etc. Through television they promote their vehicle by showing the utility value, its comfort level. Some of the strategies used for cars were:-Baleno: Missed the flight catch Baleno The most comfortable Car even in long drives. Esteem: My Daddys Big Car Affordable mid size car Alto: Lets Go The fuel efficient and affordable carAfter Sales Service:- Kya yahan Maruti Service Station hai Availability of service stations even in the remotest place in the country.Display:-If you visit any of the Maruti Dealers showrooms what you will notice is One thing very similar that is the display. They display only 2-3 cars in the showroom. Well this is the strategy to make people concentrate on only few choices otherwise they might get distract and get confused. Here Maruti wins one customer. Tie up with many banks To promote its bottom line growth, Maruti launched Maruti Finance in Jan 02.Prior to the start of this service Maruti had started two joint ventures Citicorp Maruti and Maruti countrywide with City Group and GE Countrywide Today Maruti has tie ups with ABN Amro Bank, HDFC Bank, ICICI Ltd, Kotak Mahindra Bank, Standard Chartered Bank etc.Exchange offers:-Maruti has also placed its step and progress by marketing through exchange offers. In this it makes possible to leave and get it replaced for a new one with barely some amount. This is one of the greatest ways to attract more and more customers and also makes possible to increase sales.

SBI Maruti Car Loans:-The countrys largest bank and the largest car maker have joined hands to make affordable car finance available to more and more people across the country. The mega alliance makes car loans available at lower interest rates to a wider section of people, with transparent terms and conditions. The unbeatable advantages of SBI Maruti car loans:--Two market leaders in their respective industries with trusted brand names.-Low interest rates -No processing fees or hidden costs to ensure transparency.-Car loans available for diverse categories of customers including govt. employees and agriculturist.

Marketing Strategies of Hyundai

Advertisements:-Hyundai had used Bollywood star Sharukh Khan as Brand Ambassador for promoting their car. Through this they tried to attract the customers. Promote their product they organized quiz contests on radio and the person who wins was offered special discounts, gift vouchers, coupons, etc.They also advertise in Newspapers. In this companies advertise about the car in various newspapers and they give detail explanation about the feature of the cars, keeping customers requirement. They also provide various dealers addresses and contact numbers for reference.Free checkups:-Hyundai arranges free checkups from time to time in which they check for any problem and advice to visit the nearest service center for servicing. This helps in maintaining good relationship with customers and tries to keep good image in market.Exchange offers:-As Hyundai deals in second hand cars also. They offer exchange offers to customers. And by paying adjusted amount customer can get brand new car in exchange of old once. Exchange offer makes customer happy as they dont have to pay full amount also, they get new car also and their old car gets replaced also with new one.Cold callings:-In this type of strategies old customers are given a relationship call just to know some other references. This gives a boost to sales and customers also feel a sense of involvement. Hyundai gets maximum sale through such type of cold callings only. Events at Corporate Office and Banks:-Hyundai tries to attract customers by conducting camps, events at corporate offices and bank as most of the customers are of middle-age group and corporate offices are good source for company to attract such customers.

Display:-Hyundai keeps attractive display so that maximum number of people gets noticed. And they even keep their own accessories related to cars at special accessories counter. For attractive display they decorate their showroom as well as all the cars which are displayed.

SuccessStory-HMILs first car ,Santro came out of the plant in less than 17 months. It was priced at Rs 289000 was placed in B segment of the Indian car Industry. The success was not predicted because it was felt that the car lacked an elegance,appealing lock, moreover the B segmented was dominated by zen at that time. Contrary to the expectations santro became a major success ,selling 75000 vehicles between April 1999 to March 2000 becoming the largest selling car in B segment. With the success of just one model Hyundai became second largest automobile manufacturer in India across all segments.Factors contributing to Hyundai Success in India They did a close study of the Indian Market. A complete market research was carried out by the companies top officials. Ideas and other information was taken from vendors ,dealers and customers. Surveys in details were carried out. Analysis of the mindset of customers and their demands. Launched Santro instead of Accent. Products with advanced technology were introduced. Newly innovated market technology.Some USP of Hyundai- Hyundai came into Indian Scenario through its own subsidiary HMIL. It was the first foreign company to establish its own manufacturing unit. Hyundai also launched a complete new product unlike other players. Innovations and attractiveness introduced in design and features. An attractive and intelligent advertising strategy was carried out. Emphasis on customers satisfaction was given. Elaborate procedure for Dealer selection which included: Education Background. Financial net worth. Income details. Investment and loan details.Business Strategy- Hyundai entry into the market was unique in every sense. It initially positioned itself as a B-segment car manufacturing company by launching SANTRO. Technologically superior products which provided Value for money. In order to develop a better image it launched innovative marketing strategies positioning at a better safety, better products and better features. The Indian Middle class was targeted by providing a affordable family size car. They basically focused on a car satisfying Indian needs instead of importing a successful model. It surveyed market before entering. They established themselves as a company providing cars that had better features and was safe. It positioned itself in stages as a company having cars for entire segment. Launched Accent CRDi which was one of the best diesel car in its segment. It was considered as a leap and not a step. Sonata was positioned as Premium car that wasDreamt about by Everyone, Owned by select few.

WHAT IS GM'S STRATEGY IN INDIA?

GENERAL MOTORS is one of the largest corporations in the world. In 1999, based on foreign asset holdings, the UN's World Investment Report (2001) ranked it No 4 among the top 100 transnational corporations. GM has expanded through green fields too but makes foreign acquisitions also a part of its global strategy. India has a fraction of GM's total foreign assets of $68.5billion (25 per cent of total assets). GM continued its subtle Indian presence through technical collaboration with Hindustan Motors, India's flagship car company until 1985. It is this partnership that brought GM and HM together in the 50:50 Halol joint-venture. GM as an American company in India is making a German product for the Indian market, using imported Brazilian engines, and using Indian labour and components. Local content is 60-70 per cent. It is also true that GM has deep pockets and its Indian operation is minuscule. Yet, we should not forget that GM can expand by acquiring foreign companies. So far it really has not acquired much except to buy HM's 50 per cent share. A few years ago it secured a 20 per cent stake in Fiat. While GM has allowed these companies to run autonomously, capturing market share through acquisition is a sound strategy for global expansion. INDIAN STRATEGY 1. GM has stakes in Suzuki Motors (20 per cent), Isuzu (49 per cent), and Fuji Heavy Industry (makers of Subaru 20 per cent). 2. With the latest disinvestments, Suzuki has even firmer control in India and, indirectly, GM. So what does this all amount to? 1. GM's grip on the Indian market may be far greater than what meets the eye: A 100 per cent affiliate, indirect engagement through Daewoo and Suzuki, and a partner in India's largest auto venture MUL

New global Strategy of GM They are focusing on four key things," said General Motors President and Chief Operating Officer: Leveraging our capabilities as a single GM global automotive unit Driving for stretch results Pursuing goals with a sense of urgency Product success around the globe

Entrance of Beat in Indian MarketGMI launched another sedan called the Chevrolet Cruze in the Indian market in October 2009. The Chevrolet Cruze was well received in the Indian market and got good reviews from industry analysts. The Cruze's powerful engine coupled with its compact design made it highly suitable for the congested Indian roads. By June 2011, the Chevrolet Cruze had clocked in sales of 860 units per month, making it one of the best performing premium sedans in the Indian market. Despite the success of GMI's first small car, the Chevrolet Spark, the company could not make any significant impact on the Indian automobile sector.The increase in the sales of the Beat in spite of the problems faced by the Indian automobile market like increasing fuel prices and high interest rates on vehicle loans was seen by many analysts as the sign that GMI was finally improving its performance in the Indian market. Analysts said that GMI had started to understand the preferences of the Indian customers. They said that high fuel efficiency and the low price tag were the main reasons for the success of the Beat diesel in India. But some analysts warned that the increase in the sales of a single model could not be inferred as a turnaround in an automobile market like India which was turning increasingly competitive.GMs core strategiesGeneral Motors is restructuring its Indian operations and evaluating its product portfolio as it looks ahead to improve its market share in the third largest Asian economy.General Motors CEO Mary Barra said, There are many aspects of the business that we need to work on to make sure we are efficient. She added that India was significant to GMs global success story. As car sales are reviving in the country and are expected to grow 5-10% this fiscal year, GM plans to launch 40 new products in India and other international markets, excluding China, North America and Europe.Indeed, GM has been facing a dearth in sales growth despite having a portfolio that includes compact cars - a hot favorite among Indian car buyers. This is because of stiff competition from Hyundai Motor Co,HondaandMaruti Suzukiwhich cumulatively account for two-thirds of car sales in the country.

GM is considering of making India as an export hub for the Asia Pacific regionGM may also be considering India as an export hub for the Asia Pacific region, since the company is beginning to export cars to Chile from its Indian base. India has a population that would work for lower wages, which may be a reason why the company has suggested such a move. The company is shutting down its Australian plant due to the high cost and is expecting to import cars from India into Australia. Apart from Australia, GM also views South America as a favorable destination of India-made cars.Staying ahead of rivalsAs the closest rival, Ford, gears up with the planned launches in the next 18 to 20 months, GM has to gear up its launches as well, though no clear timelines has been indicated by the management.Hondahas also launched popular models like Amaze, Mobilio and Jazz in India and as the demand for these models has shown an uptick since their launch, it does indicate that the companys on the right track. Thus, to compete with the rivals in India whose market share has been gradually building up, GMs strategy seems to be a solid one to oust them.

Bumpy Road Ahead for General Motors India

Late last month, the company announced its decision to recall 1.14 lakh units of its utility vehicle Tavera, manufactured between 2005 and 2013, because they failed to meet emission and specification norms. There has been no official statement on the cause, but media reports suggest GM engineers manipulated emission tests to comply with government standards. Post the controversy, GM has fired about 25 people, including Anil Mehrotra (India CFO), Sheila Jain Sarver (head of GMs India technical centre at Bangalore) and Sam Winegarden (vice president for global engine engineering).Source:http://forbesindia.com/article/checkin/bumpy-road-ahead-for-general-motors-india/35841/1#ixzz3TneixRtI

The problem doesnt end here. From early July, GM has halted the production of its Sail sedan and hatchback citing quality issues. It is contemplating are call.

Dealers believe this will affect business.And its not as if GM Indias cars have been selling big. In June, it sold 6,575 vehicles, down 11 percent year on year.

Can GM catch up in India?If you look at how GM have done in past three or four years, there has been a significant increase in volumes, said Pragya Bansal, an automotive industry analyst at Fitch Ratings. The trouble is that GM isworking from a dismally low base. GM virtually ignored India during the 1990s . As a result, Japan's Suzuki took a massive lead through its Maruti-Suzuki joint venture, and upstart Korean car maker Hyundai jumped out to take a market share of more than 20 percent.According to the Society of Indian Automobile Manufacturers, Maruti Suzuki India's share of India's passenger car market fell to 48.7 percent in 2011 from 50.1 percent in 2009. Hyundai's market share fell to 18.1 percent from 20.6 percent. And Tata Motors dropped to 12.9 percent from 13.2 percent. While GM gave back a little ground, too, dropping to 4.4 percent from 4.6 percent, it's still doing better than during the bad old days. But the real story is sales volumes. India is where the action is. And even as the big players lose share to new entrants, everybody's sales are booming. After half-hearted failures with the outdated Escort and various Opel models, Ford and GM have over the past five years revamped their India strategies to emulate the industry's most successful players launching made-for-India hatchbacks, increasing their focus on diesel engines, and cutting prices to the bone. GM hit the ground running when it shuttered Opel and introduced its Chevrolet brand, rolling out eight new models since 2003. But its biggest success has come with the launch of its own cheap hatchbacks the Aveo, Spark and Beat which have come with an aggressive pricing and merchandizing strategy.What Chevy did was gave me about 20,000 rupees [$500] worth of freebies including an audio system, a security system, a gear lock that's not part of the standard system and other small things like a car cover, black strips and a bunch of stuff, said Pierre Fitter, a young Indian who recently bought his first car (like many Goans, he has a Western-sounding name). What really sold me was the free servicing for three years.No doubt the American carmakers are dipping into the marketing budget to compete with Hyundai and Maruti-Suzuki. They're also tapping the cheap money flooding US credit markets post-2008 to finance massive expansion plans in India, with billion-dollar investments on the cards for new factories that will dramatically increase manufacturing capacity.Because of access to cheaper money they're able to undertake massive expansion, said Fitch's Bansal. Ford is investing about $2 billion in emerging economies, of which $1 billion is coming to India only.