Presented by-Saurabh srivastava

Honda's exit from Hero Honda Joint venture - ITS IMPACT ON CONSUMERS.

SOURCE- FINANCIAL EXPRESS

INTRODUCTION• Hero Honda Motors Limited• Based in Delhi.• A joint venture between the hero group of India and Honda of

Japan• It has been referred to as the world's biggest manufacturer of

2-wheeled motorized vehicles since 2001, for nine consecutive years.

• The company had a market share of 41.35% in the year 2008-2009 and over a 25 year span it has crossed the 15 million unit milestone.

• Hero Honda sells more two wheelers than the second, third and fourth placed two-wheeler companies put together.

• The company's most popular model is the Hero Honda splender which is the world's largest-selling motorcycle, selling more than one million units per year.

What happened really!!!!!

• Japanese auto giant Honda has reached an agreement to dissolve their 26-year old joint venture

• Honda Motor Co is expected to sell its entire 26 per cent stake in Hero Honda to its partner Munjals.

• Honda will no longer provide technical support to Hero Honda.• Honda proposes to focus on Honda Motorcycle and Scooter India

(HMSI). • Honda to enter the Indian two-wheeler market through its wholly-

owned subsidiary Honda Motorcycle & Scooter India (HMSI). • Hero Honda is setting up the fourth plant in the country. It already has

three facilities at Dharuhera and Gurgaon in Haryana and at Haridwar in Uttarakhand with a total capacity of 50 lakh units a year.

• HMSI has announced an investment of Rs 500 crore to set up its second plant near Bhiwadi (Rajasthan), with an annual capacity of six lakh units. Once the facility becomes operational, in the second half of 2011, the company's total annual capacity will reach to 22 lakh units.

• HMSI is also reportedly scouting for a location to set up its third facility

Its impact on consumer behavior ………..

PERCEPTION• The perception of the consumer

will change about the-o Future prospects.o Reliability.o Technology advancements.o Performance doubtfulness.

LEARNING• Image of the company will be

changed.• Thinking will be different.• Cognitive memory will be ruined.• The image of ‘DESH KI DHADKAN’

will be no more in the minds of consumer.

Contd……ATTITUDE

• Association with the product will be changed.• Hero bikes will be taken as a ‘swadeshi’ product.• Brand belief will be changed.• Company image of DESH KI DHADKAN – DHAK DHAK GO will

be no more.

• Technological reliability will not be there.

contd………

MOTIVATION• Consumer will be less motivated

to buy the product because the brand value will be decreased.

• Previously Hero-Honda was having an image of both swadeshi and foreign technology ----- but now it is having only swadeshi image not foreign technology.

PERSONALITY

• Ethnocentric people will become a loyal consumer of Hero group’s bike.

• Dogmatic consumers will switchover the brand.

Change in the company structure

& name impacts the consumer

behavior towards the brand,

because consumer has some

resistance to change, & that

change should be introduced to

the consumer in a positive manner

by using new marketing strategies.