3. Two Wheel Automobile Industry

Study on Two Wheeler Automobile Industry in Mumbai M umbai

1. Overview of Two-wheeler Industry: Baj Bajaj is the the firs firstt Indi Indian an two two whee wheeller aut automob omobiile company in the market since 1945 with the name M/s Bacharj trading corporation private limited. In 1959 M/s Bacharj trading corporation private limited change its name as Bajaj Auto Ltd. Bajaj Auto obtains license from the Government of India to manufacture two- and three-wheelers vehicles in 1959. Hero Honda Motors Limited was established in 1984, as a joint joint ventur venturee betwee between n India's India's Hero Hero Group Group (world (world's 's largest bicycle manufacturers) and Japan's Honda Motor Company and created the world's single largest two wheeler company and also one of the most successful joint ventures worldwide. During the 80s, Hero Honda became the first company in India. Over 19 million Hero Honda two wheelers are running on Indian roads today. TVS Motors is the third largest company in the twowheeler industry with a market share of 16%. Infect, it is the only Indian company without a foreign collaboration in the two-wheeler industry. When the company opted out out of the the coll collabo abora rati tion on with with Suzu Suzuki ki in 2002 2002,, many many believed that TVS was headed towards extinction. But the company proved the doomsayers wrong and came out with a very successful `TVS Victor'. TVS Motors Ltd. originally incorporated in 1982 to manufacture two-wheelers in collaboration with Suzuki Motors of Japan, TVS was one of the leaders in twowheeler industry. Yamaha Motor Corporation Corporation is the auto mobile company of Japan (1953) which works in India since 1955 and pro provi vidi ding ng late latest st tech techno nolo logy gy in Indi Indiaa from from last last two two decades. Yamaha Motor India was incorporated in august 2001 as a 100% subsidiary of Yamaha motor corporation, Japan

Honda motors of Japan is not a new name in the two wheeler scenario in the country, they were in a tie up with the Firodias owned Kinetic group. However in the late late 90s 90s they they parte parted d ways ways afte afterr probl problem emss aros arosee over over issu issues es like like intr introd oduc ucti tion on of new new model models, s, adve advert rtis isin ing g 1


expenditure, marketing strategies and other related issues. In the mid 80 Honda motors of Japan joined hands with the largest bicycle maker of India the Hero cycles to create Hero Honda which in a couple of decades or so have gone on to become the single largest motorcycle company in the world. Though Honda has come on its own on the Indian market yet it will be providing technological support to Hero Honda for the next ten years. Thus presenting a unique situation in which the company company will be in direct direct competition competition with the company which it has been associated for nearly two decades. Honda Motorcycles and Scooters India limited, a 100% subsidiary of Honda motor company Japan eventually entered the Indian market with Honda Unicorn in 2004. Royal Enfield was the name under which the Enfield Cycle Cycle Company Company (a division division of the British arms-making arms-making compan company y Roya Royall SmallA SmallArmsF rmsFact actory ory in Enfi Enfiel eld d Lock Lock ), ), made motorcycles, motorcycles, bicycles, bicycles, lawnmowers and stationar y engines. engines. This legacy of weapons manufacture is reflected in the logo, a cannon, and their motto "Made like a gun, goes like a bullet". Use of the brand name Royal Enfield was licensed by the Crown in 1890. The original Redditch, Redditch, Worcestershire based company company was sold to E. & H. P. Smith in 1963 and then to Norton-Triumph-Villiers to Norton-Triumph-Villiers (NVT). Production ceased in 1970 and the company was dissolved in 1971. In 1955 Enfield of India starte rted assembling Bullet moto otorcy rcycles under licence under licence from UK components, components, and by 1962 was manufacturing manufacturing complete bikes. India bought the rights to use the Royal Enfield name in 1995. Royal Enfield production, based in Chennai, Chennai, continues and Royal Enfield is now the oldest motorcycle brand in the world still in production with the Bullet model enjoying the longest motorcycle production run of all time.

The Two-wheeler industry is known for its inherent cyclical feature with 18 mont mo nths hs of gro growt wth h fo foll llow owed ed by 18 mo mont nths hs of deg degro rowt wth. h. Th Thee in indu dust stry ry ha had d outperforme outpe rformed d thebro thebroader ader market in the latter half of FY (Financial Year) 06. FY07 was a period of consolidation with the big players capturing a larger market share among their niche segments. Thereon it continued to underperform the broader market with the exception of Q3FY09. BSE Auto Index has seen a fall of >30% in the last quarter and has hit an all-time low of 2444 points which has not been seen in the past 4 years. We believe the industry is ready to pick up from a lower base, which keeps its downside capped. Sale volumes of the industry would continue to replicate a seasonal trend. Though the sale volumes have witnessed a decline for more than a year, its revival would be a slow and steady process, which would be delayed on account of the unfavorable macro2


expenditure, marketing strategies and other related issues. In the mid 80 Honda motors of Japan joined hands with the largest bicycle maker of India the Hero cycles to create Hero Honda which in a couple of decades or so have gone on to become the single largest motorcycle company in the world. Though Honda has come on its own on the Indian market yet it will be providing technological support to Hero Honda for the next ten years. Thus presenting a unique situation in which the company company will be in direct direct competition competition with the company which it has been associated for nearly two decades. Honda Motorcycles and Scooters India limited, a 100% subsidiary of Honda motor company Japan eventually entered the Indian market with Honda Unicorn in 2004. Royal Enfield was the name under which the Enfield Cycle Cycle Company Company (a division division of the British arms-making arms-making compan company y Roya Royall SmallA SmallArmsF rmsFact actory ory in Enfi Enfiel eld d Lock Lock ), ), made motorcycles, motorcycles, bicycles, bicycles, lawnmowers and stationar y engines. engines. This legacy of weapons manufacture is reflected in the logo, a cannon, and their motto "Made like a gun, goes like a bullet". Use of the brand name Royal Enfield was licensed by the Crown in 1890. The original Redditch, Redditch, Worcestershire based company company was sold to E. & H. P. Smith in 1963 and then to Norton-Triumph-Villiers to Norton-Triumph-Villiers (NVT). Production ceased in 1970 and the company was dissolved in 1971. In 1955 Enfield of India starte rted assembling Bullet moto otorcy rcycles under licence under licence from UK components, components, and by 1962 was manufacturing manufacturing complete bikes. India bought the rights to use the Royal Enfield name in 1995. Royal Enfield production, based in Chennai, Chennai, continues and Royal Enfield is now the oldest motorcycle brand in the world still in production with the Bullet model enjoying the longest motorcycle production run of all time.

The Two-wheeler industry is known for its inherent cyclical feature with 18 mont mo nths hs of gro growt wth h fo foll llow owed ed by 18 mo mont nths hs of deg degro rowt wth. h. Th Thee in indu dust stry ry ha had d outperforme outpe rformed d thebro thebroader ader market in the latter half of FY (Financial Year) 06. FY07 was a period of consolidation with the big players capturing a larger market share among their niche segments. Thereon it continued to underperform the broader market with the exception of Q3FY09. BSE Auto Index has seen a fall of >30% in the last quarter and has hit an all-time low of 2444 points which has not been seen in the past 4 years. We believe the industry is ready to pick up from a lower base, which keeps its downside capped. Sale volumes of the industry would continue to replicate a seasonal trend. Though the sale volumes have witnessed a decline for more than a year, its revival would be a slow and steady process, which would be delayed on account of the unfavorable macro2


economic econom ic con condit dition ionss and dep depress ressed ed con consum sumer er sen sentim timent ents. s. On one han hand d the slackening growth in the GDP and IIP would put pressure on the demand factor, whereas the fall in inflation, input costs and crude prices would ease the cost constraints. We can expect the scenario of FY07 to be repeated, wherein the sale sa less an and d ma marg rgin in wo woul uld d be in inve vers rsel ely y co co-r -rel elat ated ed.. Se Sect ctor or in ince cent ntiv ives es an and d government policies would determine the sector movement going forward. 1.1Evolution of two-wheeler in India: TwoTwo-wh whee eele lerr segm segmen entt is one of the the most most impo importa rtant nt comp compon onen ents ts of the the automobile automobile sector that has undergone significant significant changes due to shift in policy environment. The two-wheeler industry has been in existence in the country since 1955. It consists of three segments viz. scooters, motorcycles and mopeds. In India there are some MNC’s and Indian company dealing in automobile sector. The main key players who are dealing in this sector are Hero Honda, Bajaj, Yamaha, Honda, and TVS. Hero Honda is the biggest player in this sector sector in India as well as in the world and playing playing a very important important role in two whee wheele lerr auto automo mobi bile le sect sector or.. Hero Hero Hond Honda, a, Baja Bajajj and and TVS TVS are are the the Indi Indian an companies and Yamaha & Honda are international automobile brand. 1.2Industry Structure:

India is the 2nd largest two-wheeler market in the world with a size of over Rs. 100,000 MN. The total sale of two wheelers in India has touched a figure of 7.9 MN units by March, 2007, up 11.4% from the previo previous us fiscal figure of 7.1 MN uni units. ts. Prod Product uction ion duri during ng the per period iod rea reache ched d 10. 10.8 8 MN uni units, ts, entailing entailing a demand ratio of 72%. In terms of sales and market share the major players of thee in th indu dust stry ry ar aree He Hero ro Ho Hond nda, a, Ba Baja jajj Au Auto to an and d TV TVS S Mo Moto tors. rs. Ot Othe herr pl play ayer erss include Kinetic Motors, Yamaha Motor and Honda Motorcycle and Scooter Indi In diaa (HM (HMSI SI). ). Th Thee co comp mpos osit itio ion n of th thee in indu dust stry ry co cons nsis ists ts of mo moto torcy rcycl cles es,, scoo sc oote ters rs an and d mo mope peds ds.. Ov Over er th thee pa past st de deca cade de,, th ther eree ha hass be been en a co cons nsum umer er preferential shift from mopeds to scooters and now motorcycles. On account of the shift, the motorcycle segment dominates the two-wheeler industry with a market share of close to 80%. The motorcycle segment is further sub divided into 3 classes, starting from the entry/economy class (Rs. 30,000 – Rs. 40,000), executive execut ive class (Rs. 40,000 –Rs. 50,000) and the premiu premium m class (>Rs. 50,000). 50,000). The motorcycle segment is primarily led by Hero Honda with a market share of 59% 59 % fo foll llow owed ed by Ba Baja jajj Au Auto to (18 (18%) %),, HM HMSI SI (9 (9%) %),, TV TVS S Mo Moto tors rs (7 (7%) %) an and d Yamaha (5%). On the other hand the scooter segment is led by HMSI which has a dominant share of 63% followed by TVS Motors (16%) and Hero Honda 3


(14%). When it comes to the moped segment, it is primarily dominated by TVS Motors with a market share of 100%. Over the last decade, the two wheeler automobile sector has successfully changed changed its image. Its product range encompasses encompasses Scooterettes Scooterettes,, Scooters Scooters and Motorcycles. The main product ranges of two wheeler automobile sector are as follows: ➢ ➢ ➢

Scooters Motorcycles Mopeds

No. of players in the two wheeler automobile sector (India): ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢

Hero Honda motors ltd. Bajaj auto ltd. TVS motors company ltd. Yamaha motors India Honda motorcycle and scooters India Royal Enfield Suzuki Motors LML Mahindra 2 Wheelers

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Study on Two Wheeler Automobile Industry in Mumbai

2. Manufacturing Process: 2.1 Basic Manufacturing Process: Raw Materials

The primary raw materials used in the manufacture of the body of motorcycle are metal, plastic and rubber. The motorcycle frame is composed almost completely of metal, as are the wheels. The frame may be overlaid with plastic. The tires are composed of rubber. The seat is made from a synthetic substance, such as polyurethane. The power system consists of a four-stroke engine, a carburetor to transform incoming fuel into vapor, a choke to control the air-fuel ratio, transmission, and drum brakes. The transmission system contains a clutch, consisting of steel ball flyweights and metal plates, a crankshaft, gears, pulleys, rubber belts or metal chains, and a sprocket.

The electrical system contains a battery, ignition wires and coils, diodes, spark plugs, head-lamps and taillights, turn signals and a horn.

5


A cylindrical piston, made of aluminum alloy (preferred because it is lightweight and conducts heat well), is an essential component of the engine. It is fitted with piston rings made of cast iron. The crankshaft and crankcase are made of aluminum. The engine also contains a cylinder barrel, typically made of cast iron or light alloy. The Manufacturing Process

1. Raw materials as well as parts and components arrive at the manufacturing plant by truck or rail, typically on a daily basis. As part of the just-in-time delivery system on which many plants are scheduled, the materials and parts are delivered at the place where they are used or installed. 2. Manufacturing begins in the weld department with computer-controlled fabrication of the frame from high strength frame materials. Components are formed out of tubular metal and/or hollow metal shells fashioned from sheet metal. The various sections are welded together. This process involves manual, automatic, and robotic equipment. 3. In the plastics department, small plastic resin pellets are melted and injected into molds under high pressure to form various plastic body trim parts. This process is known as injection molding.

6


A motorcycle engine

4. Plastic and metal parts and components are painted in booths in the paint department using a process known as powder-coating (this is the same process by which automobiles are painted). A powder-coating apparatus works like a large spray-painter, dispersing paint through a pressurized system evenly across the metal frame. 5. Painted parts are sent via overhead conveyors or tow motor (similar to a ski lift tow rope) to the assembly department where they are installed on the frame of the motorcycle 6. The engine is mounted in the painted frame, and various other components are fitted as the motorcycle is sent down the assembly line 7. Wheels, brakes, wiring cables, foot pegs, exhaust pipes, seats, saddlebags, lights, radios, and hundreds of other parts are installed on the motorcycle frame. A Honda Gold Wing motorcycle, for example, needs almost as many parts to complete it as a Honda Civic automobile. The Future

Motorcycles remain popular and the collecting and riding of antique models is just as popular as riding the new versions. While sleek, new versions will continue to be produces,

7


A motorcycle transmission and disc brake system.

8


2.2 Accessories and Finished Products ➢

Side mirrors

➢

Lock box

➢

Tool box

➢

Seat cover

➢

Fog light

➢

Shocker lock

➢

Leg guard

➢

Helmet lock

➢

Stephaney for scooters

➢

Foot rest

2.3Marketing Mechanism Promotion

Promotion concerns the message the firm sends out to potential consumers. It provides information and persuades people, it creates awareness, stimulates demand and differentiates the product and influences public behavior. Promotion won’t make a bad product that no one wants a success; although the absence of promotion might that a good product is not successful, promotion includes all the activities or tools a company uses to communicate or promote its product in the market. Promotional tools or promotion mix 1. Personal Selling: It involves personal confrontation either by phone or face;

it is an expensive and time-consuming tool of promoting the product.

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Study on Two Wheeler Automobile Industry in Mumbai 2. Advertising: It is defined as a paid non-personal communication with a

target (usually mass) market. It is cost effective and can reach a large number of people. It can also be used for long term or short term objectives. There are various forms or mediums through which can advertise.

A. Broadcast Media: Television • • Radio Cinema • B. Print media: • Newspapers Magazines • • Leaflets C. Outdoor media: •

Posters and billboards.

1. Public Relations an Publicity:

Public relations are an umbrella term and refer to the totality of the organization’s behavior with respect to the society in which it operates. The maybe regarded as good or bad and is reflected in the company’s reputation and image. 2. Sponshership:

Sponsorship can be seen as a part of public relations and it is certainly the case that some sponsorship goes on to generate positive publicity for the organization. 3. Direct Marketing:

It is an interactive system of marketing which uses one or more advertising media to affect a measurable response at any locations It includes: 10


• • • • •

Direct mail. Telemarketing. Door to door selling. Direct response advertising: ‘phone now’ or ‘fill in the coupon ads’ Home shopping of various types.

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Factors that guide a marketer’s decision in selecting a promotion mix: a) Nature of product b) Overall marketing strategy c) Buyer readiness stage d) Product life cycle stage 1. Sponsorships:

The company has not left any stone untamed in sponsoring the major events both globally and domestically. The biggest of all is the sponsorship of the “WORLD CUP” for which Hero Honda has the credit of being the only twowheeler company in the world to do so. Besides this, the company has also sponsored events like “Master Golf”, television academy awards, etc. Thus the company has gained a lot of reputation by doing so. 2. Discounts/Offers:

The company has started giving discounts and other offers to the customers on the purchase of a new bike, for instance, with the World Cup offer, in which the consumer was to get a 1 gm gold coin with every purchase. But after all these schemes and benefits may be because of cut-throat competition in the segment with heavyweight competition such as Bajaj, kinetic, Yamaha, and TVS the company (HERO HONDA) officially says: “Our aim is to proactively and consistently deliver value to the customer. We are giving back to the customer after becoming successful. Most companies give discounts only when their products are not doing well in the market. There is loss of competition in the segment, especially from Bajaj. But the reason for Hero Honda’s success it that we are consumer-focused while other companies such as Bajaj tends to be more competitor-focused.

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3. Company Profiles: 3.1 Hero Honda Motors Limited Hero Honda Motors Limited was established in 1984, as a joint venture between India's Hero Group (world's largest bicycle manufacturers) and Japan's Honda Motor Company. In 1985 production began with the launch of its first motorcycle, the CD100, which gave 80 km to the liter. In 1987 the engine plant was started and in 1989 the Company produced its 3,00,000th motorcycle. In 2001 Hero Honda manufactured its 50,00,000th motorbike. Hero Honda has a reputation of being the most fuel-efficient and the world's single largest two wheeler Company. Shri Brijmohan Lall Munjal is the chairman and managing director of this Company. As early as in 1960’s very few Indian bicycle manufacturers were interested in exports. However, the hero groups foray into the overseas markets in 1963 pioneered Indian exports in the bicycle segment. It was more prompted essentially by the need to remain attuned to the global marketplace. While initial exports were restricted to Africa and the middle east, today more than 50% of the exports from Hero Cycles Ltd. Meet the demands of sophisticated markets in Europe and America. This is primarily because of appropriate product development and excellent quality that hero offers. Hero Honda has grown like no other company in the auto business. Several times in the path, savvy observers have insisted that it has grown just too big and that no company its size can continue to show growth rates. But Hero Honda has ignored that opinion and continued growing at the place it has set many years ago. Hero Honda today faces more competitor than it has ever in the history. Now that is the undisputed two wheeler Numero Uno in the country. Every single two wheeler manufacturer in India if looking market share away from it. More over for the first time there are so many four- stroke challengers in the market. And Hero Hondas best-selling products are ageing. Corporate Profile:

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The joint venture between India's Hero Group and Honda Motor Company, Japan has not only created the world's single largest two wheeler company but also one of the most successful joint ventures worldwide. During the 80s, Hero Honda became the first company in India to prove that it was possible to drive a vehicle without polluting the roads. The company introduced new generation motorcycles that set industry benchmarks for fuel thrift and low emission. A legendary 'Fill it - Shut it - Forget it' campaign captured the imagination of commuters across India, and Hero Honda sold millions of bikes purely on the commitment of increased mileage Over 19 million Hero Honda two wheelers tread Indian roads today. These are almost as many as the number of people in Finland, Ireland and Sweden put together! Hero Honda has consistently grown at double digits since inception; and today, every second motorcycle sold in the country is a Hero Honda. Every 30 seconds, someone in India buys Hero Honda's top -selling motorcycle – Splendor. This festive season, the company sold half a million two wheelers in a single month—a feat unparalleled in global automotive history. Hero Honda bikes currently roll out from two globally benchmarked manufacturing facilities based at Dharuhera and Gurgaon in Haryana. These plants together are capable of churning out 3.9 million bikes per year. A third state of the art manufacturing facility at Hardwar in Uttranchal will soon be commissioned to cope with sustained customer demand. Hero Honda's extensive sales and service network now spans over 3000 customer touch points. These comprise a mix of dealerships, service and spare points, spare parts stockiest and authorized representatives of dealers located across different geographies. Hero Honda values its relationship with customers. Its unique CRM initiative Hero Honda Passport Program, one of the largest programs of this kind in the world, has over 3 million members on its roster. The program has not only helped Hero Honda understand its customers and deliver value at different price points, but has also created a loyal community of brand ambassadors. Having reached an unassailable pole position in the Indian two wheeler market, Hero Honda is constantly working towards consolidating its position in the market place. The company believes that changing demographic profile of India, increasing urbanization and the empowerment of rural India will add 14


millions of new families to the economic mainstream. This would provide the growth ballast that would sustain Hero Honda in the years to come. As Brijmohan Lall Munjal, the Chairman, Hero Honda Motors succinctly points out, "We pioneered India’s motorcycle industry, and it's our responsibility now to take the industry to the next level. We'll do all it takes to reach there.''

Mission statement:

Hero Honda’s mission is to strive for synergy between technology, systems and human resources, to produce products and services that meet the quality, performance and price aspirations of its customers. At the same time maintain the highest standards of ethics and social responsibilities. This mission is what drives Hero Honda to new heights in excellence and helps the organization forge a unique and mutually beneficial relationship with all its stake holders. 3.1.1 Hero Hondas Mandate:

Hero Honda is a world leader because of its excellent manpower, proven management, extensive dealer network, efficient supply chain and world-class products with cutting edge technology from Honda Motor Company, Japan. The teamwork and commitment are manifested in the highest level of customer satisfaction, and this goes a long way towards reinforcing its leadership status 3.1.2 S.W.O.T Analysis:

Strengths: ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢

Hero Honda introduced First stroke bike in the Indian market. Hero Honda gives 80 Km/Liter Avg. Huge sale network (3500 Dealers). Better sale service. It has the highest share in automobile sector. It has a good brand image. It gives better service for customers. Best customer preference. Debt equity ratio is only 0.1. The company has clarified about its intention of setting a third plant in addition to its existing two plants. The company has embarked upon a green field expansion plan and has earmarked Rs 2 bn for the same. It 15


should be noted that the company has a strong cash flow position; it generated Rs 9 bn from operation in FY04 and is virtually a debt free company. Weakness: ➢

Suppose to be very sophisticated. ➢ Not fit for ruler India. ➢ They have big gap between cubic capacities of its products. ➢ Its market share is reducing from last few years. ➢ Spare parts are too costly. Opportunities: ➢

➢ ➢ ➢ ➢

Hero Hondas the first manufacture to launch ecofriendly bikes with 4stroke engines. They have attained a stronger good will and popularity in the industry and the consumers. They should go in new segments of bikes. There is large no. of young consumers in the market. Company has to focus on them. They have big opportunities in heavy bike segments. As government policies are amended against pollution in metro cities, Hero Honda being 4 stroke bike manufacture has great opportunities to explore its new innovations and technologies.

Threats: ➢

➢ ➢

Main threats to Hero Honda are their competitors like:Bajaj Auto Ltd. ○ TVS motors Ltd. ○ Yamaha Motors India. ○ Honda motorcycle and scooter India. ○ The cost of the product is very high in comparison to other companies. Decreasing market share.

3.1.3 Hero Hondas Core Values ➢ ➢ ➢ ➢

Respect for Human Beings. Is a responsive organization? Is a boundary less organization? Is striving for excellence. 16

Study on Two Wheeler Automobile Industry in Mumbai ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢

Provide fearless, enjoyable working environment. Is self-reliant. Providing learning environment. Is a caring organization? Enables relationship buildings. Prompts transparency & trust. Is creativity promoting. Is performance oriented?

3.1.4 Product Range:

Scooters 1. Hero Honda Pleasure: Production: 2005 Present Price: Rs. 37,990 Engine: 102 cc, 7bhp@ 7000 rpm, Torque: 0.78 kgm @5000 rpm

Motorcycles: 1. Hero Honda CD Delux: Production: 2001 present Price: Rs.35642 Engine: 97.cc,7.5bhp@8000rpm, 4stroke engine, single cylinder

2. Hero Honda Ambition: Production: 2004 present Price: Rs.49000 Engine: 135 cc, four-stroke engine, single piston, kick start11bhp 3. Hero Honda CD Dawn: Production: 2004 Present Price: Rs. 33542 17


Engine: 97 CC, 7.5 bhp @8500 rpm, 4 stroke engine, Torque: 8.05 Nm @ 5,500 rpm

4. Hero Honda Passion Plus: Production: 2006 Present Price: Rs. 46275 Engine: 97 CC, 4-stroke engine, single cylinder Power: 7.4 bhp @8000 rpm

5. Hero Honda CBZ Extreme: Production: 2005 present Price: Rs. 62000 Engine: 149.2 cc, four-stroke cycle, single piston Power: 14.2 bhp @ 8500 rpm Torque: 1.26 kgm @ 6500rpm

6. Hero Honda Spelendor NXG: Production: 2004 present Price: Rs. 48,600 Engine: 124.7 CC, 4 stroke engine Power: 9 bhp @ 7000 rpm Torque: 8.05 Nm at 5,500 rpm 7. Hero Honda Achiever: Production: 2006 present Price: Rs. 51298-56022 Engine: 149.1 CC, 4-stroke engine, single cylinder Power: 3.4 bhp @ 8000 rpm

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8. Hero Honda Glamour: Production: 2005 present Price: Rs 49777-56529 Engine: 124.7 cc, four-stroke cycle, single piston, kick start Power: 9 bhp @7000 rpm

9. Hero Honda Hunk: Production: 2008 present Price: Rs. 64000 Engine: 149.2 cc, four-stroke cycle, single piston Power: 14.2 bhp hp @ 8500 rpm Torque: 1.26 kgm @ 6500rpm 10. Hero Honda Karizma R Production: 2005 present Price: Rs. 76393 Engine: 223cc, 4 – Stroke Power: 12.68 KW (17 PS) @ 7000 rpm 11. Hero Honda Karizma ZMR Production: 2010 present Price: Rs.98000 Engine: PGM-Fi 223cc, 4-stroke Power: 17.6 Bhp @ 7000 rpm Torque: 18.35 Nm @ 6000 rpm

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3.1.5 Balance sheet of Hero Honda Motors Ltd. As on 31st march 2006

(Rs. In crores)

Table 1.1

Schedule

31st march2006

31st march2005

Share capital

1

39.94

39.94

Reserve & surplus

2

1969.39

1453.44

Loan funds:

3 185.78

201.76

120.10

101.53

2315.21

1796.67

Gross block

1471.97

1104.19

Less: depreciation

522.6

429.71

949.37

674.48

44.19

40.85

Particulars Shareholders’ funds:

Unsecured

Deferred tax liabilities

8

Total Application of funds:

Fixed assets

4

Capital working process Net block

993.56

715.33

Investment

5

2061.89

2026.65

Deferred tax assets

8

1.32

0.63

20


Current assets, loan & advances:

6

Inventories

226.55

204.26

Sundry debtors

158.66

89.55

Cash and bank balances

15872

17.6

Loans and advances

273.78

239.61

Other current assets

3.53

3.51

Current liabilities

1072.88

1015.76

Provisions

489.92

484.71

1562.8

1500.47

Less: current liabilities & provisions

7

Net current assets

741.56

945.94

3.1.6 Profits & LOSSES A/C OF HERO HONDA LTD. Year 2005-06 Table 1.2 Particulars

(Rs. In crores) schedule

31st 2006

march 31st march2005

INCOME Gross sales Less: excise duty Net sales Other incomes TOTAL

10086.16 1372.18 8713.98 15628.00 8870.26

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8596.81 1175.16 7421.65 136.9 7558.55

EXPENDITURES Manufacturing and Other expenses Depreciation Net interests TOTAL Profit before tax Profit for taxation

10 4 11

21

7349.53

6253.01

114.62 6.13 7458 1412.24

89.38 1.09 6341.30 1217.25

Study on Two Wheeler Automobile Industry in Mumbai Current Deferred Fringe benefits Profit after tax Balance of profit b/d Balance available for appropriation

415.85 1788 7.17 971.34 808.1 1779.44

395.22 11.56 0 810.47 538.53 1349

399.38 56.01 100 1224.05

399.38 56.52 85 808.1

APPROPRIATION Proposed dividend Tax on dividend Transferred to general reserve Balance carried to balance sheet Basic and diluted earnings per share face values Rs. 2/each

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3.1.7 Board of Directors Table 1.3 No. Name of the Directors Designation 1 Mr. Brijmohan Lall Munjal Chairman & Whole-time Director 2 Mr. Pawan Munjal Managing Director 3 Mr. Toshiaki Nakagawa Jt. Managing Director 4 Mr. Takao Eguchi Whole-time Director 5 Mr. Sunil Kant Munjal Non-executive Director 6 Mr. OmPrakash Munjal Non-executive Director 7 Mr. TatsuhiroOyama Non-executive Director 8 Mr.MasahiroTakedagawa Non-executive Director 9 Mr. NarinderNathVohra Non-executive & Independent Director 10 Mr. PradeepDinodia Non-executive & Independent Director 11 Gen.(Retd.) Ved Prakash Non-executive & Independent Director Malik 12 Mr. Analjit Singh Non-executive & Independent Director 13 Dr. Pritam Singh Non-executive & Independent Director 14 Ms. ShobhanaBhartia Non-executive & Independent Director 15 Dr. Vijay LaxmanKelkar Non-executive & Independent Director 16 Mr. Sunil Bharti Mittal Non-executive & Independent Director

23


3.2 Bajaj Auto Ltd. Since 1986, there is a technical tie-up of Bajaj Auto Ltd. with Kawasaki Heavy Industries of Japan to manufacture state-of-art range of latest two-wheelers in India. The JV has already given the Indian market the KB series, 4S and 4S Champion, Boxer, the Caliber series, and Wind125 Kawasaki Heavy Industries is a Fortune 500 company with a turnover of USD 10 billion (Rs. 45,840 crore). It has crafted new technologies for more than hundred years. The technologies of KHI have redefined space systems, aircrafts, jet engines, ships, locomotive, energy plants, automation system, construction machinery, and of course high reliability two-wheelers KHI has given the world its legendary series of 600-1200cc Ninja and 1600 Vulcan bikes. Straight from its design boards, the Kawasaki Bajaj Eliminator, India's first real cruiser bike, redefines the pleasure of "biking" in looks as well as performance. Corporate Profile

'Inspiring Confidence,' the tagline, has built up confidence, through excitement engineering, not only to domestic consumers but also internationally. Established just eight decades back in 1926 by Jamnalal Bajaj, the company has been vested with India's largest exporter of two and three wheelers, 196,710 units in 2004-05, a great 26 per cent jump over the previous year. Bajaj Auto Ltd. sales have increased by approximately 21 per cent in the year 2004-05, which exceeds Rs 65.4 billion, a record in the history of the company. The gross operating profit stands at Rs. 9.3 billion, again a record. The profits after tax of the BAL are close to Rs. 7.7 billion, and the pre-tax return on operating capital is at an impressive 80 per cent. The strength of the company is its quality products, excellence in engineering and design, and its ability to delight the customers. The Pulsar, introduced in November 2004, is continually dominating the premium segment of the motorcycle market, helping to maintain the market superiority. Discover DTSi, one more successful bike on Indian roads, is in the 'value' segment of the 24


motorcycle market. It incorporates a high degree of power with fuel efficiency of a 100 cc motorcycle. BAL is committed to prevention of pollution, continual improvement of environment performance and compliance with all environmental legislation and regulations. They always believe in providing the customer 'value for money' and keep a special eye upon quality, safety, productivity, cost and delivery. Bajaj Auto Mission:

We at Bajaj Auto continue to firmly believe in providing the customer Value for money, for years through our products and services. This we shall maintain and improve, In our decision making, quality, safety and service will be given as much consideration as productivity, cost and delivery. Quality shall be built into every aspect of our work life and business operations. Quality improvements and customer satisfaction shall be the responsibility of every employee. Location CPM MLCommercial -Marketing Customer -Account Sr. Business Business Ops. Biz. Head Ops.- For Head Head the Development Executives Managers Relations Dept. (India) State

3.2.1 Organizational Structure of Bajaj Auto Ltd. Largest Export

Bajaj Auto continued to be India’s largest exporter of two wheelers. During 2005-06, it exported 75297 two which represented a growth of 33 per cent over 2004-05. Graph 1.1

3.2.2 SWOT Analysis

Let's analyze the position of Bajaj in the current market set-up, evaluating its strengths, weaknesses, threats and opportunities available. Strengths 25


➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢

Highly experienced management. Product design and development capabilities. Extensive R & D focus. Widespread distribution network. High performance products across all categories. High export to domestic sales ratio. Great financial support network (For financing the automobile) High economies of scale. High economies of scope.

26


Weaknesses ➢

Hasn't employed the excess cash for long. ➢ Still has no established brand to match Hero Honda's Splendor in commuter segment. ➢ Not a global player in spite of huge volumes. ➢ Not a globally recognizable brand (unlike the JV partner Kawasaki) Opportunities ➢ ➢ ➢ ➢

➢

Double-digit growth in two-wheeler market. Untapped market above 180 cc in motorcycles. More maturity and movement towards higher-end motorcycles. The growing gearless trendy scooters and scooterette market. Growing world demand for entry-level motorcycles especially in emerging markets

Threats ➢ ➢

➢

The competition catches-up any new innovation in no time. Threat of cheap imported motorcycles from China. Margins getting squeezed from both the directions (Price as well as Cost)

3.2.3 The Inevitable Change

Bajaj on internal analysis found that it lacked – 1. The technical expertise to deliver competitive goods. 2. The design know-how. 3. And the immediate inability to support the onslaught of competitors. All these forced Bajaj to look for an international partner who could bring in technology and also offer some basic platforms to be manufactured and marketed in India. Kawasaki of Japan is a world-renowned manufacturer of high performance bikes. Bajaj entered into a strategic tie-up with Kawasaki in late 1990s to enhance its product line and knowledge up-gradation to support long-term strategies. 27


This served the purpose of sustaining the market competition for a while. From 1996 to 2000, Bajaj invested hugely in infrastructure while simultaneously developing product design and innovation capabilities, which is the prime reason behind the energetic Bajaj of 21st century. Bajaj introduced a slew of products right from entry-level motorcycle to the high premium segment right from 2001 onwards, and since then its raining success all the way for Bajaj. Last quarter, Bajaj had impressive performance growing at a rate of 20% + when the largest manufacturer grew at just 6%. This stands a testimony to the various important strategic decisions over the past decade. 3.2.4 Product Range

Motorcycles 1. Bajaj Pulsar’s: 150 DTSi 180 DTSi 220 DTSi Production: 2001 Present Price: Rs. 58655-83885 Engine: 150 cc/180 cc//220 cc Air-cooled, four-stroke cycle. Power: Upto 21 bhp (14.8 kW) @8500 rpm

2. Bajaj Pulsar 135 LS: Production: Feb 2010 Price Rs. 58000 Engine: 4 Stroke, Air Cooled, DTS-i Power: 13 Bhp @ 9000 rpm Torque: 11.4 Nm @ 7500 rpm

3. Bajaj Discover’s: Discover 135 DTSi 28


Discover 135 DTS-Si Production: 2004 present Price: Rs. 48000 – 52000 Engine: 135 cc Air-cooled, four-stroke Power: Up to 13bhp @ 8500 rpm

4. Bajaj Avenger: Avenger 200 Avenger 220 Production: 2008 present Price: Rs. 70000 Engine: 17.51ps @ 8500 rpm, DTSi Torque: 16.78NM @ 6000 rpm

3.2.5 Exports:

Sri Lanka, Colombia, Bangladesh, Mexico, Central America, Peru and Egypt Overseas Businessman

Mrs. & Mr. Ramiro Villeda, Phd. CPIM, President Veloleda Consulting Group, Inc World Class Value Chain Management Suite 14F, Yan-DangPlaza 107 Yan-Dang Roa Shanghai 200020, P R China Tel.: +86(0)21 63725393/63840513 Mobile : 1(915) 9206150 Fax : 86(0)21 6327617 E-mail: [email protected]/rvilledaconsulting.com Website : www.villedaconsulting.com

29


3.2.6 Balance Sheet of Bajaj Auto Ltd. 2005-06 Table 1.4

Mar ' 06

Mar ' 05

Equity share capital

101.18

101.18

Share application money

-

-

Preference share capital

-

-

Reserves & surplus

4,669.55

4,033.17

Secured loans

0.02

-

Unsecured loans

1,467.13

1,226.99

Total

6,237.88

5,361.34

Gross block

2,894.22

2,765.17

Less : revaluation reserve

-

-

Less : accumulated depreciation

1,761.22

1,628.64

Sources of funds Owner’s funds

Loan’s funds

Uses of funds Fixed assets

Net block

1,133.00

Capital work-in-progress

24.18

8.36

Investments

5,753.45

4,560.58

Current assets, loans & advances

3,062.22

2,662.65

Less : current liabilities & provisions

3,734.97

3,006.77

Total net current assets

-672.75

-344.12

Miscellaneous expenses not written

-

-

Total

6,237.88

5,361.34

247.22

253.59

Net current assets

Notes:

Book value of unquoted investments

30

1,136.53

Study on Two Wheeler Automobile Industry in Mumbai Market value of quoted investments

7,303.41

5,033.64

Contingent liabilities

719.06

573.24

Number of equity sharesoutstanding (Lacs)

31

1011.84

1011.84


3.2.7 Profit & Loss Account of Bajaj Auto Ltd. Table 1.5 Particulars

Mar ' 06

Mar ' 05

7,572.62

5,852.36

Material consumed

5,397.61

4,151.31

Manufacturing expenses

138.59

132.38

Personnel expenses

282.45

250.59

Selling expenses

258.92

257.40

Administrative expenses

240.02

207.78

Expenses capitalized

-24.81

-19.84

Cost of sales

6,292.78

4,979.63

Operating profit

1,279.84

872.73

Other recurring income

369.99

297.93

Adjusted PBDIT

1,649.83

1,170.66

Financial expenses

0.34

0.67

Depreciation

191.00

185.37

Other write offs

4.05

4.04

Adjusted PBT

1,454.44

980.59

Tax charges

479.11

319.63

Incomes:

Operating income Expenses:

Adjusted PAT

975.33

Non recurring items

88.91

660.96 87.11

Other non cash adjustments

59.03

-18.91

Reported net profit

1,123.27

729.16

Earnings before appropriation

1,123.27

729.16

Equity dividend

404.74

252.96

Preference dividend

-

-

Dividend tax

56.76

35.48

Retained earnings

661.77

440.72

32


3.2.7 Board of Directors: Table 1.6 Board of Direct Rahul Bajaj Madhur Bajaj Rajiv Bajaj Sanjiv Bajaj D.S. Mehta Kantikumar R. Podar Shekhar Bajaj D.J. BalajiRao J.N. Godrej S.H. Khan Mrs. SumanKirloskar Naresh Chandra NanooPamnani Manish Kejriwal P Murari Niraj Bajaj

Chairman Vice Chairman & Whole-Time Director Managing Director Executive Director Whole-Time Director Director Director Director Director Director Director Director Director Director Director Director

33


3.3 TVS Motors Ltd. Profile

TVS Motors Company, a leading two wheeler company began with the vision of the founder of the Sundaram Clayton Group, the late T.S. Srinivasan 'to design, develop and produce an affordable moped for the Indian family. This vision was realized in 1980 when TVS 50, India's first two-seater moped rolled out of the factory at Hosur in Tamil Nadu, Southern India. A byword for ruggedness and reliability, the TVS 50 proved to be a promising success and paved the way for many successes for TVS Suzuki ever since. TVS, the first in the country to introduce computerization, achieve high productivity, low cost and consistent high quality, now included extensive programme to install computers at all workstations. Background

Originally incorporated in 1982 to manufacture two-wheelers in collaboration with Suzuki Motors of Japan, TVS was one of the leaders in twowheeler industry. However, disagreement on several aspects including development of TVS brand and exports lead to severance of ties with the joint venture partner in 2002. This forced the company to develop its own R&D expertise and commit itself to sizeable investment. It has presence in all the segments viz. motorcycle, scooterettee and moped. TVS Scooty (scooterettee) and TVS Victor (Executive segment - motorcycle) are its key brands. The company has also launched 2 new fuel-efficient bikes - `Centra' and `Star'. Vision

Our vision is the creation of an India which is a global destination for innovative product development and thought leaders in integrated product and process development with a focus on improving the quality of life, including that of the poorest of the market segments at the bottom of the pyramid. Mission

34


Our mission is to improve the capabilities of people engaged in the design and development of new products and services, to encourage innovation in product development and effective management of the product development processes. 3.3.1 Organizational structure of TVS motors company ltd.

3.3.2 SWOT Analysis:

Strengths ➢ ➢ ➢

Ability to understand customer’s needs and wants Recognized and established brand name Effective advertising capability 35


Weaknesses ➢ ➢ ➢

They have big gap between cubic capacities of its products. Its market share is reducing from last few years. Bikes are not attractive as compare to there competitors.

Opportunities ➢ ➢ ➢

Global expansion Expansion of target market (include women) Become India’s leader in the scooter market

Threats ➢ ➢

Suzuki Motorcycles can take away market share and cause joint venture to go sour Bajaj Motors and Hero Honda is a strong competitor.

3.3.3 Products: 1. TVS Apache’s: Apache RTR 160 Apache RTR 160 Fi Apache RTR 180 Production: 2004 present Price: Rs. 62000 – 72000 Engine: 160cc/ 160 fi / 180cc air – cooled Four – stroke Power: Up to 17.3 bhp @ 8500 rpm Torque: Up to 15.5NM @6500 rpm

2. TVS Scooty Pep Plus: Production: 2004 present Price: Rs.38853 Engine: 4 stroke,87.8 cc Power: 3.68kw (5 bhp) @ 6500rpm

36


3. TVS Star City: Production: 2004 present Price: Rs. 42856 Engine: 4 – Stroke,99.7 CC Power: 7.5 bhp / 5.50 kW @ 7500 rpm

4. TVS Victor GLS: Production: 2004 present Price: Rs. 46570-48986 Engine: 4 – Stroke,124.8 CC Power: 10 bhp / 6.77 kW @ 7500 rpm

5. TVS Jive: Production: 2010 present Price: Rs. 42235 Engine: 4 – Stroke, 109.7 CC Power: 8.4 bhp / 6.18 KW @ 7500 rpm

6. TVS Flame DS: Production: 2010 present Price: Rs.48,990 onwards Engine: 4 – Stroke CC-VTi, 124.8 CC Power:10.3 bhp / 7.7 KW @ 7500 rpm

37


3.3.4 Board of Directors: No.

Name of the Directors

Designation

1

Mr. VenuSrinivasan

Chairman & Managing Director

2

Mr. GopalSrinivasan

Director

3

Mr. T.K.Balaji

Director

4

Mr. T. Kannan

Director

5

Mr. N. Ganga Ram

Director

6

Mr. C.R.Dua

Director

7

Mr. H. Lakshmanan

Director

8

Mr. T. R. Prasad

Director

9

Mr. K.S.Bajpai

Director

10

Mr. K.N. Radhakrishnan

President

11

Mr. S. G. Murali

Sr.Vice President – Finance

12

Mr. T.S.Rajagopalan

Secretary

38


3.3.5 Balance Sheet & Profit and Loss A/c of TVS Motors:

39


40


3.4 Honda Motorcycles and Scooter India (Pvt.) Ltd. Honda is the world's largest manufacturer of 2-wheelers. Its symbol, the Wings, represents the company's unwavering dedication in achieving goals that are unique and above all, conforming to international norms. These wings are now in India as Honda Motorcycle & Scooter India Pvt. Ltd. (HMSI), a wholly owned subsidiary of Honda Motor Company Ltd., Japan. These wings are here to initiate a change and make a difference in the Indian 2-wheeler industry. Honda's dream for India is to not only manufacture 2-wheelers of global quality, but also meet and exceed the expectations of Indian customers with outstanding after sales support.

About Honda Motorcycle & Scooter India Pvt. Ltd. Table 1.7

Official Name Established Place Investment Representative Factory Location Production Capacity

Honda Motorcycle & Scooter India Pvt. Ltd. 20th Aug, 1999 Manesar, District Gurgaon, Haryana, India Rs. 300 Crore Mr. Shinji Aoyama, President & CEO Manesar, District Gurgaon, Haryana, India 10,000,00 Units per Year

Honda's dream for India is to not only manufacture 2-wheelers of global quality; but also meet and exceed the expectations of Indian customers with outstanding after sales support. They aim to produce technologically superior, efficient and reasonably priced 2-wheelers, with Honda tested technology, backed up with after sales service of Honda's global standard. Corporate Profile:

Honda Motor Co., Ltd., operates under the basic principles of "Respect for the Individual" and "The Three Joys"-commonly expressed as The Joy of Buying, The Joy of Selling and The Joy of Creating. Respect for the Individual" reflects our desire to respect the unique character and ability of each individual person, trusting each other as equal partners in order to do our best in every situation. Based on this foundation of Respect for the Individual, "The Three Joys" expresses our belief and desire that each person working in, or coming

41


into contact with our company, directly or through our products, should share a sense of joy through that experience. In line with these basic principles, since its establishment in 1948, Honda Motor Co., Ltd., has remained on the leading edge by creating new value by providing products of the highest quality at a reasonable price, for worldwide customer satisfaction. In addition, the Company has conducted its activities with a commitment to protecting the environment and enhancing safety in a mobile society. The Company has grown to become the world's largest motorcycle manufacturer and one of the leading automakers. With a global network of 454* subsidiaries and affiliates accounted for under the equity method, Honda develops, manufactures and markets a widevariety of products ranging from small general-purpose engines and scooters to specialty sports cars, to earn the Company an outstanding reputation from customers worldwide. Mission Statement

Maintaining a global viewpoint, we are dedicated to supplying products of the highest quality at a reasonable price for worldwide customer satisfaction

42


Organization Structure: Table 1.8

3.4.1 SWOT Analysis

Strength ➢ ➢ ➢

Reliable brand name Affordable price Honda have a big share of market in scootreats segment 43

Study on Two Wheeler Automobile Industry in Mumbai ➢ ➢ ➢

Honda is the first company who introduced the technology of central shock absorption in India Honda having high tech engines HMSI is the subsidiary company of Honda Motors Ltd. Which is the largest company in the proposed sector

Weakness ➢ ➢

➢ ➢ ➢

Less number of service center Market share very less as compare to there competitor Spares parts are not easily available Low product range Maintenance cost is very high

Opportunity ➢ ➢ ➢ ➢

Increase in product range Untapped market above 180 cc in motorcycles. More maturity and movement towards higher-end motorcycles Honda can be use brand image of Hero Honda

Threats ➢ ➢

There is high competition in the market Threat of cheap imported motorcycles and components from China

3.4.2 Products:

Scooters 1. Honda Activa: Production: 2004 present Price: Rs. 48500 Engine: 110cc 4 stroke air cooled Power: 8bhp @ 7500 rpm Torque: 9NM @ 8500rpm

44


2. Honda Dio: Production: 2004 present Price: Rs. 44000 Engine: 4 – Stroke 102cc OHC Power: 7bhp@7000rpm

Motorcycles 1. Honda Unicorn: Production: 2004 present Price: Rs. 67000 Engine: 4 – stroke 149.1cc Power: 13.3 bhp @ 8000rpm Torque: 1.3kgm @ 5500rpm

2. Honda Shine: Production: 2004 present Price: Rs.56200 Engine: 4-Stroke 124.6 cc Power: 10.3 bhp @ 7500 rpm

3. Honda CBF Stunner: Production: 2009 present Price: Rs. 52800 Engine: 124.7cc 4 stroke Power: 11bhp @ 8000rpm Torque: 11Mn @ 6500rpm

4. Honda CB Twister: Production: Jan 2010 Price: Rs. 53000 45


Engine: 109cc, 4 - stroke OHC Power: 9bhp @ 8000rpm Torque: 9Nm @ 6000rpm 3.4.3 Global Expansion

As seen above HMSI has its networks world wide. Corporate Details HONDA MOTORCYCLE & SCOOTER INDIA (Pvt.) Ltd. Plot No. - 1, Sector - 3 IMT Manesar, Distt. Gurgaon Haryana - 122 050 Phone: + 91 - 124 -6290911, 6290919, and 6290926-28 Fax: +91 - 124 - 6290891, 6290890 HONDA MOTORCYCLE & SCOOTER INDIA (Pvt.) Ltd. 406, Level Four, Prestige Centre Point Edward Road Bangalore 560 046 Phone : +91 - 80 - 2282419, 2384090, 2384091 Fax : +91 - 80 - 2282409 Head Office: 46


2-1-1 Minami Aoyama, Minato-kuTokyo 107-8556, Japan Tel: +81-(0)3-3423-1111

47


3.5 Yamaha Motor India (YMI) Holding the true spirit of commitment to customer satisfaction - Yamaha Motor India is enriching lives of people with the same ingenuity and enthusiasm as its parent company - Yamaha Motor Corporation, Japan. Having operated in India as technology technology provider provider for almost two decades, decades, YMI was incorporated incorporated in August 2001 as a 100'% subsidiary of YMC, Japan. Since then we have been in the process of redefining our business processes and extending the awe and power associated with the legacy of the Yamaha Group. Adhering to our Corporate Mission - "Creating Creating Kando -Touching -Touching Your Heart " we are striving to touch every Heart across the length and breadth of India We firmly believe in “ Surpassing Surpassing Customer Expectations ”

We are aware of our customers' evolving needs and provide them with quality products and services of exceptional value that surpass their expectations. Establishing a Corporate environment that fosters self-esteem

We believe in nurturing and empowering our employees to the fullest. Whilst cultivating our employees’ creativity and all round abilities, we have also established an equitable system of evaluation and rewards to encourage our people to strive towards newer benchmarks. Fulfilling social responsibilities

As a good corporate citizen, we continually strive towards creating a better social as well as natural environment. Vision and Mission:

We conduct our corporate activities with customer satisfaction as our top priority. Our clients in the Yamaha Motor group and many companies outside the group are mostly manufacturers that are involved in programs to improve the full range of their business activities, from product manufacturing, distribution and 48


sales to financing, administration, and corporate governance. We are striving to help these clients achieve a higher level of satisfaction for people using their products. Toward this end we are actively expanding our business in Japan and worldwide. At Yamaha Motor Solutions we are working to become a world-class leader in our our fiel field d by bringi bringing ng toge togeth ther er the the accu accumu mula late ted d abil abilit itie iess and and skil skills ls our our indi indivi vidu dual al empl employ oyee ee's 's into into dyna dynami micc team teamss capa capabl blee of crea creati ting ng valu valuee that that surpasses the expectations of our clients.

3.5.1 Organization chart

49

Study on Two Wheeler Automobile Industry in Mumbai M umbai Table 1.9

3.5.2 SWOT Analysis

Strengths ➢ Yamaha motors India is the subsidiary company of Yamaha motors ltd, which is the MNC company having a good brand name. ➢ Good share in Indian two wheeler automobiles sector ➢ It is the one of the oldest company in the Indian market. ➢ Bikes are available at competitive price. ➢ Popular in rural area. Weakness ➢

No presences in scooter segment. ➢ No presences in above 150cc bike segment. ➢ Decreasing market share 50

Study on Two Wheeler Automobile Industry in Mumbai ➢ ➢

Limited network. Less average

Opportunities ➢ ➢ ➢ ➢

Above 150cc bike segment having full of opportunities. Set targets on scooters segment. Target youth. Large market is available for consumption.

Threats ➢

Large no, of competitors present in the market. ➢ New companies are watching Indian market. ➢ People are going for good average and stylish bikes. ➢ E-bikes are also in the market. 3.5.3 Products: 1. Yamaha YBR Production: 2010 Price: Rs. 54000 Engine: 123cc, 4 - stroke SOHC Power: 11 bhp @ 7500rpm

51


2. Yamaha SZ – Series Yamaha SZ-X Yamaha SZ-R Production: 2010 Price: Rs. 58000-63000 Engine: 153cc, 4 - stroke SOHC Power: 12 bhp @ 7500rpm 3. Yamaha FZ – Series Yamaha FZ - 16 Yamaha FZ - S Yamaha FZ – Fazer Production: 2008 to present Price: Rs. 73000-81000 Engine: 153cc, 4 - stroke SOHC Power: 14 bhp @ 7500rpm 4. Yamaha R15 Production: 2008 to present Price: Rs. 1,12,000 Engine: 153cc, liquid colled, 4 - stroke Power: 17 bhp @ 8500rpm

52


3.5.4 Corporate Profile: Table 1.10

Name: Location:

Board of director: Director:

Employees: Sales:

Offices: Overseas subsidiary

Yamaha motors ltd. 2000-1 Iwai, IwataCity, Shizuoka Pref. Post Code: 438-0016 Telephone: 0538-39-2213 Facsimile: 053839-2219 President and Representative Director@YasuharuTerai Takuya Watanabe TetsuroNabata Mitsuyoshi Suzuki Takeya Harada 245 (As of January, 2006) 4.5 billion yen (As of FY ended December, 2005) 6 billion yen (Projected FY ending December, 2006) Head office (IwataCity, Shizuoka Pref.) Iwata Office (IwataCity, Shizuoka Pref.) Yamaha Motor Solutions Co., Ltd. Xiamen (Location: Amoy City, Fujian Prov.) Yamaha Motor Solutions India Pvt. Ltd. (Location: Surajpur (UP state), India )

3.5.4 Exports:

YMI is an active player in the exports market. Currently, we export motorcycles to 50 countries including Argentina, Mexico, Philippines, Bangladesh, Sri Lanka, Columbia, Dominican Republic, Nigeria and lvoryCoast. The export Product line boasts of RX 100, Crux, YD 125, Enticer and Libero. To consolidate our position in the exports arena, we are rapidly expanding our presence in Asia, Africa, Central and South America. Strengthening our reputation as an export base for YMC global operations, we are bright and optimistic about our emergence as a top-notch bike exporter of India.

53


3.5.5 Balance Sheet of Yamaha Motors India: ASSETS Table 1.11

(Amt. in Millions)

Mar. 2003

Mar. 2004

25,475

37,318

Dec. 2004

Dec. 2005

Dec. 2006

Current Assets Cash and deposits in bank

37,194

38,809

79,299

Trade notes and accounts 135,012 137,027 145,582 206,213 223,082 receivable Inventories

160,232 159,235 204,232 251,227 297,853

Other

43,724

Total current assets

364,444 374,666 430,424 554,924 671,021

41,085

43,414

58,673

70,785

Fixed assets Tangible fixed assets

280,950 274,863 283,411 323,846 361,837

Intangible fixed assets

4,303

Total investments and other 49,388 assets

2,957

3,273

3,075

4,281

49,436

50,618

76,630

91,548

Total fixed assets

334,642 327,256 337,303 403,552 457,667

Total assets

699,087 701,923 767,727 958,476 1,128,688

LIABILITIES

Current liabilities Notes and accounts payable 112,934 132,291 143,531 176,000 187,419 Short-term loans

48,073

49,639

71,390

100,097 127,341

Current portion of long-term 20,823 debt

12,690

8,190

20,885

8,568

Current portion convertible bonds

-

10,000

5,000

-

8,500

7,000

6,991

15,000

of 24,326

Commercial Paper

21,376

Other

126,248 131,030 132,971 164,246 180,195

Total current liabilities

353,784 334,151 373,083 473,221 518,525

54


Long-term liabilities Bonds

44,893

23,712

8,001

295

63

Long-term debt

39,935

23,994

16,064

20,747

44,235

Other

68,120

56,493

57,064

55,587

64,809

Total long-term liabilities

152,951 104,200 81,129

76,629

109,108

Total liabilities

506,735 438,351 454,213 549,850 627,633

Minority Interest Note

12,199

14,165

19,752

24,730

-

NET ASSETS (SHAREHOLDER'S EQUITY) Table 1.12 Owners' equity

Common Stock , with 23,251 no par value

43,439

46,362

47,879

48,168

Capital surplus

34,419

54,618

57,543

60,361

60,651

Other

122,481

151,348

189,855

275,655

343,371

Total owners' equity

-

-

-

-

452,190

and adjustment -

-

-

-

18,442

Minority Interest Note 1)

-

-

-

30,421

Total equity

249,406

293,761

383,895

501,054

Valuation translation 2)

shareholder's

180,151

55


Graph 1.2

Market share of tw o w heeler autom sector Hero Honda

35.60%

27.50%

Bajaj Motors TVS M otors Yamaha Motors Honda M otor Others

9.50%

16% 4%

7%

Graph 1.2 shows the overall market share of two wheeler sector in India. The market is dominated by Hero Honda by 35.60% share followed by Bajaj in the second place with 27.50% market share. TVS motors stands in third place with 16% share and the rest occupy a combined of 20.5% share.

3.6 Current Sales of Two Wheeler’s in India: As seen in the graph below, it is clearly visible that Hero Honda is still leading the two wheeler market both in Mumbai as well as in India with majority of d sales coming from major metropolitan cities. There has been huge boost in the two wheeler industry over the past couple of years. More emphasis is being laid on the youth of the country.

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3.7 Retailing Strategies: Hero Honda: On the back of the festive season Hero Honda the world’s no.1 two wheeler company, has posted its highest ever monthly sales figure. Hero Honda total sales grew by massive 42.75% in October 2010 compared to October 2009. Total sales stood at5,05,553 units of two wheelers in October 2010 compared to 3,54,156 units in October 2010. Hero Honda recorded sales of 4,35,990 units in May 2010 which was its previous highest monthly sales figure. This is by far highest ever monthly sales for any Indian two wheeler company till the date. The company also reported month on month basis sales growth of 16.58% due to festive season. Last month the company sold 4,33,641 units. The company 57


sold 30,25,536 units during April 2010 to October 2010 up 13.89 % compared to 26,56,378 units in the same period last year. Commenting on the record sales, Anil Dua, Sr. Vice-President (Marketing & Sales), Hero Honda Motors Ltd said, “This record of over half –a-million sales in a single month created by the company is extremely encouraging as it clearly demonstrates the confidence our customers have in our brands. Sales of over five lakh units in a month with a 42.7 % growth over the large base of the previous year is a testimony to the winning strategy that we have been following over the past few years. A refreshed product range coupled with innovative branding and marketing initiatives – particularly revolving around the Commonwealth Games Delhi 2010 – can duly be attributed to this success. FY’ 2011 has been a magnificent run for Hero Honda as we have been consistently scaling new heights. The company has been on a record sales run of over four lakh units each month since May, capping it off with the 5-lakh plus mark in October. Going forward, we are hopeful of continuing the momentum by staying true to the same winning strategy.” Hero Honda which has launched 6 new models in the last six months which includes refreshed model of Glamour and Glamour FI, Super Splendour, Hunk, Passion Pro and Splendour Pro. Recently launched Splendour Pro which now comes with APDV (Advance Pro Series Digital Variable Ignition System) engine has witnessed good nos. Beside this Hero Honda has launched Passion Pro Commonwealth Games Limited Edition. Notably the company has installed capacity of 5.6 million units per annum with 3 manufacturing plants and it has goal of selling 5 million units in current fiscal up 8.7% from last year. The company is also looking for setting up 4th manufacturing plant. Bajaj Auto: On the back of strong festive season Bajaj auto reported its highest ever monthly sales. Bajaj auto reported sales growth of 32.21% in the month of October 2010 compared to October 2009. The company sold 3,70,816 units in October 2010 compared to 2,80,455 units in the October 2009 which is highest ever in the company history. Motorcycle accounted 3,29,776 units in the month of October 2010 up 32.08% compared to 2,49,681 units in October 2009. Month on month basis the company has reported 4.85% growth in October 2010 compared to September 2010. The company sold 3,14,515 units in the month of September 2010. 58


The company has exported record 1,10,387 units in September 2010 up 31.39% compared to 84,012 units in the same period last year. The company has reported motorcycle sales of 20,41,661 units during April to October 2010 up 53.27% compared to 13,32,049 units sold in the same period. The company has attributed it strong sales to Pulsar and Discover brand. The company posted highest ever sales of Pulsar 94,598 units and discover around 1,45,000 units in the October 2010. The rest of the sales shared equally between Boxer and Platina brand. The company is aiming to sell 3,50,000 motorcycle a month from January 2011. Tvs Motors: TVS Motors has reported its highest ever monthly sales on the back of festive seasons. The company two wheeler sales grew by 46.40% in the month of October 2010 compared to October 2009. The company sold 1,91,822 units of two wheeler in the month of October 2010 compared to 1,31,029 units in the month of October 2009. The company’s total sales stood at 1,95,271 units in the month of October 2010 up 48.00% compared to 1,31,941 units in the month of October 2009. However the company has reported month on month basis sales growth of 3.81%. The company sold 1,84,783 units in the month of September 2010. Cumulative two wheeler sales for the period April to October 2010 stood at 11,62,861 units up by 33.89% compared to 8,68,509 units in April to October 2009.

Domestic sales stood at 1,73,771 units in the month of October 2010 up by 45% compared to 1,18,563 units in the month of October 2009. Export stood at 18,051 units in the month of October 2010 up by 45% compared to 12,466 units in the month of October 2009. Motorcycle sales stood at 84,233 units in the month of October 2010 up by 49% compared to 56,465 units in the month of October 2009. Scooter sales stood at 44,659 units up by 58% compared to 28,301 units in the month of October 2010. HMSI: India’s largest scooter manufacturing company Honda Motorcycle & Scooter India Ltd reported growth of 148% in the month of October 201 0. The company reported sales of1,48,861 units in the month of October 2010 compared to 60,055 units in the October 2009. It is to be noted that last year the production was very low due to strike by workers for wage dispute. On month on month basis the company reported sales growth of 20 %. The company sold 1,23,831 units in the month of September 2010. The company 59


sold9,58,492 units during April 2010 to October 2010 up 47 % compared to 6,51,575 units during the same period last month. On the back of strong demand for its 100 cc CB Twister HMSI posted sales of 68,332 units of Motorcycle in October 2010 up by 215% compared to 21,721 units sold in October 2009. The scooter segment also witnessed sales of 80,529 units in October 2010 up by 110% compared to 38,334 units sold in October 2009. HMSI is growing at very fast rate but the sales are constrained by capacity. It has expanded its capacity form current 1.6 million units to 2.2 million units but it seems that the company has to go for another capacity expansion as demand remain strong in Indian two wheeler industry. It is also to be noted that company is planning to launch a new 100cc bike which is priced lower than its current 100cc offering CB Twister. Yamaha India : Yamaha India has reported sales growth of 19.21% in the month of October 2010 compared to October 2009 on the back of new launches like SZ and SZ-X. Total sales stood at 37,251 units in the month of October 2010 compared to 31,247 units last year in the same period. The company reported month on month basis sales growth of 9.74%. The company sold 33,944 units in the September 2010. Domestic sales stood at 31,791 units up by 18.27% compared to 26,879 units in the month of October 2009. Export stood at 5,460 units up by 25.00% compared to 4,368 units in the month of October 2009. The company sold 2,09,521 units during April to October 2010 period up by 25.56% compared to1,66,868 units during the same period last year.

On the announcement of monthly sales figure, Koji Arai, Director – Sales & Marketing, India Yamaha Motor said, “We are overwhelmed with the encouraging response we have been receiving for our premium segment bikes such as YZF-R15 & FZ series including new limited edition FZ series bikes. Our recently launched powerful commuter SZ models and entry level bikes – YBR 125 and YBR 110 have also been acknowledged in the market and have boosted our sales. We are trying our level best to fulfill the huge orders and meet the expectations of our esteemed customers this festive season.” Yamaha India wants to establish itself as a global brand among the Indian consumers. The company is doing it by conducting various marketing activities such as Yamaha R15 One Make Race, Yamaha Safe Riding Science (YSRS) for college students & kids. 60


Suzuki Motorcycles: With the successful launch of Suzuki Slingshot Suzuki Motorcycle India reported massive growth of 60.51% in the month of October 2010 compared to October 2009. The company’s total sales stood at 25,439 units in the month of October 2010 compared to15,849 units in the month of October 2009. The company has reported month on month basis sales growth of 12.89%. The company sold 22,534 units in the month of September 2010. Suzuki motorcycle sold 1,46,157 units during April to October 2010 up 53.07% compared to 95,717 units in the same period last year.

“We have received very good response from the market to all our products including the newly-launched, Suzuki SlingShot. We are committed to continue this growth momentum in future.” Suzuki Motorcycle India Vice President (Sales and Marketing) Atul Gupta said in a statement. The company attributed its growth to the good response from its motorcycle GS150R, scooter Access125 and the recently launched bike SlingShot. Mahindra Two Wheelers: World’s fastest growing two wheeler company Mahindra two wheeler reported growth of 212% in the month of October 2010 compared to October 2009. Total sales stood at21,204 units in the month of October 2010 compared to 6,804 units in the month of October 2009. The scooter sales stood at 18,540 units in the month of October 2010 up by 172.49% compared to 6,804 units in the month of October 2009. In the motorcycle segment where Mahindra Two wheeler has launched two new bikes Sattalio and Mojo on September 29 2010 reported sales of 2,664 units. Month on Month basis the company has reported sales growth of 28%. The company sold 16,569 month last month. Total cumulative sales from April to October 2010 stood at 92,034 units up by 304% compared to 22,758 units for the same period last year.

“Consumers have laid their trust in the Mahindra Two Wheeler brand and this is borne out from the momentum that is reflected in our monthly sales figures. We have achieved a double digit market share in scooters last month and our consumer base is growing rapidly. This month we have also embarked on our motorcycle journey with the launch of Stallio and the initial response has been very encouraging.” said Mr Anoop Mathur, President Two Wheeler Sector and Member of Group Executive Board Mahindra & Mahindra.

61


62


4. Consumer Profile: One of the key reasons for the increased consumption of two wheelers is the impressive growth of the middle class. Bikes play a key role in the life of a middle class person. It allows a middle class person to compute from one place to another while not being very heavy on the pocket. A two wheel automobile is highly favored by the young age mass because it’s easier for them to compute from one place to another without being much burden on the financial level. The youth prefer it more also because it helps them to cut through traffic without waiting much in the heavy city traffics. Many cant effort the big sports bikes like the R1, Hayabusa or the Ducati, so consumers go for the commuter level of motor cycle fulfilling part of owing a sports bike. Looking at this scenario manufacturers are coming up with sports model of Indian bikes which is just a younger sibling of the sports bikes which the consumers can effort to buy and use it on a day to day level. For e.g Yamaha R15 which is replicate of the Yamaha R1 and also Kawasaki Ninja 250 which has a smaller engine compared to the older sibling Ninja ZR 1000. Keeping in mind the following thoughts a survey was conducted targeting the youth mass specially college going students of middle class mostly to find out which bike they owned, what do they look for in a bike and many other reasons. The sample size is large enough to gauge the views of the people belonging to various age groups and thus enable us to get an unbiased opinion. The target audience has been divided into three different age groups for analyzing. The age groups are as follows: Table 1.13

Age Groups 18 – 24 24 – 30 30 Above

Number of Persons 45 3 2

The gender wise bifurcation of the target audience is as under: Table 1.14

Age Groups

Male

Female

63

Total


18 – 24 25 – 30 30 Above

40 3 2

5 0 0

45 3 2 50

The majority of the people interviewed were male and in the age group 18 – 24. The main reason behind it being because of the craze, passion and enthusiasm which the youngsters have in them for Bikes. Based on the interview of the target audience the researcher was able to come up with the various analysis and interpretation to support the hypothesis. The findings are mentioned in the next chapter.

64


5. Analysis and Interpretation: After preparing the questionnaire and compiling all data collected, the researcher interpreted the various data in the following manner. 5.1 Total population and age wise classification. Graph 1.3 Table 1.15 Respondent

No. of Respondent

Total Percentage

Male

45

90

Female

5

10 100

Graph 1.4

d p R N s e e o o n o f n s . t

Age Groups

Table 1.1 shows the no. of respondent and the total percentage. The researcher has found that ninety percent are male and ten percent are female. The X-axis depicts the age groups and the Y-axis depicts the total no. of respondents. The total no. of respondents wasfifty out of which forty five were 65


males and five were females. They were divided under the age groups 18-24, 25-30 and 30 above. The majority of the people interviewed were male and in the age group 18 – 24. The main reason behind it was because of the craze, passion and enthusiasm which the youngsters have in them for Bikes. 5.2 Bike Owned

Graph 1.5

Table 1.16 Respondent

No. of Respondent

Total Percentage

Yes

50

100

No

0

100

Graph 1.6

o R n e o N t s d f o e s . n p

Table 1.2 shows the no. of respondent and the total percentage.As seen above in the pie diagram 100 percent of the masses interviewed have a bike. In the below graph the gender wise bifurcation of the same can be seen. The Xaxis shows the age groups and the Y-axis shows the total number of respondents. The researcher interviewed majority of male in the age group 1824 because this age group is the most passionate about bikes.

Age Groups

Age Groups

66


5.3 Brand of Bike Owned Table 1.17 Respondent Hero Honda Honda

No. of Respondent 10 13

Total Percentage 19 25

Yamaha TVS

11 2

21 4

Bajaj

10

19

Royal Enfield

5

10

Suzuki

1

2 100

Graph 1.7

n m C i p e s a o

Table 1.3 shows the different brand of bikes which the respondents own, the total responses and the total percentage.The X-axis depicts the total no. of bikes owned and the Y-axis depicts the company/brand of bike owned. The researcher found out that Honda out numbers the remaining companies with twenty five percentshare. Only the youth seem to own the Honda. Next to follow Honda is Yamaha with twenty one percent, again majority of it being owned by the youth. Hero Honda and Bajaj share an equal market share of nineteen percent each. Royal Enfield holds a decent ten percent share. Suzuki is the least owned bikes amongst all and it’s owned by the older age group of people.

Total No. of bikes owned

67


5.4 Class of Bike Table 1.18 Respondent 100cc – 135c

No. of Respondent 17

Total Percentage 33

150cc – 160cc

22

42

180cc – 200cc

3

6

200cc and above

10

19 k b o o N d n w o s e i f . 100 e

Graph 1.8

Table 1.4 shows the different class of bikes in the market, the respondents who own them and their total percentage. The X-axis shows the class of bikes owned by the different age groups and the Y-axis shows the number of bikes owned by the people. The researcher has found out that forty one percent of the people have bikes in the class 150cc to 160cc and then followed by thirty four percent of the people holding bikes in the class 100cc to 135cc. The youths dominate in the class 150-160cc along with nineteen percent in the class 200cc and aboveeven thought a less number of youths own it. The drawback here seen is only six percentof the total people interviewed have bikes in the class 180cc – 200cc even though bikes in this class price less than the ones in the 200cc and above category.

Class of Bike

68


5.5 Performance over Mileage?

Graph 1.9


No. of Respondent

Total Percentage

Yes

38

76

No

12

24 100

s R o o n d o s t e n p e f . N

Graph 1.10

Table 1.5 shows the total number of respondent and the total percentage. The researcher has found out that seventy six percent of the population interviewed preferred performance i.e. power, speed, pickup over mileage (average). The majority of the population who preferred performance over mileage was found in the age group 18-24 i.e. the youth. The older age of people i.e. in the age group 30 and above were totally against performance, they favored more mileage than performance.

Age Groups

69


5.6 Price Range

Graph 1.11


Less than 50000 50000 – 75000 75000 – 90000 More than 90000

No. of Respondent

Total Percentage

2

4

23

46

16

32

9

18

100 Graph 1.12

d p R N s e e o o n o f n s . t

Table 1.6 shows the price range of bikes, the total number of respondents and the total percentage. The researcher found out that the respondents in the age group 30 and above preferred bikes less than rupees fifty thousand. The most favored price range was between rupees fifty thousand toAge seventy Group five thousand and the age group liking it the most was the youth i.e. in the age group 18-24. A large amount of people also favored bikes in the price range seventy five thousand to ninety thousand. Bikes in the price range ninety thousand and above received a decent response.

Price Range

70


5.7 Brand Loyalty Table 1.21 Respondent Hero Honda

Total Percentage 18

Honda

No. of Respondent 10 17

Yamaha

10

19

TVS

2

4

Bajaj

8

15

Royal Enfield

6

11

Suzuki

1

2 100

31

n o e b o N a T Graph 1.13 e l o k f o d w s i t .

Table 1.7 shows the different brand of bikes which the respondents are loyal towards, the total responses and the total percentage. The researcher found out that thirty one percent of the respondents are loyal towards Honda; nineteen percent are loyal towards Yamaha, eighteen percent towards Hero Honda and fifteen percent towards Bajaj. Royal Enfield, TVS and Suzuki fail to capture the hearts of the consumers. The respondents in the age group 30 and above preferred Bajaj and Suzuki while the other age group preferred more of Honda, Yamaha and Hero Honda. Yamaha and Hero Honda had a very close margin of loyalty of consumers towards them. 5.8 Satisfactory after sales service Graph 1.14


No. of respondent

Total Percentage

Yes

43

86

No

7

14

Companies

100 o Graph 1.15 s e n o n e s f o d p R

N

t

.

71


Table 1.8 shows the total number of respondent and the total percentage. The responder found out that eighty six percent of the respondents were satisfied by the after sales service provided to them by their bike manufacturer. The only group which was not satisfied with the after sales service was the age group 30 and above. In the age group 18-24 ninety percent were satisfied with the after sales service whereas the remaining ten percent weren’t.

Age Groups

72


5.9 Looks in a bike Table 1.23 Respondent Performance Mileage

No. of respondent 20 10

Total Percentage 29 14

Styling

15

21

Technology

5

7

Pricing

1

2

All of the Above

19

27 100

Graph 1.16 Segments

R N e e s n p o . t s o n o d f

Table 1.9 shows what the respondents want in a bike, the number of respondents and the total percentage. The responder found out that majority gave preference to performance then followed by all of the above features. The all of the above feature included – performance, mileage styling, technology and pricing. After this most preference was given to the styling of the bike. Technology and pricing played a very less role compared to the others.

73


5.10 Will you wait?

Graph 1.17


No. of respondent

Total Percentage

Yes

34

68

No

16

14 100

Graph 1.18

Age Groups

d p R o N s e e n o f o . t n s

Table 1.10 shows the total number of respondent and the total percentage. The researcher found that sixty eight percent of the respondents were willing to wait for the bikes of their choice if the bikes were in a waiting period. Majority were willing to wait in the age group 18-24. The respondents in the age group 30 and above were not willing to wait for the bikes of their choice if it was not available in the market when required.

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5.11 Safety Features Graph 1.19


No. of respondent

Total Percentage

Yes

40

80

No

10

20 100

Graph 1.20

Age Groups

d p R o N s e e n o f o . t n s

Table 1.10 shows the total number of respondent and the total percentage. The researcher found out that eighty percent of the respondents wanted bikes to come up with ABS (Anti-lock Breaking System) breaks as a standard option in bikes. The youth favored it extensively where as some dint like it for their own personal reasons. In the age group 25-30 every one favored for the ABS brakes. Whereas in the age group 30 and above there was an equal balance. 75


6. Findings and Conclusion: 6.1Findings:

6.1.1 6.1.2 6.1.3 6.1.4 6.1.5

Every one interviewed had a bike of their own. Majority had Honda followed by Yamaha. The youth preferred Yamaha bikes when it came to performance. The majority of the youth had bikes in the class 150cc – 180cc. The youth clearly wanted performance from their bikes rather than good mileage. 6.1.6 Seventy six percent of the people interviewed favored for performance over mileage. 6.1.7 Majority of the people preferred buying bikes in the class 150cc – 160cc. 6.1.8 There also preferred bikes of 200cc and above. 6.1.9 When it came to brand loyalty Honda Motors clearly outnumbered over the rest and being the first choice over the other brands available in the market. 6.1.10 The after sales service provided by the bike manufacturers was satisfactory to eighty six percent of the respondents interviewed. 6.1.11 Given the option of performance, mileage, styling, technology, price and all of the above option which of these a consumer would choose while purchasing a bike 27% picked all of the above option. Whereas performance was favored by 29%, styling was favored by 21%, mileage was favored by 14% and pricing and technology had a total of 9%. 6.1.12 68% of the respondents were ready to wait for the bikes of their choice if the bikes were in a waiting period. This just shows that how much loyal they are towards the brand which they are going to buy. 6.1.13 When asked if they would prefer bikes to come up with ABS brakes as a standard option an astonishing 80% of the people wanted manufacture’s to come with this safety option. 6.1.14 They also preferred safety features like:  Tubeless tires  Free helmets  Air bags in bikes  Double disc breaks  Xenon vision head lights  Free leg guards

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Conclusion:

6.1.1 The study which conducted on the two wheeler automobile sector is a very important topic of automobile sector. 6.1.2 Two wheeler automobile sector is the backbone of the automobile sector in India. After deep research, analysis and getting information about companies as formulated that the two wheeler automobile companies achieved success in the market. 6.1.3 Throughout the study I found the Two wheeler manufacturer having very new and modern technology in their bikes, they have a good market share in India, many of MNC's like Honda, Yamaha ,Suzuki are also giving large competition. 6.1.4 Concluding the performance of the company related to two wheeler sector in India, getting their market share and growth and what are services they are providing after sales. 6.1.5 With newer and better models are coming up customer has better and bigger choices to choose from. 6.1.6 It is the competition on various aspects such as price, design technology, after sales services and even purchases offers, which provides to both buyer and seller. 6.1.7 Even many dealers are in view that today Hero Honda and Bajaj, thrives on competition. 6.1.8 Right now it seems that the real war is between Hero Honda and Bajaj auto. But one cannot discount the fact that there are other players, who are gaining strength day by day especially Yamaha Motors after its launch of two new bikes in the 150cc segment the FZ -16 and the YZF R15. 6.1.9 Companies are now trying to launch bigger capacity bikes in India i.e. 2500cc and above as the craze for sports bikes is increasing day by day in the youth. Bajaj motors has recently launched the Kawasaki Ninja 250 in the collaboration with the Kawasaki Motors Philippines – the official distributor to Bajaj.

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7. Recommendations: After completing my report on the Two Wheeler Automobile Industry in Mumbai I have the following suggestions/ recommendations to give: i. The companies should give more emphasis to performance and styling in a bike rather than mileage which is highly favored by the youth. ii. Companies should come with more 150cc – 160cc bikes which is not heavy on pockets of the middle class people and also gives a satisfying performance out of it. iii. Safety feature such as ABS brakes should be made as a standard feature which the people want as seen in the survey. iv. Tubeless tires should also be a standard feature as it enables handling better than normal tube tires. v. Companies should come up non skidding tires especially for the monsoon where majority of the accidents occur due to poor tires and especially with a person travelling on a two wheeler. vi. Free helmets should be given while purchasing a new bike which enables safety of the rider. vii.Also better head lights like the xenon should be given as an additional option to the buyer which enables better vision during the night times. viii.Hero Honda lags a bike in the 180cc – 200cc segment. The company should come up with a bike in this segment which will increase its market share more as there are new bikes coming from TVS n Bajaj in this segment. ix. As Yamaha bikes are knows purely from performance point of view, company should soon come with biker capacity bikes in the 200cc and above segment as Bajaj and Hero Honda is only available in this segment. This will increase the competition in this segment and the buyers will have a wider range of bikes to choose from. x. Last but not the least bikes should be priced at a competitive range which will enable buyers from all class to choose wisely from.

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WEB LIOGRAPHY: www.fadaweb.com www.automobileindia.com www.managementparadise.com www.vicky.in www.bikeadvice.in www.bikeindia.com www.auto.indiamart.com www.autos.maxabout.com www.herohonda.com www.honda2wheelersindia.com www.bajajauto.com www.tvsmotor.in www.yamaha-motor-india.com

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ANNEXURE Annexure – I (copy of questionnaire)

Questionnaire Topic: Study on Two Wheeler Industry in Mumbai Subject: Research Methods in Business

1. Age: _______ 2. Sex: __________ 3. Do you own a bike? 

Yes

No



1. Which brand of bike do you own? Hero Honda Yamaha Bajaj Suzuki

Honda





Tvs Royal Enfield Others













2. Which class of bike do you own? 100cc – 135cc 180cc – 200cc

150cc – 160cc 200cc and above









3. Would you prefer performance over mileage (average)? Yes

No





4. At what price range would you buy a bike? Below Rs. 50,000 Rs.75,000 – 90,000

 

Rs. 50,000 – 75,000 Rs. 90,000 and more 



5. Towards which brand are you loyal to? Hero Honda Yamaha Bajaj

Honda





Tvs Royal Enfield









80

Study on Two Wheeler Automobile Industry in Mumbai Suzuki



6. Are you satisfied with the after sales services provided by your bike manufacturer? Yes

No





7. What do you look for in a bike? Performance Mileage Styling Technology Pricing All of the above Others _____________________________________________________________________ 













8. If the bike of your choice and brand is not available in the market i.e, it has a waiting period will u still buy that bike? Yes





No

9. Do you think bikes should come up with safety features such as ABS brakes as a standard option? Yes No Any other safety feature: _____________________________________________________________________ _____________________________________________________________________ 



Comments:

Suggestions/ Complaints:

81


Annexure – II (Pictures)

82


List

of Tables

Title 1.1 Balance sheet Hero Honda motors 1.2 Profit and loss a/c Hero Honda motors 1.3 Board of directors 1.4 Balance sheet Bajaj auto 1.5 Profit and loss a/c Bajaj auto 1.6 Board of directors Bajaj auto 1.7 About Honda 1.8 Hondas organization structure 1.9 Yamaha’s organization chart 1.10 Corporate Profile 1.11 Balance sheet Yamaha motors 1.12 Net Assets 1.13 Target audience 1.14 Gender wise bifurcation 1.15 Total population 1.16 Bike owned 1.17 Brand of bike 1.18 Class of bike 1.19 Performance over mileage 1.20 Price range 1.21 Brand loyalty 1.22 Satisfactory after sales service 1.23 Looks in a bike 1.24 Will you wait 1.25 Safety features

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3. Two Wheel Automobile Industry

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