A PROJECT REPORT ON

MARKETING STRATEGY OF MARUTI UDYOG LTD.

SUBMITTED TO

Guru Ramdas Ins ! u " #$ Mana%"m"n & T"'(n#)#%* +GRD IMT, In partial fulfilment of Master in Business Management +MBA)

UTTARAK-AND TEC-NICAL UNI.ERSTIY/ DE-RADUN +UK,

Su0m! "d 0*1 S-UB-ENDU PANDEY R#)) n#123435655574 Ba '(127553288

Su0m! "d #1 Mr. S-AILENDRA PUNDIR S"n!#r L"' ur"r GRD2IMT

MARKETING STRATEGY OF MARUTI UDYOG LTD

Declaration

I hereby declare that the work which is being presented in the project entitled MARKETING STRATEGY OF MARUTI in partial fulfillment of re uirement of the award for degree of MASTER OF BUSINESS ADMINISTRATION is an original work carried out by s(u0("ndu 9and"* under !uper"ision of Mr. An:! G#") +Ass!s an sa)"s mana%"r.,

Da "d1 +S(u0("ndu Pand"*, MBA +Y"ar,

T(!s !s # '"r !$* (a (" a0#;" s a "m"n mad" 0* (" 'and!da " !s '#rr"' # (" 0"s #$ m* :n#<)"d%".

Pr#="' Gu!d" Mr. S(a!)"ndra Pund!r

ACKNO>LEDGEMENT

I would like to place on the record the tremendous help that I ha"e recei"ed from persons who contributed towards gi"ing this report its present form#

I wish to e$press my deep gratitude to Mr. An:! G#") for acting as a guide and pro"iding me with continuous support and guidance# %his report could not ha"e fruition without the inputs and the words of ad"ice from him for which we shall always remain grateful to him#

I am also thankful to all the faculty members for their cooperation and guidance#

+S(u0("ndu Pand"*,

INTERNAL GUIDE CERTIFICATE

I ha"e the pleasure in certifying that Mr. S(u0("ndu 9and"*& is a bonafide student of 'rd !emester of the Mas "r?s D"%r"" !n Bus!n"ss Adm!n!s ra !#n #$ GRD2IMT & Dehradun under (ni"ersity )oll *o# +,+-.---/, 0e has completed her project work entitled MARKETING STRATEGY OF

MARUTI UDYOG LTD. under my guidance#

I certify that this is his original effort 1 has not been copied from any other source# %his project has not been submitted in any other uni"ersity for the purpose of award of any Degree# %his project fulfils the re uirement of the curriculum prescribed by U ara:(and T"'(n!'a) Un!;"rs! */ Dehradun& for the said course# I recommend this project for e"aluation 1 consideration for the award of degree to the student#

S!%na ur"1

Nam" #$ (" Gu!d"1

Da "1

Pr"$a'"
)esearch work constitutes the back bone of any management education program# A management graduate has to do the research uite fre uently during the entire life span# %he idea this research has concei"ed as a part of the summer training program after two semester of full time MBA course at GRD IMT/ DE-RADUN. %his work %o study what are strategies adopted by MA)(%I has been done to check the effecti"eness are these strategies and know what is effecti"e promotion strategy of MA)(%I and find out the e$porting planning for Maruti 2ars# I will be e$tremely satisfied if the effort is appreciated#

CONTENTS

2hapter

%itle

3age *o#

%itle Acknowledgement 3reface

i) ii) iii)

4# 2ompany profile /# Mission and "ision '# 3roduct 3rofile of Maruti ,# 9bjicti"e of the company .# )esearch Methodology 8# 9bjecti"e of the study 5# Data Interpretation :# ;imitations +# 2onclusion 4-# Bibliography

5 6 44 4/ 4'748 4574: 4+ //478. 88 8578: 8+

Company Profile
Maruti Udyog Limited (MUL) was established in Feb 1981 through an Act of Parliament to meet the growing demand of a !ersonal mode of trans!ort caused by the lac" of an efficient !ublic trans!ort system# $t was established with the ob%ecti&es of ' moderni(ing the $ndian automobile industry !roducing fuel efficient &ehicles to conser&e scarce resources and !roducing indigenous utility cars for the growing needs of the $ndian !o!ulation# A license and a )oint *enture agreement were signed with the +u(u"i Motor ,om!any of )a!an in -ct 198. by which +u(u"i ac/uired 012 of the e/uity and agreed to !ro&ide the latest technology as well as )a!anese management !ractices# +u(u"i was !referred for the %oint &enture because of its trac" record in manufacturing and selling small cars all o&er the world# 3here was an o!tion in the agreement to raise +u(u"i4s e/uity to 562 which it e7ercised in 1988#Fi&e years later in 19909 +u(u"i further increased its e/uity to :62 turning Maruti into a non'go&ernment organi(ation managed on the lines of )a!anese management !ractices# Maruti created history by going into !roduction in a record 1. months# Maruti is the highest &olume car manufacturer in Asia outside )a!an and ;orea ha&ing !roduced o&er : million &ehicles by May 066:# Maruti is one of the most successful automobile %oint &entures and has made !rofits e&ery year since ince!tion till 0666'61# $n 0666'61 although Maruti generated o!erating !rofits on an income of <s 90#: billion high de!reciation on new model launches resulted in a boo" loss#

3he =&olution
Maruti<s history of e"olution can be e$amined in four phases= %wo phases during pre7liberali>ation period ?4+:'7:8& 4+:874++/) And two phases during post7liberali>ation period ?4++/7+5& 4++57 /--/)& followed by the full pri"ati>ation of Maruti in @une /--' with %he launch of an initial public offering ?I39)#%he first phase started when Maruti rolled out its first car in December 4+:'# During the initial years Maruti had ::' employees& a capital of )s# 8-5 mn and profit of )s# 45 mn without any ta$ obligation# Arom such a modest start the company in just about a decade ?beginning of second phase in 4++/) had turned itself into an automobile giant capturing about :-B of the market share in India# Cmployees grew to /--- ?end of first phase 4+:8)& '+-- ?end of second phase 4++/) and .5-- in 4+++# %he profit after ta$ increased Arom )s 4:#85 mn in 4+:, to )s# 8:.,#., mn in 4++: but started declining during 4++57 /--4# During the pre7liberali>ation period ?4+:'74++/) a major source of Maruti<s strength was the wholehearted willingness of the Do"ernment of India to subscribe to !u>uki<s technology and the principles and practices of @apanese management# ;arge number of Indian managers& super"isors and workers were regularly sent to the !u>uki plants in @apan for training# Batches of @apanese personnel came o"er to

Maruti to train& super"ise and manage# Maruti<s style of management was essentially to follow @apanese management practices# %he 3ath to !uccess for Maruti was as follows= ?a) %eamwork and recognition that each employee<s future growth and prosperity is totally dependent on the company<s growth and prosperity ?b) !trict work discipline for indi"iduals and the organi>ation ?c) 2onstant efforts to increase the producti"ity of labour and capital ?d) !teady impro"ements in uality and reduction in costs ?e) 2ustomer orientation ?f) ;ong7term objecti"es and policies with the confidence to reali>e the goals ?g) )espect of law& ethics and human beings# %he path to success translated into 3ractices that Maruti<s culture appro$imated from the @apanese management 3ractices#

India Four Wheeler Industry

3he Four'>heeler $ndustry in $ndia has not /uite matched u! to the !erformance of its counter!arts in other !arts of the world# 3he !rimary reason for this has been the all'!er&asi&e regulatory atmos!here !re&ailing till the o!ening u! of the industry in the mid'1996s# 3he &arious layers of legislati&e Acts sheltered the industry from e7ternal com!etition for a long time# Moreo&er the industry was considered low'!riority as cars were thought of as unaffordable lu7ury?# Post Liberali(ation the car mar"et in $ndia ha&e been in a burgeoning stage with all ty!es of cars flooding the mar"et in order to meet the demands of $ndian customers who are increasingly e7!osed to state of the world automobiles and want the best when it comes to !urchasing a car# $t is e7!ected that by 06.6 the $ndian car mar"et will be the .rd largest car mar"et across the globe# 3he main encouraging factors for the success story of the car mar"et in $ndia are the increase in the o!!ortunity for new in&estments the rise in the @AP rate the growing !er ca!ita income massi&e !o!ulation and high ownershi! ca!acity# 3he liberali(ation !olicies followed by the $ndian go&ernment had been in&iting foreign !layers to !artici!ate in the car mar"et in $ndia# 3he recent trend within the new generation to get wor" in the software based sector has led to the rise in the income le&el and change in the lifestyle

significantly which has further led to the increase in the demand for lu7urious cars among them# 3he car Mar"et in $ndia is crowded with all &arieties of car models li"e the small cars mid'si(e cars lu7ury cars su!er lu7ury cars and s!orts utility &ehicles# $nitially the most !o!ular car model dominating the ,ar Mar"et in $ndia was the Ambassador which howe&er today ga&e way to numerous new models li"e Byundai Bonda Mercedes'Cen( CM> Centley and many others# Moreo&er there are many other models of cars in the !i!eline to be launched in the car mar"et in $ndia# +ome of the leading brands dominating the car mar"et in $ndia at !resent are Bindustan Motors <e&a =lectric ,ar ,o# Fiat $ndia Pri&ate Ltd# Aaimler ,hrysler $ndia Pri&ate Ltd Ford $ndia Ltd# and Bonda +iel ,ars $ndia Ltd# @eneral Motors $ndia Byundai Motors $ndia Ltd# +"oda Auto $ndia Pri&ate Ltd# and 3oyota ;irlos"ar Motor Ltd# +ince the demand for foreign cars are increasing with time big brands li"e Mercedes Cen( *ol"swagen Aston Martin Ferrari and <olls'<oyce ha&e long since made a foray into the $ndian car mar"et#

Facts about Indian Car Market

Although the $ndian automobile industry has come a long way since the deregulation in 199.

$ndia does not ran" well &i(# the

among its global !eers in many res!ects cars !er !erson

contribution of the sector to industrial out!ut number of em!loyment by the sector as a

!ercentage of industrial em!loyment number of monthsD income re/uired to !urchase a car and !enetration of cars#

Figure:-Passenger &ehicle stoc" !er 166 !eo!le $ndia is

far behind from other countries with %ust 1#9 cars !er 166 !ersons while Unites +tates has 81#9 cars on !er 166 !ersons# Among de&elo!ing countries <ussia also stands ahead than $ndia and ,hina with 11#. cars !er 166 !ersons# 3wo things that stunted growth of the $ndian automobile industry in the !ast ha&e been low demand and lac" of &ision on the !art of the original e/ui!ment manufacturers (-=Ms)# Bowe&er the demand has !ic"ed u! after the liberali(ation of the regulatory en&ironment

and global -=Ms who en%oy scale economies both in terms of manufacturing and research and de&elo!ment (<EA) entered the $ndian mar"et# 3his has resulted in a significant shift in the way business is conducted by su!!liers assemblers and mar"eters#

Vision
3he leader in the $ndia Automobile $ndustry ,reating ,ustomer Aelight and +hareholder4s >ealth9 A !ride of $ndiaF

Mission
3o !ro&ide ma7imum &alue for money to their customers through continuous im!ro&ement of !roducts and ser&ices# Maruti has a

networ" of .91 sales outlets across 0.6 cities all o&er $ndia# 3he ser&ice networ" co&ers 1 11. towns and cities bolstered by 0 150 authori(ed ser&ice outlets# 3he com!anyDs change in strategy and em!hasis on de&elo!ing effecti&e mar"eting communications was their highlights#

Product Profile of Maruti

MA !"I #$$ - C%A&'( )*!

+IF(

$t has gone beyond being %ust a car9 it has actually changed the lifestyles of countless !eo!le by bringing the %oy of motoring to millions across the length and the breadth of the country# +tanding testimony to this claim is the fact that more than 0 millions Maruti 866s ha&e been sold till date# 3oday $ndia best selling continues to be the final word on &alue and economy at the entry'le&el segment#

A+"* - +(",- '*

3he alto is a great combination of economy !racticality and styling# A runaway success on the roads of =uro!e it e7em!lifies the benchmar" in build /uality and reliability in a com!act car# 3his is testified by the 05 hour endurance record set on August . 066. of co&ering .680 "ms in 05 hours at an a&erage s!eed of 108 "m!h#

WA'*&

-I&-PI I(. (&'I&(( I&'

3he >agon <4+ original tall body design s!aciousness ergonomically designed interior and fle7ible seating all set it a!art from other cars# $t com!lements the buyers uni/ue !ersonality enables him to li&e a multi' dimensional life by the sheer e7cellence of its engineering and its &ersatility# /(& 0-! (&.( "* "%( &(W /(&

$f you are loo"ing for a car with dro! G dad loo"s and unmatched !erformances then you need loo" beyond the Hen# >ith its new contem!orary and aggressi&e loo" the Hen !reser&es its core &alues of dri&er a!!eal unmatched reliability and economy#166666 satisfied customers in $ndia and around the world bear testimony to this fact#

*M&I 0 FI"- A++ 3he -mni is truly $ndia4s -riginal Multi!ur!ose *ehicle# 3oday it is a&ailable in si7 a&atars G : seater 8 seater cargo ambulance ,I@ and LP@# $t meets di&erse needs across different user segments and can double u! both as a !eo!le carrier and a goods carrier# 3his faithful wor"house is easy on the !oc"et yet tough on the %ob#

V( -A - "%( 1*) *F " AV(++I&' "*'("%( =/ui!!ed with twin A, large sliding doors and fle7ible seating the *ersa encourages families and friends to en%oy long dri&es and gateways together# $n s!ite of being so s!acious its design allows for easy manoeu&rability in the city#

(-"((M 0 P( F* MA&C(2 3!A+I") A&. F!(+ (FFICI(&C) Undoubtedly one of $ndia4s fa&ourite entry G le&el J,F class &ehicles the esteem is the !erfect combination of !ower comfort and economy# $t4s also the !referred choice of rally dri&ers across the country for its !erformance and reliability# 3he =steem offers the o!tion of an 8: bh! !etrol engine for those who desire !ower and a :8 bh! diesel for those who &alue economy# Iot sur!risingly it to!s its class in /uality sur&eys#

-WIF"- )*! A ( "%( F!(+ 3he hot loo"s se7y interiors the automatic climate control the air bags the !ower steering moreo&er all so affordable# 3he wait is o&er# +wift has entered MULs !ortfolio# >hat are you waiting forK

A--"A --"*P 4 &*"%I&' Powered by state of art 998 cc engine it4s the best fuel efficient car in its category with mileage coming around 06"m !er litre#

-5-6 0 M(& A ( 7AC8 <e&olutionary =uro!ean design world class Jdri&e by wireF #Most s!acious in its class +teering mounted audio controls9 with ma7imum ground clearance high on safety with dual airbags#

-WI" ./I (- "%( %(A " CA A car ha&ing e&erything you desire stunning loo"s lu7urious interiors enough !ower to ca!ture your heart# )ust slide in desire and ta"e it for a s!in# $ts sure steals many of hearts including yours#

it9 - :+i;e the Moment< Model of 0669 "nown by the name +u(u"i Js!lashF ha&ing attracti&e bac" with ma7imum ground clearance#

*71(C"IV( *F "%( C*MPA&)

Maruti4s mar"eting ob%ecti&e is to continually offer the customer new !roducts and ser&ices thatL <educe the customers cost of ownershi! of their cars9 and antici!ate and address the ,ustomer4s needs and !references in all as!ects and stages of car ownershi! to !ro&ide what they refer to as theJ.16 degree customer e7!erience#F3hey sell ten models with more than :6 &ariants in segments A C , and utility &ehicle segment of the $ndian !assenger car mar"et# -f these they manufacture nine models and im!ort the @rand *itara as a com!letely built unit from +u(u"i in )a!an# 3heir models and &ariants are designed to address the changing demands of the mar"et and are !eriodically u!graded in technology styling and features# 3o ta"e ad&antage of the brand recognition associated with their !roducts they retain the brand name of the !roduct through &arious stages of !roduct u!grades o&er time# For e7am!le the &ersion of the Maruti 866 brand currently sold in the mar"et is a significantly u!graded &ersion in terms of

technology design and styling of the Maruti 866 launched in 198.#

' A.( CA
A#Maruti 866 A# -MI$ C# Hen C# >agon < C# Alto ,# =steem ,# Caleno ,# *ersa

,# +>$F3 Utility *ehicle @MP+M ;$I@ Utility *ehicle @<AIA *$3A<A

R"s"ar'( M" (#d#)#%*

R"s"ar'( is common parlance refers to a search for knowledge research is a scientific in"estigation# )esearch is a mo"ement from known to unknown#

According to learner<s dictionary of current Cnglish& research is A careful in"estigation or in uiry especially through search for new fact in any branch of knowledge

According to )edman and Mory& research is !ystematic effort to gain new knowledge<

)esearch is an academic acti"ity and as such& the term should be used in a technical sense# It comprises defining and as such& the term should be used in a technical sense# It comprises defining and redefining problems& formulating hypothesis or suggested solution= collecting& organi>ing and e"aluating data making deduction and conclusion to determine whether they fit the formulating hypothesis#

)esearch Methodology may be defined as a way to systematically sol"e the research problem# )esearch mythology constitutes of research method& used in conte$t of research study and e$planation of using a particular method or techni ue and way other techni ues are not used#

It also includes the reason for taking up a particular problem& the data collection & its analysis and interpretation#

Aor this particular the steps of research methodology are as gi"en below= 4# !tate of problem /# C$tensi"e literature sur"ey '# Designing of study followed or the methodology ,# Data collection .# Analysis of data 8# 2onclusion and interpretation of research

O0="' !;" #$ (" s ud*

%he major objecti"es of my study are as follows=

4# Aind out the marketing strategies of MA)(%I (DE9D ;td# /# %o check out the Marketing mi$ strategies of MA)(%I# 3roduct strategies# 3lace strategies# 3rice strategies# 3romotion strategies#

'# C$porting strategies# ,# Aind out the B2D matri$ for maruti udyog ltd# .# Aind out the key success factor of maruti udyog and o"erall business strategies of MA)(%I (DE9D ;td

.A"A I&"( P ("A"I*&

6Ps:Product Price Place

Promotion

Product -trategy: Portfolio of 10 !roducts Fi&e !roduct lines

Product Line Products A1' 866 A0' Alto Hen >agon G< +wift A'star A. 'Ae(ire +75 +U* *itara @y!sy , ' ,lass -mni *ersa

Price -trategy:3he !rice of the Maruti car is between <s# 016666 to <s# 1:66666# Maruti G 866 is the lowest !rice car of this com!any# Alto -mni >agon < are also the low !rice car of the com!any Hen E =steem are the mid !rice car of the com!any# Cut @rand *itara is the high !rice model of the com!any# 3he !rice of car is decided according to its !roduct &ariety /uality design etc#

Place strategy:166 Iew car sales outlets co&ering .9. cities# 01: JMaruti 3rue *alueF outlets s!read across 111 cities#0108 Maruti Authori(ed +er&ice +tations co&ering 1006 cities# 3ie u! with Adani grou! for e7!orting 066 666 units through Mnudra !ort @u%arat

-uggested Place strategy:566 new car sales outlets in ne7t three years# +1:6 new true &alue sho!s in ne7t three years# 1066 new Maruti Authori(ed +er&ice +tations in ne7t three years# 3ie u! with other distributors for =7!orts#

Promotion -trategy: Ad&ertising 3* Ads Print Ads <adio Ads J@har AA @aya BindustanF J$ndia ,omes Bome in Maruti +u(u"i#F

$nformation Ad&ertising alternati&e Ad&ertising -!tions C3L ' +!onsorshi!s 3* shows ' $ndia4s @ot talent

Place Ad&ertising G Cill boards +ales Promotions

 Product warranties Premiums (gifts) 3rade shows # 0 1083he number of wor"sho!s that !ro&ide customers with maintenance su!!ort in 1006 cities#

-W*" Analysis:-

-" (&'"%Cigger name in the mar"et 3rust of Peo!le Maruti Udyog Ltd# is the mar"et leader for more than a decade#

Bas a great dealershi! chain in the mar"et# Cetter after sales ser&ice Low maintenance cost of &ehicle

W(A8&(--(=7!orts are not that good# Lesser diesel models in the mar"et com!are to others @lobal image is not that big

*PP! "!&I"I(@reat o!!ortunities to go global with success of +wift and +N5 all o&er# $ntroduction of more diesel models# 3he diesel car segment is growing# -!!ortunity to grow bigger by entering into bigger car mar"ets# Already a mar"et leader so great o!!ortunity to be the "ing of mar"et in e&ery stage of industry

"% (A"Foreign com!anies entering mar"et9 so a bigger threat from MI,s# 3o the mar"et share as many big names are coming in the $ndustry# 3here is hardly any diesel models <s# 1 la"h G <s# 1#: la"h car#

Portfolio Analysis

MA" I5 of MA !"I -!/!8I

+3A<L 3he ,om!any has long run o!!ortunity for growth and !rofitability# 3hey ha&e high relati&e mar"et share and high @rowth rate# +>$F3 +>$F3 A=+$<= AIA H=I =+3$L- is the fast growing and has !otentialto gain substantial !rofit in the mar"et# OU=+3$-I MA<;L there are also called as wild cats that are new !roducts with !otential for success but there cash needs are high and cash generation is low# $n auto industry of MA<U3$ +N5 @<AIA *$3A<A A+3A< there has

been im!ro&e the organi(ation re!utation# As they want successful not only in $ndian mar"et but as well as in global mar"et#

,A+B ,->L $t has high relati&e mar"et share but com!ete in low growth rate as they generate cash in e7cess of their needs# MA<U3$ 866 AL3- AIA >A@I-< ha&e fallen to ladder . E 5 due to introduction of H=I =+3AL$- and A +3A<#

A-@L 3he dogs ha&e no mar"et share and do not ha&e !otential to bring in much cash# CAL=I- -M$I$ *=<+A 3here businesses ha&e li/uidated and trim down thus 3he strategies ado!ted are that are har&est di&est and dro!# C,@ matri7 can ser&es as a sim!le tool for &iewing a cor!oration4s business !ortfolio at a glance and may ser&es as a starting !oint for discussing resource allocation among strategic business units#

"%( P *.!C"I*& P *C(-- A" MA !"I

-A7P"W+V-A( A-(I(&(%+-M. "I8-CCII7I*&+&+(I'')+ -

I&-P(C"I*& -"(!-P"P + )! &= .I-PA"C% F *M V(&.* -

-trategy
3heir strategy is to ca!ture the rural mar"et by em!loying women who belong to their local community through which their !roduct can reach to local

consumers# 3heir strategy is to !ro&ide wor" for women to create awareness among confined consumers#

Process
3hey started with Pro%ect +ha"ti in which their basic aim is to educate a rural !erson about their !roducts through women who belongs to their own local community and who can communicate well in their language with them# $n this way many educated women get wor" in rural sector and on the other hand BLL ,or!orate +ocial <es!onsibility (,+<) also increases towards society by introducing educati&e !rograms for the benefit of the rural sector#

8() -" A"('IC I&I"IA"IV(- 7) MA !"I

A> "! & A *!&. -" A"('I(- MA !"I F*++*W(. Maruti was the undis!uted leader in the automobile utility'car segment sector controlling about 852 of the mar"et till 1998# >ith increasing com!etition from local !layers li"e 3elco Bindustan Motors Mahindra E Mahindra and foreign !layers li"e Aaewoo PAL 3oyota Ford Mitsubishi @M the whole auto industry structure in $ndia has changed in the last se&en years and resulted in the declining !rofits and mar"et share for Maruti# At the same time the $ndian go&ernment !ermitted foreign car !roducers to in&est in the automobile sector and hold ma%ority sta"es# $n the wa"e of its diminishing !rofits and loss of mar"et share Maruti initiated strategic res!onses to co!e with

$ndia4s liberali(ation !rocess and began to redesign itself to face com!etition in the $ndian mar"et# ,onsultancy firms such as A3 ;earney E Mc;insey together with an internationally re!uted -A consultant Ar# Athreya ha&e been consulted on modes of strategy and organi(ation de&elo!ment during the redesign !rocess# 3he redesign !rocess saw Maruti com!lete a <s# 5666 mn e7!ansion !ro%ect which increased the total !roduction ca!acity to o&er . 86 666 &ehicles !er annum# Maruti e7ecuted a !lan to launch new models for different segments of the mar"et# $n its redesign !lan Maruti launches a new model e&ery year reduce !roduction costs by achie&ing 8:'962 indigeni(ation for new models re&am! mar"eting by increasing the dealer networ" from 1:6 to .66 and focus on bul" institutional sales bring down number of &endors and introduce com!etiti&e bidding# 3ogether with the redesign !lan there has been a shift in business focus of Maruti# >hen Maruti commanded the largest mar"et share business focus was to Jsell what we !roduceF# 3he earlier focus of the whole organi(ation was ?!roduction !roduction and !roduction? but now the focus has shifted to ?mar"eting and customer focus?# 3his can be obser&ed

from the changes in mission statement of the organi(ationL 1985L ?Fuel efficient &ehicle with latest technology?# 1988L ?Leader in domestic mar"et and be among global !layers in the o&erseas mar"et?# 1998L ?,reating customer delight and shareholders wealth?# Focus on customer care has become a "ey element for Maruti# $ncreasing Maruti ser&ice stations with the sco!e of one Maruti ser&ice station e&ery 0: "m on a highway# 3o increase its mar"et share Maruti launched new car models concentrated on mar"eting and institutional sales# $nstitutional sales which currently contributes to 8' 82 of Maruti4s total sales# ,ost reduction and increasing o!erating efficiency were another redesign &ariable# ,ost reduction is being achie&ed by reaching an indigeni(ation le&el of 8:'96 !ercent for all the models# 3his would sa&e foreign currency and also stabili(e !rices that fluctuate with e7change rates# Bowe&er change in the mindset was not as fast as re/uired by the mar"et# Maruti !lanned to reduce costs increase !roducti&ity /uality and u!grade its technology (=uro $E$$ MPF$)# $n addition it

followed a high &olume !roduction of about 566 666 &ehicles Pyear which entailed a smooth relationshi! between the wor"ers and the managers# Post1999 the mar"et structure changed drastically# )ust before this change Maruti had wasted two crucial years (1991'1998) due to go&ernmental inter&entions and negotiation with +u(u"i of )a!an about the brea"'u! of the share holding !attern of the com!any# 3here was a change in leadershi! Mr# +ato of +u(u"i became the ,hairman in )une 1998 and the new Mr# )# ;hatter was a!!ointed as the new )oint MA# ;hatter was a belie&er in consensus decision ma"ing and !artici!ati&e style of management# As a result of the internal turmoil and the changes in the e7ternal en&ironment Maruti faced a de!leting mar"et share reducing !rofits and increase in in&entory le&els which it had not faced in the last 18 years# After their fall in mar"et share they redesigned their strategies and through their !arent com!any +u(u"i they learned a lot# 3he organi(ational learning of Maruti was moderately successful9 the cost was relati&ely ine7!ensi&e as Maruti had its strong )a!anese !ractices to fall bac" u!on# >ith the !rogram of organi(ational redesign rationali(ation of cost and enhanced !roducti&ity Maruti bounced bac" to

com!etition with :6#82 mar"et share and 562 rise in !rofit for the FM0660'066.#

7> C!

(&" -" A"('I(- F*++*W(. 7) M!+

P<$,$I@ +3<A3=@M ' ,A3=<$I@ 3- ALL +=@M=I3+ Maruti caters to all segments and has a !roduct offering at all !rice !oints# $t has a car !riced at <s#1 88 666#66 which is the lowest offer on road# Maruti gets 862 business from re!eat buyers who earlier had owned a Maruti car# 3heir !ricing strategy is to !ro&ide an o!tion to e&ery customer loo"ing for u! gradation in his car# 3heir sole moti&e of ha&ing so many !roduct offering is to be in the consideration set of e&ery !assenger car customer in $ndia# Bere is how e&ery !rice !oint is co&ered#
-l?&o? 7 A&. VA IA&"- P IC( I& .(+%I @ s?> 1 ' A&. VI"A A NL8 11 98 666#66 0 MA !"I 7A+(&* LNi : 80 666#66 *Ni 1 50 666#66 . MA !"I (-"((M LN 5 11 666#66

*N : .9 666#66 5 MA !"I V( -A AN 5 19 666#66 AN0 5 :8 666#66 : MA !"I -WIF" LNi . 9: 666#66 *Ni 5 6: 666#66 HNi 5 8: 666#66 1 MA !"I WA'*&LNi . 10 666#66 AN 5 1. 666#66 *Ni . 88 666#66 *Ni AC+ 5 06 666#66 8 MA !"I ')P-) +3 : 61 666#66 B3 : 09 666#66 8 MA !"I /(& A . :8 666#66 LN . 51 666#66 LNi . 18 666#66 *Ni . 9. 666#66 9 MA !"I *M&I ,A<@- 0 6: 666#66 ,A<@- LP@ 1 8. 666#66 : +=A3=< 0 08 666#66 8 +=A3=< 0 01 666#66 NL : +=A3=< 0 19 666#66 NL 8 +=A3=< 0 .1 666#66 16 MA !"I A+"* +3AIAA<A 0 .8 666#66 LN . .: 666#66

LN 0 85 666#66 LNi 0 95 666#66 11 MA !"I #$$ +3A# MPF$ 0 15 666#66 AP, MPF$ 0 .8 666#66

$$# -FF=<$I@ -I= +3-P +B-P 3- ,U+3-M=<+ -< ,<=A3$I@ A$FF=<=I3 <=*=IU= +3<=AM+ Maruti has successfully de&elo!ed different re&enue streams without ma"ing huge in&estments in the form of MA+ I0I Maruti $nsurance and Maruti Finance# 3hese hel! them in ma"ing the customer e7!erience hassle free and hel!s building customer satisfaction# Maruti FinanceL $n a mar"et where more than 862 of cars are financed Maruti has strategically entered into this and has successfully created a re&enue stream for Maruti# 3his has been found to be a ma%or dri&er in con&erting a Maruti car sale in certain cases# Finance is one of the ma%or decision dri&ers in car !urchase# Maruti has tied u! with 8 finance com!anies to form a consortium# 3his consortium com!rises ,iticor! Maruti Maruti ,ountrywide $,$,$ Can" BAF, Can" ;ota" Mahindra

+undaram Finance Can" of Pun%ab and $ndus$nd Can" Ltd# ( erstwhile'Asho" Leyland Finance)# Maruti $nsuranceL $nsurance being a ma%or concern of car owners# Maruti has brought all car insurance needs under one roof# Maruti has tied u! with Iational $nsurance ,om!any Ca%a% Allian( Iew $ndia Assurance and <oyal +undaram to bring this ser&ice for its customers# From identifying the most suitable car co&erage to &irtually hassle'free claim assistance itDs your dealer who ta"es care of e&erything# Maruti $nsurance is a hassle'free way for customers to ha&e their cars re!aired and claims !rocessed at any Maruti dealer wor"sho! in $ndia# 3rue *alue G $nitiati&e to ca!ture used car mar"et Another significant de&elo!ment is MULDs entry into the used car mar"et in 0661 allowing customers to bring their &ehicle to a DMaruti 3rue *alueD outlet and e7change it for a new car by !aying the difference# 3hey are offered loyalty discounts in return# 3his hel!s them retain the customer# >ith Maruti 3rue *alue customer has a trusted name to entrust in a highly unorgani(ed mar"et

and where cheating is ram!ant and the biggest concern in biggest dri&er of sale is trust# Maruti "nows its strength in $ndian mar"et and has filled this ga! of !ro&iding trust in $ndian used car mar"et# Maruti has created a system where dealers !ic" u! used cars recondition them gi&e them a fresh warranty and sell them again# All in&estments for 3rue *alue are made by dealers# Maruti has build u! a strong networ" of 180 showrooms across the nation# 3he used car mar"et has a huge !otential in $ndia# 3he used car mar"et in de&elo!ed mar"ets was 0'. times as large as the new car mar"et# I0IL ,ar maintenance is a time'consuming !rocess es!ecially if you own a fleet# Maruti4s I0I Fleet Management +olutions for com!anies ta"es care of the A'H of automobile !roblems# +er&ices include end'to'end bac"u!sPsolutions across the &ehicle4s lifeL Leasing Maintenance ,on&enience ser&ices and <emar"eting# Maruti Ari&ing +chool (MA+)L Maruti has established this with the goal to ca!ture the mar"et where there is inhibition in buying cars due to inability to dri&e the car#

3his brings that customer to Maruti showroom and Maruti ends u! creating a customer# $$$# <=P-+$3$-I$I@ -F MA<U3$ P<-AU,3+ >hene&er a brand has grown old or its sales start di!!ing Maruti ma"es some facelifts in the models# -ther changes ha&e been made from time to time based on mar"et res!onses or consumer feedbac"s or the com!etitor mo&es# Bere are the certain changes obser&ed in different models of Maruti# -mni has been gi&en a ma%or facelift in terms of interiors and e7teriors two months bac"# A new &ariant called -mni ,argo which has been !ositioned as a &ehicle for trans!orting cargo and meant for small traders# $t has recei&ed a &ery good res!onse from mar"et# A &ariant with LP@ is recei&ing a &ery good res!onse from customers who loo" for low cost of running# *ersa !rices ha&e been slashed and right now the lowest &ariant starts at .#. lacs# 3hey decreased the engine !ower from 1166cc to 1.66cc and modified it again considering consumers !erce!tion# 3his was a result of intensi&e sur&ey done all across the nation regarding the consumer !erce!tion of *ersa#

=steem has gone through three facelifts# A new loo" last year has hel!ed boost u! the waning sales of =steem# Caleno was launched in 1999 at 8#0 lacs# $n 0660 they slashed !rices to 1#5 lacs# $n 066. they launched a lower &ariant as Caleno LNi at :#51 lacs# 3his was to reduce the !rice and attract customers# >agon'< was !ercei&ed as dull bo7y car when it was launched# 3his made it a big failure on launch# 3hen further modifications in engine to increase !erformance and a facelift in the form of s!orty loo"ing grills on the roof# Iow it4s of the most successful models in Maruti stable# Hen has been modified four times till date# 3hey had come u! with a limited !eriod &ariant called Hen ,lassic# 3hat was limited !eriod offer to boost short term sales# Maruti 866 has so far been face lifted two times# -nce it came with MPFi technology and other time it came u! with changes in front grill head light rear lights and with round cur&es all around# $*# ,U+3-M=< ,=I3<$, APP<-A,B Maruti4s customer centricity is &ery much e7em!lified by the fi&e times consecuti&e wins at ) A Power ,+$ Awards#

Focus on customer satisfaction is what Maruti li&es with# Maruti has successfully shed off the !ublic' sector laid bac" attitude image and has inculcated the customer' friendly a!!roach in its organi(ation culture# 3he customer centric attitude is imbibed in its em!loyees# Maruti dealers and em!loyees are answerable to e&en a single customer com!lain# 3here are instances of cancellation of dealershi!s based on customer feedbac"# Maruti has ta"en a number of initiati&es to ser&e customer well# 3hey ha&e e&en changed their showroom layout so that customer has to wal" minimum in the showroom and there are norms for ser&ice times and deli&ery of &ehicles# 3he Aealer +ales =7ecuti&e who is the first interaction medium with the Maruti customer when the customer wal"s in Maruti showroom is trained on greeting eti/uettes# Maruti has !ro!er customer com!lain handling cell under the ,<M de!artment# 3he Maruti call center is another effort which brings Maruti closer to its customer# 3heir Mar"et <esearch de!artment remains on its toes to study the changing consumer beha&iour and mar"et needs# Maruti en%oys se&enty !ercent re!eat buyers which further bolsters their claim of being customer friendly# Maruti is in&esting a lot of

money and effort in building customer loyalty !rogrammes# *# ,-MM$33=A 3- M-3-<$H$I@ $IA$A Maruti is committed to motori(ing $ndia# Maruti is right now wor"ing towards ma"ing things sim!le for $ndian consumers to u!grade from two'wheelers to the car# 3owards this end Maruti !artnershi!s with +tate Can" of $ndia and its Associate Can"s too" organi(ed finance to small towns to enable !eo!le to buy Maruti cars# <s# 0:99 scheme was one of the outcomes of this effort# Maruti e7!ects the com!act cars which currently constitute around 862 of the mar"et to be the engine of growth in the future# <obust economic growth fa&ourable regulatory framewor" affordable finance and im!ro&ements in infrastructure fa&our growth of the !assenger &ehicles segment# 3he low !enetration le&els at 8 !er thousand and rising income le&els will augur well for the auto industry# Maruti is busy fine'tuning another inno&ation# >hile researching they found that rural !eo!le had strange notions about a car ' which the =M$ (e/uated monthly instalments) would range between <s 5 666 and <s

: 666# 3hat !lus another <s 1 :66'0 666 for monthly maintenance another <s 1 666 for fuel (would be the cost of using the car)# 3o counter that a!!rehension the com!any is wor"ing on a no&el idea# ,ontrol o&er the fuel bill is in the consumerDs hands# Cut maintenance need not be# +ays ;hattarL ?>hat the com!any is doing now is saying how much you s!end on fuel is in your hands anyway# As far as the maintenance cost is concerned if you want it that way we will charge a little e7tra in the =M$ and offer free maintenance#? *$# A$+$I*=+3M=I3 AIA $P- -F MA<U3$ UAM-@ L$M$3=A $t was a long and tough %ourney but a rewarding one at the end# A reward worth <s0 505 crore ma"ing it the biggest !ri&ati(ation in $ndia till date# 3he si(e of Maruti4s sell' off deal is !roof of its success# -n the in&estment of <s 11 crore it made in 1980 when Maruti Udyog Limited (MUL) was formally set u! the sale re!resents a staggering return of .: times 3he best !art of the deal is the <s 1 666 crore control !remium the @o&ernment has been able to e7tract from +u(u"i Motor ,or!oration for relin/uishing its hold o&er $ndia4s largest car com!any# Iow loo"ing at the strategy !oint of it G for +u(u"i of course com!lete control of MUL means a lot#

Maruti is its most !rofitable and the largest car com!any outside )a!an# +u(u"i will now be in the dri&er4s seat and will not ha&e to mind the whims and fancies of ministers and bureaucrats# JAecisions will now become /uic"er# 3he res!onse to changing mar"et conditions and technological needs will be faster F says )agdish ;hattar managing director MUL# After the disin&estment +u(u"i became the decision ma"er at MUL# 3hey flowed fund in $ndia for the ma%or re&am! in MUL# Ouoting from the re!ort that a!!eared in 3he =conomic 3imes 5th A!ril 066: ' 3he $ndian car giant Maruti Udyog Limited has finali(ed its two mega in&estment !lans Q a new car !lant and an engine and transmission manufacturing !lant# Coth the !ro%ects will be im!lemented by two different com!anies# At its meeting the com!anyDs board a!!ro&ed a total in&estment of <s. 081#9 crore for these two &entures which will be located in Baryana# 3he abo&e signifies when @-$ was a ma%or sta"eholder in the MUL strategies which lead to in&estment ha&e had a bureaucracy factor in it but after the disin&estment

strategy followed is a 3-P A->I a!!roach with a fast im!lementation# +u(u"iDs !ro!osed two'wheeler facility in $ndia would start ma"ing motorcycles and scooters by the end of 066: through a %oint &enture in which Maruti has :1 !er cent sta"e# 3he two'wheeler unit will ha&e a ca!acity of 0:6 666 units a year# 3he disin&estment followed by $P- gi&es the insight in the fact that now all the strategic decisions are ta"en by Maruti +u(u"i ,or!oration# Aisin&estment had hel!ed by remo&ing the red ta!e and bureaucracy factor from its strategic decision ma"ing !rocess# *$$# <=AL$+A3$-I -F $MP-<3AI,= -F *=B$,L= MA$I3=IAI,= +=<*$,=+ MA<;=3 $n the old days the com!anyDs o!erations could be boiled down to a sim!le three'bo7 flowchart# ,om!onents came from the D&endorsD to the DfactoryD where they were assembled and then sent out to the DdealersD# $n this scheme you "now where the com!anyDs re&enues come from# 3he new scheme is more com!licated# $t re&ol&es around the total lifetime &alue of a car#

>or" on this began in 1999 when a MUL team wondering about new re&enue streams tra&elled across the world# +ays <#+# ;alsi general manager (new business) MULL ?>hile car com!anies were mo&ing from !roducts to ser&ices trying to ca!ture more of the total lifetime &alue of a car MUL was %ust ma"ing and selling cars#? $f a buyer s!ends <s 166 on a car during its entire life one'third of that is s!ent on its !urchase# Another third went into fuel# And the final third went into maintenance# =arlier Maruti was getting only the first one'third of the o&erall stream# As the $ndian mar"et matured customers began to change cars faster# +ays ;alsiL ?+o the /uestion was if a car is going to see three users in say a life s!an of 16 years how can $ ma"e sure that it comes bac" to me each time it changes hands K +o Maruti has changed gears to ta"e a big share of this final one'third s!ent on maintenance# Maintenance mar"et has a huge mar"et !otential# =&en after ha&ing fifty la"h &ehicles on road Maruti is only catering to a!!ro7imately 06666 &ehicles through its ser&ice stations e&ery day#

For this they are conducting free ser&ice wor"sho!s to encourage consumers to come to their ser&ice stations# Maruti has increased its authori(ed ser&ice stations to 1:18 across 16.1 cities# =&ery regional office is ha&ing a se!arate ser&ices and maintenance de!artment which loo" after the growth of this re&enue stream# *$$$# PLAM$I@ -I ,-+3 L=AA=<+B$P Maruti is the !rice dictator in $ndian automobile industry# $t4s the low cost !ro&ider of car# 3he lowest car on road is from Maruti stable i#e# Maruti 866# Maruti achie&es this through continuous im!ro&ements in o!erational efficiency and !roducti&ity# 3he com!any has set itself (and its &endors) the target of a :62 im!ro&ement in !roducti&ity and a .62 reduction in costs in three years# 3he ability to "ee! lowering the !rices sets Maruti a!art from other !layers in the league# Maruti s!read the o&erheads o&er a larger base# 3he im!ressi&e sales and !rofits were the result of ma%or efforts within the com!any# Maruti also increased focus on &endor management# Maruti consolidated its &endor base# 3his has !ro&ided its &endors with higher &olumes and higher efficiencies#

Maruti does that by wor"ing with &endors assuring them that for e&ery dro! in !rice &olumes will go u!# Maruti is now encouraging its &endors to de&elo! <EA ca!ability for s!eciali(ed com!onents# Cased u!on such acti&ities !roduct com!etiti&eness in the mar"et will further increase# Maruti also made strides in a!!lying $3 to manufacturing# A new *ehicle 3rac"ing +ystem im!ro&ed efficiency on the sho! floor and enhanced /uality control# 3he e Iagare system ado!ted from +u(u"i Motor ,or!oration smoothened Maruti4s )ust in 3ime o!erations#

,) MA)-< FU3U<= +3<A3=@$=+ $# PBA+$I@ -U3 H=I $I 0668 3he launch of +wift and !hasing out Hen is a strategic mo&e# Alto was launched "ee!ing in mind that it will ta"e o&er Maruti 866 mar"et in future# Perha!s being the flagshi! !roduct !hasing out of Maruti 866 faced lots of resistance from dealers all o&er# Another reason behind not !hasing out Maruti 866 was the fear of brand shift of customers to other com!etitor4s !roduct# +wift was launched in May 066: in the !rice band starting from 5

lacs# Cefore launch of +wift Maruti management had decided that they will !hase out Hen since it had already came u! with two modifications# 3he ma%or reason behind this decision was cannibali(ation of >agon< and +wift due to o&erla!!ing of !rice band# $t is a rational decision to "ill a !roduct before it starts facing the decline stage in !roduct cycle# Maruti is offering <s# .666#66 more margins to dealer on the sale of >agon'< as com!ared to Hen# 3his is to let dealer !ush >agon < instead of Hen# $$# MA<U3$ PLAI+ F-< A C$@ A$=+=L F-<AM 3he new car manufacturing com!any called Maruti +u(u"i Automobiles $ndia Limited will be a %oint &enture between Maruti Udyog and +u(u"i Motor ,or!oration holding a 86 !er cent and .6 !er cent sta"e res!ecti&ely# 3he <s1 :05#0 crore !lant will ha&e a ca!acity to roll out 1 la"h cars !er year with a ca!acity to scale u! to 0#: la"h units !er annum# 3he new car manufacturing !lant will begin commercial !roduction by the end of 0661# Maruti would set u! a diesel engine !lant at @urgaon in line with its !lan to become a ma%or !layer in diesel &ehicles in a cou!le of years# 3his has been done in the wa"e of ma%or com!etition from 3ata $ndica and meets

the growing demand of diesel cars in $ndia# >hile the annual growth in the diesel segment was 1. !er cent in the last three years it was 19'06 !er cent in the first /uarter (A!ril')une) of the current fiscal# Maruti has currently an insignificant !resence in diesel &ehicle# $t will manufacture new generation ,<A$ (common rail direct in%ection) engines in collaboration with Fiat'@M -!el and engines will be of 1066 cc# 3he !lant with a ca!acity to !roduce one la"h diesel engines would be o!erational in 0661# At !resent Peugeot of France su!!lies diesel engines for MarutiDs Hen and mid'si(ed =steem models# 3his will further reduce the im!orted com!onent in Maruti &ehicles ma"ing them more com!etiti&e in the $ndian mar"et# $$$# MA<U3$ PLAI+ F-< A I=> =I@$I= AIA 3<AI+M$++$-I PLAI3 3he engine and the transmission !lant will be owned by +u(u"i Power train $ndia Limited in which +u(u"i Motor ,or!oration would hold :1 !er cent sta"e and Maruti Udyog holding the balance# 3he ultimate total !lant ca!acity would be three la"h diesel engines# Bowe&er

the initial !roduction would be 1 la"h diesel engines 06 666 !etrol engines and 1#5 la"h transmission assemblies# $n&estment in this facility will be <s#1 858#8 crore# 3he commercial !roduction will start by the end of 0661# $*# $IA$A A+ =NP-<3 BUC F-< MA<U3$ 3hree years bac" as an e7!eriment based on the increasing design ca!abilities of su!!liers in countries li"e $ndia Mc;insey did an e7ercise to figure out %ust how much money could be sa&ed if automobiles were to be made in o&erseas locations li"e $ndia Me7ico and +outh Africa '' an automobile CP- so to s!ea"# 3he result was staggeringL the industry stands to gain R 1:6 billion annually in cost sa&ings and an additional R 186 billion annually in new re&enues once demand shoots u! following the dro! in !rices and the combination of which means a 0: !er cent increase in e7isting re&enue le&els# According to the study o&er 96 !er cent of automobiles today are sold in the countries they are made in so thereDs a lot of money to be made by shifting the !roduction o&erseas# 3ill recently %ust 166 666 cars !roduced in low'cost countries were e7!orted to high'cost

ones '' !resumably this figure is going u! now that Altos from Maruti +antro from Byundai $ndicas from 3ata Motors and $"ons from Ford among others are being regularly e7!orted out of $ndia# Met as Mc;insey !oints out since it %ust costs R :66 and %ust three wee"s (and both figures are falling) to shi! out a car to anywhere in the world why !roduce cars in high' wage islandsK $f a car was !roduced in $ndia instead of in )a!an the study says it will cost 00'0. !er cent less after factoring in higher im!ort duties for com!onentsPsteel lower le&els of automation and trans!ort costs# $n August 066. Maruti crossed a milestone of e7!orting .66 666 &ehicles since its first e7!ort in 1981# =uro!e is the largest destination of Maruti4s e7!orts and coincidentally after the first commercial shi!ment of 586 units to Bungary in 1988 the .66 66 mar" was crossed by the shi!ment of :81 units to the same country# 3he to! ten destination of the cumulati&e e7!orts ha&e been Ietherlands $taly @ermany ,hile U#;# Bungary Ie!al @reece France and Poland in that order#

3he Alto which meets the =uro'. norms has been &ery !o!ular in =uro!e where a landmar" 066 666 &ehicle were e7!orted till March 066.# =&en in the highly de&elo!ed and com!etiti&e mar"ets of Ietherlands U; @ermany France and $taly Maruti &ehicles ha&e made a mar"# 3hough the main mar"et for the Maruti &ehicles is =uro!e where it is selling o&er 862 of its e7!orted /uantity it is e7!orting in o&er 86 countries# Maruti has entered some uncon&entional mar"ets li"e Angola Cenin A%ibouti =thio!ia Morocco Uganda ,hile ,osta <ica and =l +al&ador# 3he Middle'=ast region has also o!ened u! and is showing good !otential for growth# +ome mar"ets in this region where Maruti is are +audi Arabia ;uwait Cahrain Oatar and UA=#

3he mar"ets outside of =uro!e that ha&e large /uantities in the current year are Algeria +audi Arabia +rilan"a and Cangladesh# Maruti e7!orted more than :1 666 &ehicles in 066.'65 which was :92 higher than last year#

$n the financial year 066.' 65 Maruti e7!orts contributed to more than 162 of total Maruti sales#

*# MA<U3$ =M=<@$I@ A+ <EA BUC F-< +UHU;$ M-3-< ,-<P-<A3$-I )a!anese auto ma%or +u(u"i is all set to con&ert Maruti Udyog Ltd4s research and de&elo!ment (<EA) facility as its Asia hub by 0668 for the design and de&elo!ment of new com!act cars according to a to! official of the firm# 3he country4s leading car manufacturer will ma"e substantial in&estments to u!grade its research and de&elo!ment centre at @urgaon in Baryana for e7ecuting design and de&elo!ment !ro%ects for +u(u"i# 3his includes localisation modernisation and greater use of com!osite technologies in u!coming models# 3he com!any will be hiring more software engineers and technocrats to handle +u(u"i4s <EA !ro%ects# $n&estment would be more in terms of man!ower than in infrastructure which is already in !lace# A!art from wor"ing on inno&ati&e features the <EA teams will focus on latest technologies using ,AA',AM tools to roll out

new models that will meet the needs of MUL4s di&erse customers in the future#

"he reasons as to Ahy it can be good for =. is that:Firstly the cost in&ol&ed in <EA and infrastructure is low in $ndia as com!ared to other countries# Also the technical s"ills are abundantly a&ailable9 again at a chea!er cost# +econdly $ndia is growing as an e7!ort hub along with the $ndian mar"et growing aggressi&ely into becoming an attracti&e one for in&estors#

3hirdly +u(u"i4s in&estment in $ndia is also im!ortant as it has com!letely di&ested now as a result MUL will now become a 1662 subsidiary of +u(u"i in the coming year#

8() -!CC(-- FAC"* @B>"he 3uality Ad;antage

Maruti +u(u"i owners e7!erience fewer !roblems with their &ehicles than any other car manufacturer in $ndia ()#A# Power $O+ +tudy 0665)# 3he Alto was chosen Io#1 in the !remium com!act car segment and the =steem in the entry le&el mid ' si(e car segment across 9 !arameters#

@C>A 7uying (Dperience +ike &o *ther

Maruti +u(u"i has a sales networ" of .68 state'of 'the'art showrooms across 189 cities with a wor"force of o&er 1666 trained sales !ersonnel to guide MUL customers in finding the right car#

@E>3uality -er;ice Across B$EF Cities

$n the )#A# Power ,+$ +tudy 0665 Maruti +u(u"i scored the highest across all 8 !arametersL least !roblems e7!erienced with &ehicle ser&iced highest ser&ice /uality best in'ser&ice e7!erience best ser&ice deli&ery

best ser&ice ad&isor e7!erience most user'friendly ser&ice and best ser&ice initiation e7!erience# 902 of Maruti +u(u"i owners feel that wor" gets done right the first time during ser&ice# 3he )#A# Power ,+$ study 0665 also re&eals that 982 of Maruti +u(u"i owners would !robably recommend the same ma"e of &ehicle while 962 owners would !robably re!urchase the same ma"e of &ehicle#

@6>*ne -top -hop

At Maruti +u(u"i customers will find all car related needs met under one roof# >hether it is easy finance insurance fleet management ser&ices e7change' Maruti +u(u"i is set to !ro&ide a single'window solution for all car related needs#

@G> "he +oA Cost Maintenance Ad;antage

3he ac/uisition cost is unfortunately not the only cost customers face when buying a car# Although a car may be affordable to buy it may not necessarily be affordable to maintain as some of its regularly used s!are !arts may be !riced /uite stee!ly# Iot so in the case of a Maruti +u(u"i# $t is in the economy segment that the

affordability of s!ares is most com!etiti&e and it is here where Maruti +u(u"i shines#

@F>+oAest Cost of *Anership

3he highest satisfaction ratings with regard to cost of ownershi! among all models are all Maruti +u(u"i &ehiclesL Hen >agon < =steem Maruti 866 Alto and -mni#

@H> "echnological Ad;antage

$t has introduced the su!erior 11 S 5 By!ertech engines across the entire Maruti +u(u"i range# 3his new technology harnesses the !ower of a brainy 11'bit com!uter to a fuel'efficient 5'&al&e engine to create o!timum engine deli&ery# 3his means e&ery Maruti +u(u"i owner gets the ideal combination of !ower and !erformance from his car#

C*MP("I"IV( F* C(- I& I&.IA& PA--(&'( CA MA 8("

,ritical $ssues and Future 3rends 3he critical issue facing the $ndian !assenger car industry is the attainment of brea"e&en &olumes# 3his is related to the /uantum of in&estments made by the !layers in ca!acity creation and

the selling !rice of the car# 3he amount of in&estment in ca!acities by !assenger car manufacturers in turn de!ends on the !roduction
"hreat from the neA players: Increasing

FMost of the major global players are present in the Indian marketG few more are e$pected to enter# FAinancial strength assumes importance as high are re uired for building capacity and maintaining ade uacy of working capital# FAccess to distribution network is important# F;ower tariffs in post H%9 may e$pose Indian companies to threat of imports#
i;alry Aithin the industry: %igh %here is keen competition in select segments# ?compact and mid si>e segments)#

F*ew multinational
Market strength of suppliers: +oA

FA large number of automoti"e components suppliers# FAutomoti"e players are rationali>ing their "endor base to
Market strength of consumers: Increasing

FIncreased awareness among consumers has increased e$pectations# %hus the ability to inno"ate is critical# F3roduct differentiation "ia new features& impro"ed performance and after sales support is critical# FIncreased competiti"e intensity has limited the pricing power of
"hreat from substitutes: +oA to medium

FHith consumer preferences changing& inter product substitution is taking place ?Mini cars are being replaced)

Mar"eting strategies of the car manufacturers# +etting u! integrated manufacturing facilities may re/uire higher ca!ital in&estments than establishing assembly facilities for semi "noc"ed down "its or com!lete "noc"ed down "its# $n recent years e&en though the ratio of sales to ca!acity (an im!ortant indicator of the ability to reach brea"'e&en &olumes) of the domestic car manufacturers ha&e im!ro&ed it is still low for /uite a few car manufacturers in $ndia# $ndia is also li"ely to increasingly ser&e as the sourcing base for global automoti&e com!anies and automoti&e e7!orts are li"ely to gain increasing im!ortance o&er the medium term# Bowe&er the growth rates are li"ely to &ary across segments# Although the Mini segment is e7!ected to sustain &olumes it is li"ely to continue losing mar"et share9 growth in the medium term is e7!ected to be led largely by the ,om!act and Mid'range segments# Additionally in terms of engine ca!acity the $ndian !assenger car mar"et is mo&ing towards cars of higher ca!acity# 3his

a!art com!etition is li"ely to intensify in the +U* segment in $ndia following the launch of new models at com!etiti&e !rices# Maruti +u(u"i is one of $ndiaDs leading automobile manufacturers and the mar"et leader in the car segment both in terms of &olume of &ehicles sold and re&enue earned# Until recently 18#082 of the com!any was owned by the $ndian go&ernment and :5#02 by +u(u"i of )a!an# 3he $ndian go&ernment held an initial !ublic offering of 0:2 of the com!any in )une 066.# As of May 16 0668 @o&t# of $ndia sold its com!lete share to $ndian financial institutions# >ith this @o&t# of $ndia no longer has sta"e in Maruti Udyog# Maruti Udyog Limited (MUL) was established in February 1981 though the actual !roduction commenced in 198. with the Maruti 866 based on the +u(u"i Alto "ei car which at the time was the only modern car a&ailable in $ndia itsD only com!etitors' the Bindustan Ambassador and Premier Padmini were both around 0: years out of date at that !oint# 3hrough 0665 Maruti has !roduced o&er : Million &ehicles# Maruti4s are sold in $ndia and &arious se&eral other countries de!ending u!on e7!ort orders# Models similar to Maruti4s (but not manufactured

by Maruti Udyog) are sold by +u(u"i and manufactured in Pa"istan and other +outh Asian countries# 3he com!any annually e7!orts more than :6 666 cars and has an e7tremely large domestic mar"et in $ndia selling o&er 8.6 666 cars annually# Maruti 866 till 0665 was the $ndiaDs largest selling com!act car e&er since it was launched in 198.# More than a million units of this car ha&e been sold worldwide so far# ,urrently Maruti Alto to!s the sales charts and Maruti +wift is the largest selling in A0 segment# Aue to the large number of Maruti 866s sold in the $ndian mar"et the term ?Maruti? is commonly used to refer to this com!act car model# 3ill recently the term ?Maruti? in !o!ular $ndian culture was associated to the Maruti 866 model# Maruti +u(u"i $ndia Limited a subsidiary of +u(u"i Motor ,or!oration of )a!an has been the leader of the $ndian car mar"et for o&er two decades# $ts manufacturing facilities are located at two facilities @urgaon and Manesar south of Iew Aelhi# Maruti4s @urgaon facility has an installed ca!acity of .:6 666 units !er annum# 3he Manesar facilities launched in February

0668 com!rise a &ehicle assembly !lant with a ca!acity of 166 666 units !er year and a Aiesel =ngine !lant with an annual ca!acity of 166 666 engines and transmissions# Manesar and @urgaon facilities ha&e a combined ca!ability to !roduce o&er 866 666 units annually# More than half the cars sold in $ndia are Maruti cars# 3he com!any is a subsidiary of +u(u"i Motor ,or!oration )a!an which owns :5#0 !er cent of Maruti# 3he rest is owned by the !ublic and financial institutions# $t is listed on the Combay +toc" =7change and Iational +toc" =7change in $ndia# Auring 0668'68 Maruti +u(u"i sold 815 850 cars of which :. 605 were e7!orted# $n all o&er si7 million Maruti cars are on $ndian roads since the first car was rolled out on Aecember 15 198.# Maruti +u(u"i offers 1: models Maruti 866 -mni =steem Caleno Alto *ersa <it( @y!sy A +tar >agon < Hen =stilo +wift +wift A(ire +N5 and @rand *itara# +wift +wift d(ire A star and +N5 are maufactured in Manesar @rand *itara is im!orted from )a!an as a com!letely built unit (,CU) remaining all models are manufactured in Maruti +u(u"iDs @urgaon Plant#

+u(u"i Motor ,or!oration the !arent com!any is a global leader in mini and com!act cars for three decades# +u(u"i4s technical su!eriority lies in its ability to !ac" !ower and !erformance into a com!act lightweight engine that is clean and fuel efficient# Maruti is clearly an Jem!loyer of choiceF for automoti&e engineers and young managers from across the country# Iearly 8: 666 !eo!le are em!loyed directly by Maruti and its !artners# 3he com!any &ouches for customer satisfaction# For its sincere efforts it has been rated (by customers) first in customer satisfaction among all car ma"ers in $ndia for nine years in a row in annual sur&ey by ) A Power Asia Pacific# Maruti +u(u"i was born as a go&ernment com!any with +u(u"i as a minor !artner to ma"e a !eo!leDs car for middle class $ndia# -&er the years the !roduct range has widened ownershi! has changed hands and the customer has e&ol&ed# >hat remains unchanged then and now is Maruti4s mission to motorise $ndia# Pressure started mounting on $ndira and +an%ay @andhi to share the details of the !rogress on the Maruti Pro%ect#

+ince countryDs resources were made a&ailable by mother to her sonDs !et !ro%ect# A delegation of $ndian technocrats was assigned to hunt a collaborator for the !ro%ect# $nitial rounds of discussion were held with the giants of the automobile industry in )a!an including 3oyota Iissan and Bonda# +u(u"i Motor ,or!oration was at that time a small !layer in the four wheeler automobile sector and had ma%or share in the two wheeler segment# +u(u"iDs bid was considered negligible# $n the initial rounds of discussion the giants had their bosses !resent and in the later rounds related to the technical discussions e7ecuti&es of these automobile giants were !resent# -samu +u(u"i ,hairman and ,=- of the com!any ensured that he was !resent in all the rounds of discussion# -samu in an article writes that it subtly massaged their ($ndian delegation) egos and also con&inced them about the sincerity of +u(u"iDs bid# $n the initial days +u(u"i too" all ste!s to ensure the go&ernment about its sincerity on the !ro%ect# +u(u"i in return recei&ed a lot of hel! from the go&ernment in such matters as im!ort clearances for manufacturing e/ui!ment (against the wishes of the $ndian machine tool

industry then and its own socialistic ideology) land !urchase at go&ernment !rices for setting u! the factory @urgaon and reduced or remo&al of e7cise tariffs# 3his hel!ed +u(u"i conscientiously nurse Maruti through its infancy to become one of its flagshi! *ento# 3hey intend to continue to focus on the small car segment while offering !roducts in most segments of the $ndian !assenger car mar"et# 3hey aim to achie&e their !rinci!al ob%ecti&es by !ursuing the following business strategiesL Maintain and enhance their !roduct rangeL 3hey intend to utili(e +u(u"i4s e7!ertise in small car technology to !roduce new &ariants of their e7isting models and to u!grade their !roducts with contem!orary technology and features# $ncrease reach and !enetrationL 3hey !lan to continue to utili(e their e7tensi&e sales and ser&ice networ" to increase the reach in terms of geogra!hical s!read and !enetration in terms of sales &olumes of their !roducts across $ndia# $ncreased a&ailability of automobile financeL 3hey continue to see" o!!ortunities to e7!and the si(e of the

$ndian !assenger car mar"et es!ecially in the small car segment through facilitating easy a&ailability of automobile finance# 3o that end they ha&e recently entered into an agreement with the +tate Can" of $ndia# +ecure re!eat !urchases by offering a J.16 degree customer e7!erienceFL -n the basis of their belief that securing re!eat !urchases from an e7isting customer re/uires less e7!enditure than ac/uiring a new customer they aim to !ro&ide customers with a Jone'sto! sho!F for automobiles and automobile'related !roducts and ser&ices# ,ontinue to benchmar" their manufacturing ca!abilitiesL 3hey !lan to continue to benchmar" our manufacturing ca!abilities with the most efficient car manufacturing facilities of +u(u"i and its subsidiaries# ,ontinue to reduce costs to offer more com!etiti&e !roductsL ,ost com!etiti&eness has been and continues to be central to their strategy as the leading manufacturer in the small car segment to e7!and the si(e of the mar"et by offering com!etiti&ely !riced high /uality !roducts# 3he com!onents of this strategy areL Bigher le&els of locali(ation

*endor !artici!ation in cost reduction ,ost reduction on warranties <eduction in initial in&estment cost <eduction in number of &ehicle !latforms Achie&e further cost reduction through higher !roducti&ity Lower cost of ownershi!L 3hrough their business strategies they see" to reduce the consumer4s cost of ownershi! of their cars which com!rises the cost of !urchase the cost of fuel and maintenance including s!are !arts and re!airs during the life of the &ehicle insurance and resale &alue#

&(W I&I"IA"IV(- I& MA !"I -!/!8I +IMI"(.

@one stop shop to meet all your needs>

$n an effort to become a com!lete car com!any Maruti has entered the car insurance business as well# $t offers the customer all the ad&antages of settling insurance claims directly with any of the com!any4s authori(ed dealers#

3his business !ro&ides com!lete fleet solutions to cor!orate and institutions# Cranded Maruti I0I this ser&ice includes the followingL customi(ed car !olicies economical car leasing maintenance ser&icing registration insurance emergency assistance accident management and e&entual re'sale of cars# MA<U3$ F$IAI,=

Maruti Finance offers the best finance !ac"ages to consumers across the entire Maruti range# 3he ser&ice is being e7tended across the country in a !hased manner#

MA<U3$ @=IU$I= A,,=++-<$=+ A single !oint of contact Bassle'free transactions =mergency Assistance *irtually ,ashless <e!airs Post accident re!airs and insurance su!!ort at any dealer wor"sho!# MA<U3$ 3<U= *ALU= Maruti has ta"en its first ste!s in the !re'owned car business under the brand name of Maruti 3rue *alue# Using their technological e7!ertise networ" su!!ort and the e7!erience they ha&e gained in the last 18 years the com!any ensures the customers gets great &alue and com!letes the transaction (ero hassles#

(5"(&.(. WA

A&")

5 years or 86 666 "ms ,an bought anytime during !rimary warranty best at time of !urchase# AIM3$M= MA<U3$ Maruti +u(u"i has also set u! state'of'the'art call centers (o!erational in Aelhi @urgaon Mumbai ,hennai Cangalore and Byderabad) Cranded Anytime Maruti this 05 hour hel!'line clarifies all doubts and /ueries regarding +u(u"i any time of the day or night#

+IMI"A"I*&-

a# Aue to time and money constraint study was restricted to web only#

b# Aata collection method was secondary and web based only

c# ,om!any don4t want to disclose their core strategies

d# +econdary data is not sufficient to find out the o&erall !lan and mar"eting strategies of any of the com!any

C*&C+!-I*&

3he !rice of a car is %ust one'third of what it cost you o&er its lifetime# <unning and maintaining it ma"e u! the other two'thirds# 3a"e into account resale &alue and its real cost becomes clear# Maruti +u(u"i stands for &alue as much as it stands for !erformance# $n s!ite of rising in!ut costs we try our best to "ee! !rices down# 3heir running costs and resale &alues are unbeatable too# Iothing matches the delight their cars deli&er# $n the )A Power ,+$ study 066: 8:2 of Maruti +u(u"i owners stated that they would definitely recommend the car they dri&e to someone else# $n fact you don4t buy a Maruti +u(u"i# Mou in&est in it# After the rash of new cars launches the !ast two years the relati&e lull in the auto industry is showing u! in the customer satisfaction indices# According to the 066: four'wheeler 3otal ,ustomer +atisfaction (3,+) study conducted by the s!ecialist di&ision of 3I+ Automoti&e the automobile ownershi! e7!erience or customer ownershi! e7!erience has declined in all areas com!ared to 0665# 3he study is one of the largest syndicated automoti&e studies in $ndia re!resenting the res!onses of more than 8 666 new car buyers# 3he com!rehensi&e study co&ers o&er :6 models with customer e&aluations ta"en in the "ey areas of sales satisfaction !roduct /uality &ehicle !erformance and design after'sales ser&ice brand image and cost' of ownershi!# 3he 3,+ inde7 score !ro&ides a measure of satisfaction and loyalty a gi&en model en%oys with its customers# According to 3I+ Automoti&e the decline is !redominantly for older small and entry mid'si(e car models# 3he ageing of these models seems to be !osing a stiffer challenge for manufacturers to sustain !ast !erformance le&els at a time when customer e7!ectations are rising shar!ly#

(C*MM(&.A"I*& A&. -!''(-"I*&

@reat o!!ortunities to go global with success of +wift and +N5 all o&er# $ntroduction of more diesel models# 3he diesel car segment is growing# -!!ortunity to grow bigger by entering into bigger car mar"ets# Already a mar"et leader so great o!!ortunity to be the "ing of mar"et in e&ery stage of industry

7I7+I*' AP%)
7**8-

T +trategic Management and Cusiness Policy by 3homas L# >heelen )# Aa&id Bunger ;rish <angara%an &(W- PAP( T 3B= =,-I-M$, 3$M=+ T 3B= 3$M=+ -F $IA$A MA'A/I&(T CU+$I=++ $IA$A T $IA$A 3-AAM I&"( &(" W(7-I"(T www#scribd#com T www#google#com T www#maruti su(u"i #com