Automobile Industry Impact on Indian Consumers Assignment Sample

Assignment

The Merging Global Trends and Growth of Sports Car Segment in

Automobile Industry on Indian Consumers

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The Merging Global Trends and Growth of Sports Car

Segment in Automobile Industry on Indian Consumers

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INTRODUCTION ........................................................................................................................................1

BACKGROUND AND RATIONALE OF THE RESEARCH ....................................................................2

AIMS AND OBJECTIVES ..........................................................................................................................4

RESEARCH QUESTIONS ..........................................................................................................................4

RESEARCH METHODOLOGY..................................................................................................................5

Data collection method .............................................................................................................................5





INTRODUCTION

From the early 1769, the history of automobile was begun with the development of steam-

powered automobile, which is capable for human transport. Further, in the year 1806, the first car was

developed, which was powered by internal combustion engines being run on fuel and gas. Soon, after this

many other inventions were done by Karl Benz and Gottlieb Daimler and Wilhelm MayBach, which

have drifted the automobile industry into the new world (Fuxman,1999). There are many nations, who

are manufacturing and dealing in automobiles, however, the three big countries, which are highest in

automobile manufacturing are USA and Canada, Japan and Germany. The largest automakers of USA

are General Motors, Chrysler and Ford. These three are being regarded as the “Detroit three”. These big

three companies are being distinguished by their size, geography as well as business model. Most of their

operations are unionized i.e. United Auto Workers and Canadian Auto workers, which results in higher

amount of labor costs as compared to other multinational automakers. General Motors, Chrysler and

Ford were the largest in the world just for a while, however due to competition in the market they have

lost their position (Anderson and Anderson, 2010). Two from them are still in a mainstay of top five.

Japan is being considered as the leader at producing small and more efficient cars. The automakers

of Japan are Toyota, Nissan and Honda and they are regarded as best among all other brands. Because of

the oil crisis in the year 1973, the Vehicles of these companies were brought to the forefront. This can be

well attributed from the instance that the Honda Civic was being regarded as far better or in other

words superior than the American competitors such as Ford Pinto and Chevrolet Vega. On the other

hand, the automobile industry of Germany is one of the largest in providing employment opportunities

to the locale people. Further, the nation has the largest share, say around 29% of passenger car production

in Europe (Kumar and Yamaoka, 2007).

When speaking in regards with the automobile industry of India, it has grabbed the number one

position in the world and is being considered as one of the fastest growing industry all across the globe.

Around 11million vehicles are being manufactured by India and 1.5 million are exported to other

nations of the world. They are number one in manufacturing motorcycles.

Due to the economic liberalization in 1991, the Indian automotive industry has demonstrated

sustainable growth. This all were resultant of increased competitiveness and relaxed restrictions

(Tracking technology innovation trends: Mapping future prosperity of nations, 2002). There are many

automakers in India such as Maruti Suzuki, Tata Motors, Mahindra and Mahindra, have expanded their

global reach and started their operations in the international markets. In addition to this, because of the





robust economic growth, the domestic automobile market of India was expanded and in turn has

attracted much India-specific investment by the multi-national manufacturers of automobile

(Bradsher, 1999). In the year 1897, the first acre was brought on the Indian roads. However, until 1930s

cars were imported from other parts of the world directly. Following with the independence in the year

1947, the private sector along with government of India has made significant attempts and efforts in

order to create an automotive component manufacturing industry with a view to supply to the

automobile industry (Westbrook, 2001). However, between the years 1950-1960, the growth was

relatively slow due to the license raj and nationalization. Both of these have hampered the private sector

in India. Attributed from the above discussion, it becomes very important to comprehend the global trend

in the automobile market particularly in the sports car segment (Elliott, 2001).

BACKGROUND AND RATIONALE OF THE RESEARCH

The automotive industry usually designs, manufacture, develop, market and sell the motor vehicles

to all the potential customers. This sector is also being regarded as one of the most important economic

sector in the world in terms of revenue generation. There are many nations, whose sustenance is largely

dependent on this particular sector. Further, countless companies are scattered all around the world,

which are involved in the manufacturing of automobiles and drifting their economy towards growth

and success (Tidd and Bessant, 2009).

There are three big manufacturers in the world being known as the Big three i.e. Germany, Japan and

USA. In order to succeed in the market, the big three automakers has made several deals with unions

with a view to reduce the wages and developed pension and healthcare commitment to their workers.

When talking in terms of the automobile industry in India, it is one of the largest in the world. In

Chennai, a chunk of car manufacturing industry is based and is being known as the Detroit of India.

Further, there is various emission norms, which need to be abide by all the companies engaged in

automobile manufacturing. With a view to be in tune with the international standards in regards with

reducing the vehicular pollution, the central government has unveiled the standards being titled as

“India 2000” in the year 2000 (A global leader in critical automotive systems… seating & electrical

distribution, 2012).





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India is large, still large numbers of firms are reluctant to tap its potential as a sports car market. There

are handfuls of people, who owe sports car in India with special permits. Further, purchasing a sports car

is a very tedious process such that many people are required to import their car from other nations of the

world. In addition to this, the conditions of the Indian roads are very miserable such that the low

ground clearance did not allow it to be feasible (Allen and Hamilton, 1999). There are many

international companies like, Lamborghini and Porsche does not have showrooms according to the

number of cars sold. In India, the market for supercars and sports car is not very large because of its

expensiveness and this, limits the purchasing power of most of the people. Now, this trend is gradually

changing with more number of Indian consumers becoming potential buyers of sports car. In India, the

market for supercars and sport cars is growing at a skyrocket pace and this is the best time to enter

into the Indian market. Large number of luxury cars and other manufacturers are now moving their

step ahead in the Indian market with large amount of infrastructural development. McLaren along with

Lamborghini or BMW are looking India as a potential lunch ground of their new products and cars

(Allsopp, 2005).

AIMS AND OBJECTIVES

The main aim of the present research is to analyze the perception of Indian consumers about the growth

and emerging global trends in the sports car segment in automobile industry. With a view to achieve

these aims, following objectives needs to be fulfilled:

To identify the spending power of the Indian consumers in order to buy a sports car

To evaluate the type of brands being preferred by buyers, while buying sports car

To analyze the factors that affects the customers at the time of making purchase of sports car

RESEARCH QUESTIONS

What is the spending power of the Indian consumers while buying a sports car

What type of brands are being preferred by buyers, while buying sports car

Which factors affects the customers at the time of making purchase of sports car





RESEARCH METHODOLOGY

The foundation of the survey of the project is being shaped by the theoretical statement of the research

and this part of the dissertation helps in providing these statements. Further, the research methodology

section of the report provides a concise understanding about various strategies, tools and techniques

that will be applied by the researcher for the purpose of carrying out the current research (Gill and

Johnson, 2002). Here, in this current research report, both qualitative and quantitative research will be

adopted by the researcher. Further, both primary and secondary research methods will be used in the

study. Primary research will be conducted by undertaking a survey. On contrary to this, secondary

research will be carried out by exploring various journals, articles and books of renowned authors and

scholars.

Data collection method

Generally, there are two types of data, which can be collected by the researcher for the purpose of

undertaking a successful research. These data are primary and secondary. Primary data is being regarded

as one of the most important data, as seeking help from this data more reliable and accurate information

can be gathered. Such type of data is accumulated for the first time by the researcher (Research

Methodology, n.d). On the other hand, secondary data is defined as that data, which are already

present and used by many other researchers as a basis of their research study. In other words, such type of

data is gathered earlier for some other research purposes. In this present research study, the researcher has

made use of both primary and secondary source of data collection methods. The primary data will be

gathered by carrying out the survey.

A survey will further be performed by getting questionnaires filled by the customers. Both open and

close ended questions will be used in order to explore their perception about the growth and emerging

global trends in the sports car segment in automobile industry. On contrary to this, secondary data will be

accumulated by investigating various books, articles and journals related to automobile industry and its

trends in the global market. Further, various online and internet means will also be explored by the

researcher by taking into consideration the topic of the research study.





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Limitation of time is the major challenge being faced by the researcher. Because of the shortage of

time, it was very difficult for the researcher to unfold more detailed aspects of the topic under study.

Further, the resources were also very limited, due to which proper research was not

carried out (Goddard and Melville, 2004).

In this present research study, secondary source of data collection will be used by the

researcher and thus, there are more likely chances that the viewpoint of various authors can be

prejudiced. Information collected from diverse sources might not relate with main aspects of

research.

Lastly, it was also difficult for the researcher to explore detailed aspects of sports car segment, as

sports car manufacturer does not have showrooms in India.





REFERENCES

Allen, B. and Hamilton, 1999. Challenges Facing the Global Automotive Industry. Insights. 1(1).

pp.1-8.

Allsopp, J., 2005. Premium pricing: Understanding the value of premium. Journal of Revenue

and Pricing Management. 4. pp.185-194.

Anderson, C.D. and Anderson, J., 2010. Electric and Hybrid Cars: A History. 2nd ed. McFarland.

Boyatzis, R.E., 1998. Transforming Qualitative Information: Thematic Analysis and Code

Development. 2 ed. SAGE.n.d

Bradsher, K., 1999. The Unsung Comeback of the Large Car. The New York Times. 3. pp. 7-9.

Elliott, C., 2001. A cointegration analysis of advertising and sales data. Review of

Industrial

Organization. 18. pp.417-426.

Fuxman, L., 1999. Teamwork In Manufacturing: The Case Of The Automotive Industry.

International Journal of Commerce and Management. 9(1/2). pp.103 – 130.

Gill, J. and Johnson, P., 2002. Research Methods for Managers. 3rd ed. London: SAGE

Publications Ltd.

Goddard, W. and Melville, S., 2004. Research Methodology: An Introduction.2nd ed. Juta and

Company Ltd.

Kumar, S. and Yamaoka, T., 2007. System dynamics study of the Japanese automotive industry

closed loop supply chain. Journal of Manufacturing Technology Management. 18(2).pp.115

– 138.

Maples and et. al., 1998. Vehicle Consumer Characteristics and Trends Data Book

(PreliminaryDraft). U.S. Department of Energy, Office of Transportation Technologies. pp. 54-

55.

Tidd, J. and Bessant, J., 2009. Managing Innovation. Integrating Technological Market and

the Organizational Change. 4 ed. Johns Wiley & Sons Ltd.

Tracking technology innovation trends: Mapping future prosperity of nations. 2002.

Strategic Direction. 19(5). Pp. 33 – 35.

Westbrook, M.H., 2001. The Electric Car: Development and Future of Battery, Hybrid and

Fuel-Cell Cars. IET.Online


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Automobile Industry Impact on Indian Consumers Assignment Sample