Bajaj the Way Ahead

7/29/2019 Bajaj the Way Ahead

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BAJAJ : THE WAY AHEAD

LEARNING FROM

EMERGING MARKETS


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INTRODUCTION

Founded in 1945. Bajaj Auto first sold imported two- and three-wheeled scooters

before obtaining a license from Indias government to become

a manufacturer in its own right, in 1959.

Currently Bajaj is Indias second-largest motorcycle producer,selling nearly three million vehicles annually and operating in

more than 50 countries.

Rajiv Bajaj has been managing director of the company since

2005.


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PROFILE OF RAJIV BAJAJ

BORN DECEMBER 21, 1966

EDUCATION Graduated with a degree in

Mechanical engineering in 1988

from University of Pune.

Received an MS in

manufacturing systemsengineering in 1991 from the

University of Warwick.

CAREER

HIGHLIGHTS

MANAGING DIRECTOR [2005-

PRESENT].

Joint managing director (2003

05).

President and whole-time

director (200203).


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EVOLUTION OF INDIAN MARKETS

Due to liberalization and globalization, Indian economy is

making tremendous progress.

It has grown as a powerful economy.

As a result, the purchasing power of the people have increased.

There has been a significant increase in demand for consumer

durables in general and particularly automobiles.

Indias markets are not just underpenetrated but also under

segmented.


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BAJAJ : AN EMERGING-MARKET

CHAMPION

Bajaj is present in over 50 countries all over the globe.

Dominant presence in Africa, Latin America and South Asiawith increasing market share every year.

Market leader in motorcycles in Colombia, Central America,

Sri Lanka, Bangladesh, Philippines, Nigeria, Uganda andKenya.

891,002 units exported in 2009-10, an increase of over 15 %over the previous year.

Total motorcycle exports of 726,115 in 2009-10, growth of15% over 2008-09.

Largest exporter of three wheeled commercial vehicles in theworld: 164,887 units exported in 2009-10, a rise of 19% over2008-09.


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Emerging-market champion means aligning organizations

ideas, energies, and resources toward building a few key

motorcycle brands that, collectively, could make them one ofthe worlds most comprehensive and profitable motorcycle

makers.

It means building and positioning Bajaj as a global motorcycle

specialist and, given the rapid pace of evolution of automarket, leveraging the expertise and experience to expand into

emerging markets.


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MEETING ASPIRATIONS OF

CONSUMERS

There are two kinds of global motorcycle makers : Niche.

Mass.

Their strategy consists of bringing together the best of both themarkets, so that consumers are able to experience the pride ofowning an aspirational motorcycle brand.

What People expect : Reasonable Mileage.

Modern Appealing Avatar (especially the youth). Bajaj Auto understands the pulse of the masses, and its

portfolio appeals to anyone who wishes to buy a two wheelerthat can withstand the test of time.


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Bajaj Auto helped translate the dreams and aspirations of the

Indian consumers into tangible reality at a time when other

players were focussing on cost cutting. E.g. Bajaj Pulsar, Bajaj Discover, Bajaj Platina.


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CONSUMER NEEDS AT GLOBAL

LEVEL

The consumers across the globe look for similar attributes in

their products.

The way they position their brands and the product mix are

certainly strongly influenced by the local context consumers. Bajaj has assembly facilities in many overseas markets

including Indonesia and Nigeria.

They main aim is to strike a balance between quality & cost.


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AFFORDABILITY & ACCESSIBILITY

AFFORDABILITY

They measure affordability as the monthly cost of

ownership of our product, adjusted for resale price, relative

to the competition. ACCESSIBILITY

In terms of accessibility, they aim to have sales and service

facilities within a 30-minute radius of their consumers,

wherever they may be.


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INNOVATION

The unique business model, which rests on selling specialized

brands at the front end, derived from flexible platforms at the

back end.

Inspired by DTSi (Digital Twin Spark Ignition) innovation,

Bajaj did already set in to revolutionize the two-wheeler

industry with fuel-efficient engine.


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MEETING NEEDS AT GLOBAL

LEVEL Their focus on their ability to continually improve the

alignment between new categories and current core

competencies.

They need to figure out how to take what they know and do

well and to make it appeal to consumers in other markets.

Working harmoniously with the global partners, KTM and

Kawasaki.


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LEARNING FROM OBSERVING & COMPETING

WITH INTERNATIONAL PLAYERS

From their European partner KTM, they learned the principles

of sharply positioning a brand as opposed to promoting a

diffused product.

Building diverse consumer segments.

From their Japanese partner Kawasaki, they learned the

principles of building a responsive supply chain.

CHINESE MARKET :- Most Chinese motorcycles are poor

examples of strategy, quality and profits; that is why they are

not in India or any similar evolved market.

Lessons from TATA Nano:- Alignment.

Less is more.


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LESSONS INTERNATIONAL PLAYERS CAN

LEARN

From their market, international companies can appreciate the

rich rewards of bridging brand aspirations and affordability.

By looking at their business model and success in India and

elsewhere, International players can understand some of theprinciples of building such a bridge.


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BAJAJ : TEN YEARS FROM NOW

They are going to do their best to establish Bajaj as the largest

garage of some of the worlds most specialized motorcycle

brands.

Limitless growth opportunities : They aspire to grow atleast

2-4 times from where they are right now.


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Documents

Bajaj the Way Ahead