Introduction to the Industry 1.1 Indian Automotive Industry Indian automotive industry globally is among the top ten. With an annual production of over two million units and providing employment opportunities to more than 13 million people, the automobile industry in India achieved a turnover of US $34 billion (INR 165000 crores). Currently, the installed production capacity of automobile industry in India is 9.54 million vehicles annually comprising around 7.95 million 2/3 wheelers and 1.59 million 4-wheelers. India at present is the largest manufacturer of tractors, second largest manufacturer of 2-wheelers and fifth in manufacturing commercial vehicles. India ranks fourth in Asia in terms of passenger car market and is the head-quarter of the world’s largest 2-wheeler manufacturer. India now has: 9 manufacturers of commercial vehicles; 15 passenger and multi-utility car manufacturers; 14 manufacturers of 2/3 wheelers; 14 number of tractor manufacturers; 5 automobile engine manufacturers. The growth of the automobile industry has encouraged world automotive giants in setting up operation in India. Presently there are eleven multi-national automobile manufacturing companies operating in India.

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Introduction to the Industry

1.1 Indian Automotive Industry

Indian automotive industry globally is among the top ten. With an annual production of over

two million units and providing employment opportunities to more than 13 million people,

the automobile industry in India achieved a turnover of US $34 billion (INR 165000 crores).

Currently, the installed production capacity of automobile industry in India is 9.54 million

vehicles annually comprising around 7.95 million 2/3 wheelers and 1.59 million 4-wheelers.

India at present is the largest manufacturer of tractors, second largest manufacturer of 2-

wheelers and fifth in manufacturing commercial vehicles. India ranks fourth in Asia in terms

of passenger car market and is the head-quarter of the world’s largest 2-wheeler

manufacturer. India now has:

9 manufacturers of commercial vehicles;

15 passenger and multi-utility car manufacturers;

14 manufacturers of 2/3 wheelers;

14 number of tractor manufacturers;

5 automobile engine manufacturers.

The growth of the automobile industry has encouraged world automotive giants in setting

up operation in India. Presently there are eleven multi-national automobile manufacturing

companies operating in India.

1.2 Major Indian automobile manufacturers

The major Indian automotive industries are:

1) Tata Motors – Tata Motors previously called TELCO is a leading manufacturer of both

commercial and passenger 4 wheelers and goods carriers. Indica, Indigo, Sumo, and Safari

are few of its passenger car models.

2) Ashok Leyland – Ashok Leyland, is an automobile major specialized in manufacturing

commercial passenger and goods vehicles. Viking and Cheetah are notable commercial

passenger vehicle models, while Comet Tractor is a widely acclaimed goods carrier model.

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3) Mahindra and Mahindra – Mahindra & Mahindra is a manufacturer of sports utility

vehicles, light commercial vehicles, and tractors. Scorpio is a popular sports utility

automobile, while Bhoomiputra is a renowned tractor model.

4)Maruti Suzuki – This premier car manufacturer caters to all sectors of the Indian car

market. Maruti 800 and Alto are economy models, D-Zire their up-market luxury car model,

and Grand Vitara a sports utility vehicle model.

5)Hindustan Motors Limited – This pioneering automobile industry in India manufactures

Ambassador brand of passenger cars. It also sells Mitsubishi and Chevrolet vehicles in


6) Force Motors – Force Motors manufactures 3 wheelers, tractors, light commercial and

multi-utility vehicles.

7) Bajaj Auto – Bajaj Auto is a leading manufacturer of motor cycles, scooters, and three

wheelers. Bajaj Pulsar is a leading motorcycle model, and Kristal –DTSi is a widely

accepted model of scooter.

8) Hero Honda – Hero group is synonymous with 2-wheelers in India. Splendor Plus and

Ambition are popular motor cycle models manufactured by HeroHonda. Their range of

bicycles is widely acclaimed throughout India

Fiat, BMW, Ford Motors, Hyundai, General Motors, and Honda are some of the

international companies with operations in India.

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1.3 Automobile (Car) industry in India

The automobile industry in India—the tenth largest in the world with an annual production

of approximately 2 million units—is expected to become one of the major global automotive

industries in the coming years.[2] A number of domestic companies produce automobiles in

India and the growing presence of multinational investment, too, has led to an increase in

overall growth.[3] Following the economic reforms of 1991 the Indian automotive industry

has demonstrated sustained growth as a result of increased competitiveness and relaxed

restrictions.[3] The monthly sales of passenger cars in India exceed 100,000 units. [4]

1.3.1 History

In 1953, the government of India and the Indian private sector initiated manufacturing

processes to help develop the automobile industry, which had emerged by the 1940s in a

nascent form.[8] Between 1970 to the economic liberalization of 1991, the automobile

industry continued to grow at a slow pace due to the many government restrictions.[8] A

number of Indian manufactures appeared between1970-1980.[8] Japanese manufacturers

entered the Indian market ultimately leading to the establishment of Maruti Udyog. [8] A

number of foreign firms initiated joint ventures with Indian companies.[8]

1.3.2 Snippets

· The first automobile in India rolled in 1897 in Bombay.

· India is being recognized as potential emerging auto market.

· Foreign players are adding to their investments in Indian auto industry.

· Within two-wheelers, motorcycles contribute 80% of the segment size.

· Unlike the USA, the Indian passenger vehicle market is dominated by cars (79%).

· Tata Motors dominates over 60% of the Indian commercial vehicle market.

· 2/3rd of auto component production is consumed directly by OEMs.

· India is the largest three-wheeler market in the world.

· India is the largest two-wheeler manufacturer in the world.

· India is the second largest tractor manufacturer in the world.

· India is the fifth largest commercial vehicle manufacturer in the world.

· The number one global motorcycle manufacturer is in India.

· India is the fourth largest car market in Asia - recently crossed the 1 million mark.

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1.3.3 Timeline of Indian automobile industry:

1905 Fiat Motors

1911 First Taxi in India

1924 Formation of traffic police

1928 Chevrolet Motors

1942 Hindustan Motors

1944 Premier Auto Limited

1945 Tata Motors

1947 Mahindra Motors

1948 Ashok Motors

1948 Standard Motors

1974 Sipani Motors

1981 Maruti Suzuki

1994 Rover Motors

1994 Mercedes Benz

1994 Opel

1995 Ford Motors

1995 Honda SIEL

1995 Reva Electric Car Company

1995 Daewoo Motors

1996 Hyundai Motor Company

1997 Toyota Kirloskar Motors

1997 Fiat Motors (Re-Entry)

1998 San Motors

1998 Mitsubishi Motors

2001 Škoda Auto

2003 Chevrolet

2005 BMW

2007 Audi

2009 Land rover and jaguar

Following the economic reforms of 1991, the automobile section underwent delicensing and

opened up for 100 percent foreign direct investment(FDI).[3] A surge in economic growth

rate and purchasing power led to growth in the Indian automobile industry, which grew at a

rate of 17% on an average since the economic reforms of 1991. [3] The industry provided

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employment to a total of 13.1 million people as of 2006-07, which includes direct and

indirect employment.[3] The export sector grew at a rate of 30% per year during early 21st

century.[3] However, the overall contribution of automobile industry in India to the world

remains low as of 2007.[3] Increased presence of multiple automobile manufacturers has led

to market competitiveness and availability of options at competitive costs.[3] India was one

of the largest manufacturers of tractors in the world in 2005-06, when it produced 2,93,000

units.[3] India is also largely self-sufficient in tyre production, which it also exports to over 60

other countries.[3] India produced 6.5 crore tyres in 2005-06.[3]

1.3.4 Overview

India’s car market has emerged as one of the fastest growing in the world. The number of

cars sold domestically is projected to double by 2010, and domestic production is

skyrocketing as foreign makers are setting up their own production plants in India. The

government’s 10-year plan aims to create a $145 billion auto industry by 2016.

According to McKinsey & Company, the auto sector’s drive to lower costs will push

outsourcing. The auto sector could be worth $375 billion by 2015, up from $65 billion in

2002. McKinsey thinks India could capture $25 billion of this amount. Out of 400 Indian

suppliers, 80 percent have the ISO 9000 certificate—the international standard for quality


The production of automobiles in India is largely aimed at local consumers. [10] Several

Indian manufacturers also export a diverse variety of auto components.[11] Tiku (2008)

predicts a sale of 42 lakhs four wheeler automobiles in India by 2015.[12] Indian passenger

vehicle exports are also expected to rise from 1,70,000 in 2006 to 5,00,000 in 2010.[11]

The following links gives the complete picture of Indian Auto




The first auto vehicle rolled out in India at the end of 19th century.

Today, India is the 2nd largest tractor and 5th largest commercial

vehicle manufacturer in the world. Hero Honda with 1.7M motorcycles

a year is now the largest motorcycle manufacturer in the world.



On the cost front, OEMs eyeing India in a big way to source products

and components at significant discounts to home market. On the

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revenue side, OEMs are active in the booming passenger car market in


Industry Growth The passenger car and motorcycle segment in Indian auto market is

growing by 8-9 per cent. The two-wheeler segment will clock 11.5%

rise by 2007. Commercial vehicle to grow by 5.2 per cent.



India is the 11th largest Passenger Cars producing countries in the world

and 4th largest in Heavy Trucks. Maruti Udyog Ltd. is the leading 4-

wheelers manufacturer. Hero Honda is the leading 2-wheelers


Auto Export Passenger vehicle exports have grown over five times and two-wheeler

exports have reached more than double. Exports of auto components,

whose manufacturing costs are 30-40 per cent lower than in the West,

have grown at 25% a year between 2000 to 2005.

Auto Companies Hero Honda is the largest manufacturer of motorcycles. Hyundai Motors

India is the second largest player in passenger car market. Tata Motors

is the fifth largest medium & heavy commercial vehicle manufacturer in

the world.



Know about the number of vehicles registered as Transport or Non-

Transport in the Indian states and Union Territories.

Associations Get all the contact details of Automobile Association of Upper India

(AAUI), Automotive Research Association of India (ARAI),

Automobile Association of Southern India (AASI), Automotive

Component Manufacturers Association of India (ACMA) and more

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1.3.5 Exports

A number of car plants in India export some of their cars from there to generate greater

volumes of production in order to achieve the economies of scale and be profitable. These


Tata Motors - exports Tata Safari, Indigo Marina

Mahindra & Mahindra – Scorpio, Xylo

Maruti Suzuki - exports Suzuki Alto, Maruti 800, Suzuki Omni, Wagon R and Zen Estilo

Hyundai Motor Company - exports Hyundai Santro, Verna i10, Hyundai Getz, i20 and

Hyundai Accent - 42% of its India production

Government has liberalized the norms for foreign investment and import of technology and

that appears to have benefited the automobile sector. The production of total vehicles

increased from 4.2 million in 1998- 99 to 7.3 million in 2003-04. It is likely that the

production of such vehicles will exceed 10 million in the next couple of years.

The industry has adopted the global standards and this was manifested in the increasing

exports of the sector. After a temporary slump during 1998- 99 and 1999-00, such exports

registered robust growth rates of well over 50 per cent in 2002-03 and 2003-04 each to

exceed two and- ahalf times the export figure for 2001-02.

The Indian automotive export industry presently is finding a good recognition globally. The

auto industry along with the component industry is contributing to the export effort of the

country. In 2002-03, the export of the automobile industry had registered a growth rate of

65.35%. In 2003-04, it was 55.98%. The following table briefs about the 2003-04 and 2004-

05 (upto April-Dec. 2004) automobile export in numbers.

Category 1998-99 2004-05 (Apr-Dec)

Passenger Car 25468 121478

Multi Utility Vehicles 2654 3892

Commercial Vehicles 10108 19931

Two Wheelers 100002 256765

Three Wheelers 21138 51535

Percentage Growth -16.6 32.8

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Export of Auto Components:

Investments in the auto ancillary sector are rising rapidly. In 1997, the size of the auto

component industry was US$ 2.4 billion and now in 2004-05 it has become US$ 8.7 billion

industry. The export of auto components has grown at a compounded growth rate of 19 per

cent over the past six years.

Analysis of Indian Exports:


Cost competitiveness in terms of labor and raw material.

Established manufacturing base. Economics of scale due to domestic


Potential to harness global brand image of the parent company.


Perception about quality.

Infrastructure bottlenecks.



Huge export markets such as Europe, America, Africa, and others for

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Indian cars.


China, Malaysia, Thailand, etc.

Many other countries also have strategies for export promotion.

Export Imperatives:

Internal Factors:

Attaining high quality for global standards.

Continuous cost reduction for global competitiveness.

Supply chain management (logistics).

Attaining economies of scale & scope.

External Factors:

Improve infrastructure (ports, roads, etc). Improve EXIM regulation

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1.3.6 Indian automobile companies

The following are some of the notable Indian automobile manufacturers which has long fleet

of cars:

Company Description Product



Ashok Leyland is a commercial

vehicle manufacturing company

based in Chennai, India. In 1948,

Ashok Motors was set up in what was

then Madras, for the assembly of

Austin Cars. The Company's name

changed soon with equity

participation by British Leyland and

Ashok Leyland commenced

manufacture of commercial vehicles

in 1955. Ashok Leyland has six

manufacturing plants: a plant at

Ennore near Chennai, two plants at

Hosur (called Hosur I and Hosur II,

along with a press shop), and the

assembly plants at Alwar and


18 seater to 82 seater double-decker

buses, 7.5 tonne to 49 tonne in

haulage vehicles, special application

vehicles, and diesel engines for

industrial, marine and genset


Force Motors Force Motors, formerly Bajaj Tempo,

is a Pune-based manufacturer of a

number of commercial vehicles

Gas-cylinder carrier, copied from 3-

wheel Vidal & Sohn Tempo-Werke

(German) Hanseat; Matador, a

version of Hanomag van and light-

truck (1.5 tonne payload); Tempo-

traveller, Indian version of Daimler-

Benz T-1 transporter; Man-Force

Trucks, licensed version of MAN AG

trucks; and UV's copied from

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Hindustan Motors is one of the oldest

Indian car manufacturers in India. It is

perhaps best known for the

Ambassador which has remained

virtually unchanged for about 30

years. It is still very popular as a taxi

and is widely used by Indian


Trekker (discontinued), Landmaster

(discontinued), Contessa

(discontinued)—5th generation

Vauxhall Victor, and the Ambassador

—a version of the 1950s Morris


Mahindra &



The automotive section of Mahindra

started off when a first batch of

seventy five Utility Vehicles (UVs)

was imported in CKD condition from

Willys in 1947. It presently

manufactures Jeeps along with

agricultural equipment and light


Armada (discontinued), Voyager

(discontinued), Bolero. Commander,

CL, MaXX, Scorpio, and Mahindra

and Mahindra Classic, Mahindra Xylo

Maruti Suzuki Maruti Suzki (formerly Maruti Udyog)

was formed as a partnership between

the Government of India and Suzuki

of Japan. It brought India its first

"affordable" car, the Maruti 800. It is

the biggest car manufacturer in India

and especially dominant in the small

car sector. Then it brought out the

Maruti 1000, made by Maruti Udyog

was the first ever contemporary

sedan-type car launched in India. The

car (which Suzuki sold in other

countries as the Cultus/Swift/Geo

800, O mni, Alto, Gypsy, Swift, SX4,

Wagon-R, Versa, Zen Estilo, Grand

Vitara, and Swift Dzire.

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Metro with a 1.3 L or 1.6 L engine)

was introduced in October, 1990.

Sold at Rs. 3.81 lakh, it was back

then the costliest car released in the

Indian market. Then the company

replaced it with Esteem and from that

days on a line of Suzuki cars rolled

out in the Indian market.




Walchand Hirachand started Premier

Automobiles Ltd. (PAL) in 1942. They

assembled DeSoto and Plymouth

cars in 1946 in association with

Chrysler from the United States. They

also manufactured the Premier

Padmini which was a version of the

Fiat 1100.

Padmini (discontinued), 118 NE

(discontinued), and Premier Sigma.


REVA Electric Car Co. is the producer

of the Reva (G-Wiz), an electric car

intended for use as a City car. More

REVAs have been produced than any

other currently selling electric car and

sales are increasing. It is currently the

world's leading electric car

manufacturing company.

REVA (G-Wiz).

Tata Motors Tata Motors, formerly known as

TELCO, is the largest automobile

manufacturer in India and commands

more than 70% of the commercial

vehicle market in India and has also

increased its share of passenger

Indica, Indigo, Indigo Marina, Safari,

Sumo, TL, and Tata Nano.

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vehicle market. It was responsible for

developing India's first indigenous

vehicle, the Indica. It has proved to be

a success in the market after initial

quality problems. The company also

exports the car to many countries.

Tata owns major stake in Jaguar and

Range Rover.

In addition to Bangalore-based REVA, which currently is the only company actually selling

EVs today, electric cars made in India includes:

Mahindra & Mahindra: Four-seat model by 2010.[13]

Ajanta Group: clockmaker with plans for low-cost EV.[15]

Tara: Low-cost EV less than a Tata Nano.[16]

Hero Electric: 2013 Electric car.[17]

1.3.6 Multi-national companies in India

Company Description Product


In January 2008, Audi started

production with the Audi A4 and A6 at

its factory in Aurangabad in the state of


A4, A6, A8, R8, Q7, and TT.

BMW BMW is a manufacturer of sport

sedans. BMW enjoys good brand

recognition in India. It has set up a

plant in Chennai, Tamil Nadu, to

manufacture cars locally exclusively for

the local market with no plans for

export. It set up the plant to circumvent

3 Series, 5 Series, 6 Series, 7 Series,

X3,X5and X6.

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high import duties.


It roped in Sachin Tendulkar as one of

its brand ambassadors. Even Michael

Schumacher appeared in an ad for the

Palio. It has entered now into an

alliance with Tata Motors to jointly

manufacture cars at its plant in

Ranjangaon, near Pune. The facility

will enable the two companies to make

about 2,00,000 cars per annum, and

also house an engine manufacturing

unit with a capacity of 2,50,000 units

per annum. The alliance will also see

Tata Motors use Fiat's diesel

technology—the 1.3 litre multijet diesel

engine—for its own vehicles. The two

companies also have a distribution and

service partnership.

The Fiat Uno was one of the first

products to be introduced. The Fiat

Palio/Fiat Siena was later introduced

and was initially a success with its

style and ride comfort coupled with

solid build but has slowly lost its sheen

due to low fuel efficiency. Other

models were introduced such as the

Palio Weekend, Palio Stile and

Adventure. Fiat tried re-branding of the

Fiat Siena to Fiat Petra without much

success. Fiat Bravo—sold in

collaboration with Tata Motors, Fiat

500—sold in collaboration with Tata

Motors, and Fiat Linea—sold in

collaboration with Tata Motors.

Ford Motor


Ford entered India in collaboration with

Mahindra & Mahindra in 1995 with a

plant in Tamil Nadu. The first model

was the Escort.

Escort (discontinued), Ikon,

Endeavour, Fusion, and Fiesta.



Chevrolet has been a recognized

brand in India for several decades. The

model lineup consists of vehicles from

cheaper sister brands like Daewoo.

General Motors initially entered India

with the Opel brand, but the Opel

brand was dropped in March 2006

because sales were at an all time low

Tavera—rebadged Isuzu Panther,

[[First Generation Subaru Forester,

Aveo—second Generation Daewoo

Kalos sedan, Aveo UV-A—first

Generation Daewoo Kalos hatchback,

Optra—rebadged Daewoo Lacetti,

SRV—rebadged Daewoo Lacetti,

Spark—formerly Daewoo Matiz in

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due to high prices and General Motors

wanted to focus more on their

Chevrolet brand. Since the Chevrolet

brand was introduced in India, there

have been no new Opel products.

GM's Indian operations were originally

a JV between Hindustan Motors and

GM, with most of GM's vehicles

assembled at Hindustan's plant in

Halol, Gujarat. Since then, GM India is

now wholly owned by GM.

India, and Captiva—recent launch in



Honda Siel Cars entered India in 1995.

It sells 4 cars in India—the City, Civic,

Accord, and CR-V. The manufacturing

plant of Honda Siel is located in

Greater Noida. The model of Accord

sold in India is the 2003 model. The

most inexpensive car from Honda—

The City. The most expensive—The

Honda Accord V6.

Accord, City, Civic, and CR-V.


When Hyundai entered India, the

brand was virtually unknown in the

Indian market. But now Hyundai has

good market because of its models like

SANTRO, Accent etc..

Santro—second generation Hyundai

Atos, Accent—second generation

Hyundai Accent sedan, Sonata—sold

as the Sonata Embera, Verna—third

generation Hyundai Accent sedan,

Getz—sold as the Getz Prime, Elantra

—3rd generation Hyundai Elantra

sedan, Terracan (discontinued),

Tucson, i10—brand new small car,

global launch in India in 2007, and i20.

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Logan (in partnership with Mahindra &

Mahindra Limited).



Mercedes-Benz has had to cater to the

ever gowning luxury segment in India,

especially after the arrival of the other

luxury German manufacturers. Now,

Mercedes-Benz cars are launched in

India soon after the worldwide launch

and homologation as opposed to

earlier, when Mercedes-Benz had

monopolized the niche Indian market.

In 2007 they launched the SLK-Class

and CLS-Class.

C-Class, E-Class, S-Class, ML-Class,

SL-Class, CL-Class, SLK-Class, CLK-

Class, GL-Class, and CLS-Class.



Lancer - Sixth Generation Mitsubishi

Lancer, Cedia—seventh generation

Mitsubishi Lancer, Pajero—second

generation Mitsubishi Pajero, Montero

—third generation Mitsubishi Pajero,

and Outlander.


Škoda Auto is an important car

manufacturer of India. It recently

launched the Laura, the Octavia still

continues to exist. Škoda also offers

the Superb in India but it's not too


Fabia, Octavia/Laura, and Superb.

Toyota Toyota Kirloskar sells 4 car models in

India. It stopped producing the Toyota

Qualis to make way for the Toyota

Innova, which was launched in India in

Toyota Qualis, Camry—7th generation

Toyota Camry (the latest generation

Camry), Corolla—9th generation

Toyota Corolla, Innova, and Land

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2005. The most expensive car from

Toyota is the Land Cruiser Prado.

Toyota Kirloskar Motors Ltd. is a joint

venture between Toyota and the

Kirloskar Group.

Cruiser Prado VX—latest generation

Toyota Land Cruiser (PRADO).

The list of foreign cars sold in India as CBU is given below:

Audi: Audi A4, Audi R8, Audi A6, Audi A8, Audi TT, and Audi Q7.

BMW: BMW 7 Series, BMW X5, BMW X3, BMW M3, BMW M5, and BMW M6.

Land Rover: Range Rover and Range Rover Sport.

Nissan: Teana and X-Trail.

Porsche: Porsche 911, Porsche Boxster, Porsche Cayenne, and Porsche Cayman.

Rolls Royce: Rolls Royce Phantom.

Toyota: Land Cruiser Prado VX.

Volkswagen: Volkswagen Jetta, Volkswagen Passat, and Volkswagen Touareg.

Volvo: Volvo XC90 and Volvo S80.

Lamborghini: Lamborghini Gallardo and Lamborghini Murciélago


Under Rs. 3 Lakhs Maruti 800 , Alto, Omni, Reva, Nano

Rs. 3-5 Lakhs AmbassadorFiat Palio, Linea, Grand PuntoHyundai Santro , Getz, i-10,i-20Chevrolet Opel CorsaMaruti Zen-estilo , Wagon R, Versa, Esteem, Gypsy, Swift, A-Star, Ritz Ford Icon & FiestaTata Indica , Indigo XL, Indigo MarinaMahindra- Renault Logan,

Rs. 5-10 Lakhs Chevrolet Swing, Optra Magnum, TaveraHyundai Accent, ElantraMahindra ScorpioMaruti BalenoToyota InnovaTata SafariMitsubishi Lancer , Mitsubishi CediaHonda City ZXHonda jazz

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Mahindra BoleroMaruti SX4, Dezire

Rs. 10-15 Lakhs Toyota Corolla AltisFord Mondeo & EndeavourChevrolet ForesterSkoda Octavia & Combi, LauraHonda CivicHyundai Sonata Embera

Rs. 15-30 Lakh Honda CR-VMaruti Suzuki Grand VitaraTerracan TucsonMitsubishi PajeroMitsubishi OutlanderMitsubishi CediaAudi A4Opel VectraHonda AccordMercedes C ClassToyota CamryToyota Prius

Above Rs. 1 Cr ore Bentley Arnage, Bentley Continental GT & Flying SpurRolls Royce PhantomMaybachAudi R8


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1.3.8 Production facilities in India

Ashok Leyland: Ennore, Chennai, Tamil Nadu; Hosur, Tamil Nadu (3 plants)

Audi: Aurangabad, Maharashtra

BMW: Chennai, Tamil Nadu.

Bajaj Auto Ltd: Akurdi, MIDC Pimpri-Chinchwad, Pune, Maharashtra

Caparo: Chennai, Tamil Nadu.

Chevrolet: Halol, Gujrat.

Daimler : Chennai, Tamil Nadu.

Fiat: Pune (Ranjangaon), Maharashtra.

Ford: Chennai, Tamil Nadu.

Force Motors: Pune, Maharashtra

General Motors: Talegaon Dabhade (Pune), Maharashtra

Hindustan motors: Chennai, Tamilnadu, and Kolkata, West Bengal.

Honda: Greater Noida, Uttar Pradesh.

Hyundai: Chennai, Tamil Nadu.

Kinetic Motor Company Limited: M.I.D.C., Pimpri-Chinchwad Pune, Maharashtra

Mahindra: Nashik, Maharashtra; Kandivali, Maharashtra; Igatpuri, Maharashtra;

Zahirabad, Andhra Pradesh; and Haridwar, Uttarakhand.

Mercedes-Benz: Pune, Maharashtra.

Mitsubishi: Thiruvallur, Chennai, Tamil Nadu.

Renault-Nissan: Chennai, Tamil Nadu.

Škoda: Aurangabad, Maharashtra

Suzuki: Gurgaon, Haryana, and Manesar, Haryana.

TAFE Tractors : Chennai, Tamil Nadu.

Tata: Lucknow, Uttar Pradesh; Pimpri-Chinchwad (Pune) Maharashtra; Jamshedpur,

Jharkhand; Haridwar, Uttarakhand and Sanand, Gujarat.

TVS_Motors, Chennai, Tamil Nadu.

Toyota: Bangalore, Karnataka.

Volkswagen: Talegaon Dabhade (Pune), Maharashtra

Volvo Trucks: Bangalore, Karnataka

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1.4 Midsize Cars industry

Midsize cars industry provides an affordable automobile option for a family. Over the year,

sales performance of midsize cars in US and other countries has been quite impressive.

Many of the popular automobile manufacturers produce and sell midsized cars. Big names

in this industry include Honda, Chevrolet, Subaru, Pontiac, and Toyota. Midsized cars

manufactured by these automobile companies are some of the top sellers.

1.4.1 Midsize cars industry in US

High fuel prices have made car buyers to look towards fuel efficient cars in US. Popular car

maker in US have observed a buying pattern changes. Sales figures for June 2008 indicate

that demand for midsized cars in US has shot up significantly. But supply of midsized cars

is a bit on the lower side.

Auto buyers are being driven towards fuel efficient vehicles that cost between $18,000 and

$30,000. Low performance of US auto industry in 2008 has not affected midsize cars


1.4.2 Popular midsize cars in US

Chevrolet Malibu sedan, Honda Accord sedan, Chevrolet Equinox crossover, Subaru

Forester crossover, and Pontiac G6 sedan recorded improved sales for June 2008 over

previous year figures. Sale of Chevrolet Malibu sedan went up by 73.4 percent. Honda

Accord sedan recorded an improved sales performance of 54 percent. Chevrolet Equinox

crossover sales figure saw an increase of 45.9 percent.

1.4.3 Midsize car industry in India

Midsize car market in India was considered to be the next big thing for automotive industry.

But recent sales performance of midsize cars in India has been anything but great.

Negative growth rate has been recorded by most midsize cars, excluding Suzuki Dzire and

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Tata Indigo CS. Experts believe that rise in excise duty and fuel prices have caused a dip in

sales of midsize cars in India.

During April-June 2008, 15,766 units of Suzuki Dzire have been sold off. But Tata Indigo

CS emerged the winner with sale of 17,539 units. Chevy Optra, Skoda Octavia, and

Hyundai Accent were other decent performers.

Wednesday, 6 May 2009

Luxury and Mid-Size Cars will be Cheaper

All prospective car buyers can now think for luxury and mid-size cars as these segments is

likely to see a price slash. It is said that popular sedans like the Maruti SX4, the Honda

Civic and luxury car may become cheaper by up to Rs 50,000.

Nothing is confirmed but the ministry of heavy industries and finance ministry is on

discussion to waive off the specific excise duty charged on mid-size and top-end cars last


Cars with engine sized between 1,500-2,000cc were forced to pay an additional tax of Rs

15,000, whereas it was Rs 20,000 on all vehicles above 2,000cc engine. But as the tax was

forced on ex-factory price of vehicles, the car manufacturers transferred the burden to the

consumers with sales tax and other taxes. Now it is realized that such kind of tax planning

does not make any sense and is unfair for some car segments.

Because of such tax structure even the sales were affected as it discouraged the

consumers from buying cars like the Honda Civic and the Toyota Corolla. After the

implication of the light tax structure, the price on these cars will come down by Rs 20,000 to

Rs 50,000.

If this rule is put into practice, it will be a great offering for the buyer as well as the car

manufacturers. It will attract more buyers that will in turn help the car industry to revive.

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Introduction to the Organization

Maruti Suzuki

2.1 Maruti Suzuki India Ltd

Maruti Suzuki India Ltd Is a publicly listed automaker in India. It is a leading four-wheeler

automobile manufacturer in South Asia. Suzuki Motor Corporation of Japan holds a majority

stake in the company. It was the first company in India to mass-produce and sell more than

a million cars. It is largely credited for having brought in an automobile revolution to India. It

is the market leader in India and on 17 September 2007, Maruti Udyog was renamed

Maruti Suzuki India Limited. The company's headquarters are in Gurgaon, Haryana (near




Founded 1981 [1]

Headquarters Gurgaon, Haryana, India

Key peopleMr. Shinzo Nakanishi,

Managing Director and CEO

Industry Automotive

Products Cars

Revenue ▲US$3.5 billion (2009)

Employees 6,903 [2]

Parent Suzuki

Website MarutiSuzuki.com

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2.2 Maruti’s Board of Directors

Chairman Mr. R. C. Bhargava

Managing Director and


Mr. Shinzo Nakanishi

Director Mr. Manvinder Singh Banga

Director Mr. Amal Ganguli

Director Mr. D. S. Brar

Director Mr. Keiichi Asai

Director Mr. Osamu Suzuki

Director Mr. Shuji Oishi

Director Ms. Pallavi Shroff

Director Mr. Kenichi Ayukawa

Director and Managing

Executive Officer


Mr. Tsuneo Ohashi

Maruti Suzuki is one of India's leading automobile manufacturers and the market leader in

the car segment, both in terms of volume of vehicles sold and revenue earned. Until

recently, 18.28% of the company was owned by the Indian government, and 54.2% by

Suzuki of Japan. The Indian government held an initial public offering of 25% of the

company in June 2003. As of May 10, 2007, Govt. of India sold its complete share to Indian

financial institutions. With this, Govt. of India no longer has stake in Maruti Udyog.

Maruti Udyog Limited (MUL) was established in February 1981, though the actual

production commenced in 1983 with the Maruti 800, based on the Suzuki Alto kei car which

at the time was the only modern car available in India, its' only competitors- the Hindustan

Ambassador and Premier Padmini were both around 25 years out of date at that point.

Through 2004, Maruti has produced over 5 Million vehicles. Marutis are sold in India and

various several other countries, depending upon export orders. Cars similar to Marutis (but

not manufactured by Maruti Udyog) are sold by Suzuki and manufactured in Pakistan and

other South Asian countries.

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The company annually exports more than 50,000 cars and has an extremely large domestic

market in India selling over 730,000 cars annually. Maruti 800, till 2004, was the India's

largest selling compact car ever since it was launched in 1983. More than a million units of

this car have been sold worldwide so far. Currently, Maruti Alto tops the sales charts and

Maruti Swift is the largest selling in A2 segment.

Due to the large number of Maruti 800s sold in the Indian market, the term "Maruti" is

commonly used to refer to this compact car model. Till recently the term "Maruti", in popular

Indian culture, was associated to the Maruti 800 model.

Maruti Suzuki India Limited, a subsidiary of Suzuki Motor Corporation of Japan, has been

the leader of the Indian car market for over two decades.

It’s manufacturing facilities are located at two facilities Gurgaon and Manesar south of New

Delhi. Maruti’s Gurgaon facility has an installed capacity of 350,000 units per annum. The

Manesar facilities, launched in February 2007 comprise a vehicle assembly plant with a

capacity of 100,000 units per year and a Diesel Engine plant with an annual capacity of

100,000 engines and transmissions. Manesar and Gurgaon facilities have a combined

capability to produce over 700,000 units annually.

More than half the cars sold in India are Maruti cars. The company is a subsidiary of Suzuki

Motor Corporation, Japan, which owns 54.2 per cent of Maruti. The rest is owned by the

public and financial institutions. It is listed on the Bombay Stock Exchange and National

Stock Exchange in India.

During 2007-08, Maruti Suzuki sold 764,842 cars, of which 53,024 were exported. In all,

over six million Maruti cars are on Indian roads since the first car was rolled out on

December 14, 1983.

Maruti Suzuki offers 12 models, Maruti 800, Omni, Alto, Versa, Gypsy, A Star, Wagon R,

Zen Estilo, Swift, Swift Dzire, SX4, Grand Vitara. Swift, Swift dzire, A star and SX4 are

maufactured in Manesar, Grand Vitara is imported from Japan as a completely built unit

(CBU), remaining all models are manufactured in Maruti Suzuki's Gurgaon Plant.

Suzuki Motor Corporation, the parent company, is a global leader in mini and compact cars

for three decades. Suzuki’s technical superiority lies in its ability to pack power and

performance into a compact, lightweight engine that is clean and fuel efficient.

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Maruti is clearly an “employer of choice” for automotive engineers and young managers

from across the country. Nearly 75,000 people are employed directly by Maruti and its


The company vouches for customer satisfaction. For its sincere efforts it has been rated (by

customers)first in customer satisfaction among all car makers in India for nine years in a

row in annual survey by J D Power Asia Pacific.

Maruti Suzuki was born as a government company, with Suzuki as a minor partner to make

a people's car for middle class India. Over the years, the product range has widened,

ownership has changed hands and the customer has evolved. What remains unchanged,

then and now, is Maruti’s mission to motorize India.

2.2 Core value

- Customer obsession

- Fast, Flexible & First Mover

- Innovation & creativity

- Networking & Partnership

- Openness & Learning

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2.3 Partner for the joint venture

Pressure started mounting on Indira and

Sanjay Gandhi to share the details of the

progress on the Maruti Project.

Since country's resources were made

available by mother to her son's pet project.

A delegation of Indian technocrats was

assigned to hunt a collaborator for the project.

Initial rounds of discussion were held with the giants of the automobile industry in Japan

including Toyota, Nissan and Honda. Suzuki Motor Corporation was at that time a small

player in the four wheeler automobile sector and had major share in the two wheeler

segment. Suzuki's bid was considered negligible.

In the initial rounds of discussion the giants had their bosses present and in the later rounds

related to the technical discussions executives of these automobile giants were present.

Osamu Suzuki, Chairman and CEO of the company ensured that he was present in all the

rounds of discussion. Osamu in an article writes that it subtly massaged their (Indian

delegation) egos and also convinced them about the sincerity of Suzuki's bid. In the initial

days Suzuki took all steps to ensure the government about its sincerity on the project.

Suzuki in return received a lot of help from the government in such matters as import

clearances for manufacturing equipment (against the wishes of the Indian machine tool

industry then and its own socialistic ideology), land purchase at government prices for

setting up the factory Gurgaon and reduced or removal of excise tariffs. This helped Suzuki

conscientiously nurse Maruti through its infancy to become one of its flagship ventures.[3]

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2.5 Joint venture related issues

Maruti Suzuki's A-Star vehicle during its unveiling in Pragati Maidan, Delhi. A-Star, Suzuki's

fifth global car model, was designed and is made only in India. [4] Besides being Suzuki's

largest subsidiary in terms of car sales, Maruti Suzuki is also Suzuki's leading research and

development arm outside Japan

Relationship between the Government of India, under the United Front (India) coalition and

Suzuki Motor Corporation over the joint venture was a point of heated debate in the Indian

media till Suzuki Motor Corporation gained the controlling stake. This highly profitable joint

venture that had a near monopolistic trade in the Indian automobile market and the nature

of the partnership built up till then was the underlying reason for most issues. The success

of the joint venture led Suzuki to increase its equity from 26% to 40% in 1987, and further to

50% in 1992. In 1982 both the venture partners had entered into an agreement to nominate

their candidate for the post of Managing Director and every Managing Director will have a

tenure of five years[5]

Initially R.C.Bhargava, was the managing director of the company since the inception of the

joint venture. Till today he is regarded as instrumental for the success of Maruti Udyog.

Joining in 1982 he held several key positions in the company before heading the company

as Managing Director. Currently he is on the Board of Directors.[6] After completing his five

year tenure, Mr. Bhargava later assumed the office of Part-Time Chairman. The

Government nominated Mr. S.S.L.N. Bhaskarudu as the Managing Director on August 27,

1997. Mr. Bhaskarudu had joined Maruti in 1983 after spending 21 years in the Public

sector undertaking Bharat Heavy Electricals Limited as General Manager. Later in 1987 he

was promoted as Chief General Manager, 1998 as Director, Productions and Projects,

1989 Director, Materials and in 1993 as Joint Managing Director.

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The Suzuki Motor corporation didn't attend the Annual General Meeting of the Board with

the reason of it being called on a short notice.[7] Later Suzuki Motor Corporation went on

record to state that Mr. Bhaskarudu was "incompetent" and wanted someone else.

However, the Ministry of Industries, Government of India refuted the charges. Media stated

from the Maruti sources that Bhaskarudu was interested to indigenise most of components

for the models including gear boxes especially for Maruti 800. Suzuki also felt that

Bhaskarudu was a proxy for the Government and would not let it increase its stake in the

venture.[8] If Maruti would have been able to indigenise gear boxes then Maruti would have

been able to manufacture all the models without the technical assistance from Suzuki. Till

today the issue of localization of gear boxes is highlighted in the press.[9]

The relation strained when Suzuki Motor Corporation moved to Delhi High Court to bring a

stay order against the appointment of Mr. Bhaskarudu. The issue was resolved in an out-of-

court settlement and both the parties agreed that R S S L N Bhaskarudu would serve up to

December 31, 1999, and from January 1, 2000, Jagdish Khattar, Executive Director of

Maruti Udyog Limited would assume charges as the Managing Director.[10] Many politicians

believed, and had stated in parliament that the Suzuki Motor Corporation is unwilling to

localize manufacturing and reduce imports. This remains true, even today the gear boxes

are still imported from Japan and are assembled at the Gurgaon facility.

2.6 Industrial relations

For most of its history, Maruti Udyog had relatively few problems with its labour force. Its

emphasis of a Japanese work culture and the modern manufacturing process, first

instituted in Japan in the 1970s, was accepted by the workforce of the company without any

difficulty. But with the change in management in 1997, when it became predominantly

government controlled for a while, and the conflict between the United Front Government

and Suzuki may have been the cause of unrest among employees. A major row broke out

in September 2000 when employees of Maruti Udyog Ltd (MUL) went on an indefinite

strike, demanding among other things, revision of the incentive scheme offered and

implementation of a pension scheme. Employees struck work for six hours in October 2000,

irked over the suspension of nine employees, going on a six-hour tools-down strike at its

Gurgaon plant, demanding revision of the incentive-linked pay and threatened to fast to

death if the suspended employees were not reinstated. About this time, the NDA

government, following a disinvestments policy, proposed to sell part of its stake in Maruti in

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a public offering. The Staff union opposed this sell-off plan on the grounds that the

company will lose a major business advantage of being subsidised by the Government.

The standoff with the management continued to December with a proposal by the

management to end the two-month long agitation rejected with a demand for reinstatement

of 92 dismissed workers, with four MUL employees going on a fast-unto-death. In

December the company's shareholders met in New Delhi in an AGM that lasted 30 minutes.

At the same time around 1500 plant workers from the MUL's Gurgaon facility were agitating

outside the company's corporate office demanding commencement of production linked

incentives, a better pension scheme and other benefits. The management has refused to

pass on the benefits citing increased competition and lower margins.[11]

2.7 Launches of Maruti Suzuki’s various model

1. Maruti 800: Launched - 1983

2. Maruti Omni: Launched - 1984

3. Maruti Gypsy: Launched - 1985

4. Maruti Alto: Launched - 2000

5. Maruti Wagon-R: Launched - 2002

6. Maruti Versa: Launched - 2003

7. Maruti Grand Vitara Launched - 2004

8. Maruti Suzuki Swift: Launched - 2005

9. Maruti Zen Estilo: Launched - 2006

10.Maruti Suzuki SX4: Launched - 2007

11.Maruti Swift Dzire: Launched - 2008

12.Maruti A-Star: Launched - 2008

13.Maruti Suzuki Ritz: Launched - 2009

Authorized service stations

Maruti is one of the companies in India which has unparalleled service network. To ensure

the vehicles sold by them are serviced properly, Maruti has 2628 listed Authorized service

stations and 30 Express Service Stations on 30 highways across India.

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Service is a major revenue generator of the company. Most of the service stations are

managed on franchise basis, where Maruti trains the local staff. Other automobile

companies have not been able to match this benchmark set by Maruti. The Express Service

stations help many stranded vehicles on the highways by sending across their repair man

to the vehicle.[12]

2.8 Maruti insurance

Launched in 2002 Maruti provides vehicle insurance to its customers with the help of the

National Insurance Company, Bajaj Allianz, New India Assurance and Royal Sundaram.

The service was set up the company with the inception of two subsidiaries Maruti Insurance

Distributors Services Pvt. Ltd and Maruti Insurance Brokers Pvt. Limited[13]

This service started as a benefit or value addition to customers and was able to ramp up

easily. By December 2005 they were able to sell more than two million insurance policies

since its inception.[14]

2.9 Maruti Finance

To promote its bottom line growth, Maruti launched Maruti Finance in January 2002. Prior to

the start of this service Maruti had started two joint ventures Citicorp Maruti and Maruti

Countrywide with Citi Group and GE Countrywide respectively to assist its client in securing

loan.[15] Maruti tied up with ABN Amro Bank, HDFC Bank, ICICI Limited, Kotak Mahindra,

Standard Chartered Bank, and Sundaram to start this venture including its strategic

partners in car finance. Again the company entered into a strategic partnership with SBI in

March 2003[16] Since March 2003, Maruti has sold over 12,000 vehicles through SBI-Maruti

Finance. SBI-Maruti Finance is currently available in 166 cities across India.[17]

"Maruti Finance marks the coming together of the biggest players in the car finance

business. They are the benchmarks in quality and efficiency. Combined with Maruti

volumes and networked dealerships, this will enable Maruti Finance to offer superior

service and competitive rates in the marketplace".

— Jagdish Khattar, Managing director of Maruti Udyog Limited in a press conference

announcing the launch of Maruti Finance on January 7, 2002[19]

Citicorp Maruti Finance Limited is a joint venture between Citicorp Finance India and Maruti

Udyog Limited its primary business stated by the company is "hire-purchase financing of

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Maruti vehicles". Citi Finance India Limited is a wholly owned subsidiary of Citibank

Overseas Investment Corporation, Delaware, which in turn is a 100% wholly owned

subsidiary of Citibank N.A. Citi Finance India Limited holds 74% of the stake and Maruti

Udyog holds the remaining 26%.[20] GE Capital, HDFC and Maruti Udyog Limited came

together in 1995 to form Maruti Countrywide.[21] Maruti claims that its finance program offers

most competitive interest rates to its customers, which are lower by 0.25% to 0.5% from the

market rates.

Maruti TrueValue

Maruti True service offered by Maruti Udyog to its customers. It is a market place for used

Maruti Vehicles. One can buy, sell or exchange used Maruti vehicles with the help of this

service in India.[22]

N2N Fleet Management

N2N is the short form of End to End Fleet Management and provides lease and fleet

management solution to corporates. Its impressive list of clients who have signed up of this

service include Gas Authority of India Ltd, DuPont, Reckitt Benckiser, Sona Steering,

Doordarshan, Singer India, National Stock Exchange and Transworld. This fleet

management service include end-to-end solutions across the vehicle's life, which includes

Leasing, Maintenance, Convenience services and Remarketing.[23]

2.10 Accessories

Many of the auto component companies other than Maruti Udyog started to offer

components and accessories that were compatible. This caused a serious threat and loss

of revenue to Maruti. Maruti started a new initiative under the brand name Maruti Genuine

Accessories to offer accessories like alloy wheels, body cover, carpets, door visors, fog

lamps, stereo systems, seat covers and other car care products. These products are sold

through dealer outlets and authorized service stations throughout India.[24]

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2.11 Maruti Driving School

A Maruti Driving School in Chennai

As part of its corporate social responsibility Maruti Udyog launched the Maruti Driving

School in Delhi. Later the services were extended to other cities of India as well. These

schools are modelled on international standards, where learners go through classroom and

practical sessions. Many international practices like road behaviour and attitudes are also

taught in these schools. Before driving actual vehicles participants are trained on


"We are very concerned about mounting deaths on Indian roads. These can be brought

down if government, industry and the voluntary sector work together in an integrated

manner. But we felt that Maruti should first do something in this regard and hence this

initiative of Maruti Driving Schools."

— Jagdish Khattar, at the launch ceremony of Maruti Driving School, Bangalore

Road safety is a key concern area for both the Government and the people on Indian roads.

Safe driving today requires a higher level of confidence and competence, given the poor

traffic planning, increasing number of vehicles, lack of professionalism in driving and

untrained drivers on road. In a bid to address these issues, Maruti Suzuki India Ltd. has

launched Maruti Driving School — its initiative for promoting safe driving.

MDS not just imparts better driving skills but also tries to inculcate safe driving culture

through special theoretical sessions for behavioural training and road sense. The school

was the first to introduce advanced driving training simulator for better judgment and

concept of route maps for holistic on-road practice.

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Having started from Bangalore in March 2005, Maruti Driving School has now spread its

network throughout the country. It is dedicated towards making Indian roads safer by

helping learners become smart and responsible motorists.

The salient features of MDS include:

1. Training imparted by instructors who are trained at IDTR. The certification of  

Instructors comes after a tough evaluation process.  MDS has specially appointed

lady instructors for the benefit   and   comfort    of     women    trainees.

2. A curriculum that comprises comprehensive theory and practical sessions. The

theoretical component focuses extensively on attitudinal and behavioural training

and deals with the problem of road rage.

3. Use of advanced passenger car simulators for imparting driving training. The

simulator familiarizes the trainee with car controls, before the trainee actually takes

the car on road. It also simulates a variety of conditions such as night driving, hill

driving, road and light conditions.

Practical training provided on new cars fitted with dual control for enhanced safety and air-

conditioning for comfortable learning.

2.12 Exports

Maruti Suzuki has helped India emerge as the fourth largest exporter of automobiles in

Asia. Shown here is Maruti Gypsy in Malta.

Maruti Exports Limited is the subsidiary of Maruti Udyog Limited with its major focus on

exports and it does not operate in the domestic Indian market. The first commercial

consignment of 480 cars were sent to Hungary. By sending a consignment of 571 cars to

the same country Maruti crossed the benchmark of 300,000 cars. Since its inception export

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was one of the aspects government was keen to encourage. Every political party expected

Maruti to earn foreign currency.

Angola, Benin, Djibouti, Ethiopia, Europe, Kenya, Morocco, Sri Lanka, Uganda, Chile,

Guatemala, Costa Rica and El Salvador are some of the markets served by Maruti Exports

2.13 Some Key Areas:

Customer DelightIn these competitive times the challenge is to keep inventing newer ways of doing things to keep the customers in your fold.

Over the last few years ,the company strengthened the existing Practices and experimented with many new initiatives by way of kaizens (continuous improvements) to delight its customers.

These initiatives ranged from product design and quality to network expansion, and included new service programs to meet unsaid needs of customers.


The company has retained its competitive edge by offering high quality products. In the field, the products are supported by rapidly expanding networks. The company has diverse neworks for new cars, spares, service, pre owned cars and so on, and all of them were in expansionmode last year to enable the company get closer to the customer.

Servicing customers 24X7..... 365 days....

The company takes great pride in sharing that customers have rated Maruti Suzuki first once again in Customer Satisfaction Survey conducted by independent body, J.D.Power Asia Pacific. It is 9thtime in a row.

The award mirrors the company's commitment towards "Customer Obsession".

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Key Initiatives

Car pickup & delivery facility for women car owners

Quote Unquote: "The study finds that vehicle pickup and delivery before and after service has a Strong impact on customer satisfaction. In particular, customers who say that their vehicle was picked up from their doorstep before service and delivered to the same point after service are notably more delighted with their after-sales service experience, compared with customers whodo not receive this service...."

Setting up "Express Service Bays" & "2 - Technician Bays"

As the name suggests the company set out to delight its customers byoffering them faster car service by introducing new concepts such asExpress Service Bays & 2- Technicians Bays

These are done for customers who are hard pressed for time.Both the initiatives undertaken in this direction, have helped improve customer interface and also helped increase the productivity and capacity of existing workshops.


Mega Camps


The company aggressively conducts 'Mega Camps' throughout the country round the year.

Activities undertaken during a mega camp include complimentary car wash, AC & Pollution check up, oil and fuel top ups, wheel alignments etc.

Apart from mega camps workshop camps like A/C checkup camps, PUC and general check-up camps, Locality camps , Pre monsoon camps etc are also regularly conducted as part of customer connect initiatives.

Service at your Door Step through Maruti Mobile Support

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Another unique initiative is the door step service facility through Maruti Mobile Support.

Maruti Mobile Support is a first of it's kind initiative and is expected not only to help the company reach out customers in metro cities but also as a mean to reach semi urban /rural areas where Setting up of new workshop may not be viable.

Car Safety device: Immobilizer


The company used technology to meet customer needs and even delight them. Following feedback that the company's cars were moreprone to theft owing to their resale value, the company worked on an anti-theft immobilizer or "I-Cats;" system for all its new cars.

Complete car needs

The company's effort of providing all car-related needs -- from learning to drive a car at Maruti Driving Schools to car insurance, extended warranty and eventually exchanging the existing car for a new one --  under one roof at dealerships also enhances customer satisfaction

We were born as a government company, with Suzuki as a minor partner, to make a people's car for middle class India. Over the years, our product range has widened, ownership has changed hands and the customer has evolved. What remains unchanged, then and now, is our mission to motorise India.


 Our parent company, Suzuki Motor Corporation, has been a global leader in mini and compact carsfor three decades. Suzuki's technical superiority lies in its ability to pack power and performance into a compact, light-weight engine that is clean and fuel efficient. The same characteristics make our cars extremely relevant to Indian customers and Indian conditions.Product quality, safety and cost consciousness are embedded into our manufacturing process, whichwe have inherited from our parent company.

Right from inception, Maruti brought to India, a very simple yet powerful Japanese philosophy 'smaller,fewer, lighter, shorter and neater

From the Japanese work culture we imbibed simple practices like an open office, a common uniform and common canteen for everyone from the Managing Director to the workman, daily morning exercise,and quality circle teams. 

Maruti Suzuki Today

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More than half the number of cars sold in India wear a Maruti Suzuki badge.    It is a subsidiary of Suzuki Motor Corporation Japan.They offer full range of cars- from entry level Maruti 800 & Alto to stylish hatchback Ritz, A star, Swift, Wagon R, Estillo and sedans DZire, SX4 and Sports Utility vehicle Grand Vitara.

Since inception, we have produced and sold over 7.5 million vehicles in India and exported over 500,000 units to Europe and other countries.

Our turnover for the fiscal 2008-09 stood at Rs. 203,583 Million & Profit After Tax at Rs. 12,187 Million. 


Sustainability at Maruti Suzuki refers to sum total of all the actions and initiatives undertaken by the company for its long-term survival and growth.

To achieve long-term sustainability and prosperity the company has nurtured a socially responsible behaviour towards its various stakeholders.

Since inception, the company has proactively taken care of the needs and sustainable growth of its stakeholders and they in turn, have supported the company in achieving its vision and business results year after year. As a result, sustainability has become an integral part of the company's approach to business and decision making


While working to enhance shareholder wealth, Maruti Suzuki will regularly engage with all

stakeholders to assess their needs and through its products, services, conduct and

management initiatives, promote their sustained growth and well – being.

Policy Guidelines


Company will follow responsible business practices in all its functions and operations and

will strive to implement them at its suppliers, dealers and other business partners.



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Company will continue to remain ahead of law in pursuit of environment protection and

energy  conservation at its manufacturing facilities, and in development of products that

use fewer natural resources and are environment friendly.


Company will be deeply committed towards the welfare of its employees, their families

and communities around its operations to improve quality of life as a whole.


Company will develop products and services that fulfills the aspirations of customers,

build a strong and lasting bond with them, proactively support them during natural

calamities, delight them with after sales services and availability of spares.


Company will continue to provide technological and managerial support to its suppliers

and dealers to further their profitable and sustainable growth.


As an expression of thanks to the local community and the people of the country

Company will undertake initiatives that might not be directly linked to its business.


Company will partner with government, NGOs, business partners to contribute positively

towards economic and human development of the society especially underprivileged



Company will encourage and recognize its employees for volunteering in the community

in the spirit of serving and sharing their expertise and skills.


Company will strive to constantly build organizational capabilities, like any other

competency, position suitable people and have a proper organizational structure to

ensure implementation of CSR policy, guidelines and programs.


Company will engage with reputed external agencies for audit of its CSR activities for the

purpose of  identifying areas of improvement, authenticity of data and reporting.


Company will monitor the progress on various CSR programs in a structured manner,

document the performance against the set targets and publish a report every year on its

CSR performance and share with its key stakeholders

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2.14 Facilities 

Maruti Suzuki has two state-of-the-art manufacturing facilities in India. The first facility is at Gurgaon spread over 300 acres and the other facility is at Manesar, spread over 600 acres in North India.

 The Gurgaon facility  





Maruti Suzuki's facility in Gurgoan houses three fully integrated plants. While the three plants have a total installed capacity of 350,000 cars per year, several productivity improvements or shop floor Kaizens over the years have enabled the company to manufacture nearly 700,000 cars/ annum at the Gurgaon facilities.

The entire facility is equipped with more than 150 robots, out of which 71 have been developed in-house. More than 50 per cent of our shop floor employees have been trained in Japan.Gurgaon facility also houses `K' Engine plant. 




The `K' family engine plant has an installed annual capacity of 240,000 engines and was commissioned in 2008. Spread over an area of 20,300 m2, the `K' family engine facility is part of the Rs 9,000 crore investment plan drawn by Maruti Suzuki and Suzuki Motor Corporation.

The next generation `K 'engine like all Maruti Suzuki earlier technologies is highly fuel efficient, while offering the best in refinement and performance.

It will take the engine technology to the next level in India. A-Star is the first car to be powered by `K' family engine. The forthcoming models will be powered by other `K' family engines.




The in-line plant layout consisting of Casting, Machining and Assembly processes has high level of automation, effective material handling and inventory reduction techniques in place, aimed forhigh operational efficiency.

The facility employs global manufacturing best practices like cold testing, 100% on line automated checks to ensure global quality.




The Manesar facility



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Manesar facility has been made to suit Suzuki Motor Corporation (SMC) and Maruti Suzuki India Limited's (MSIL) global ambitions.

The plant was inaugurated in February 2007.

At present the plant rolls out World Strategic Models Swift , A-star & SX4 and DZire.The plant has several in-built systems and mechanisms.

There is a high degree of automation and robotic control in the press shop, weld shop and paint shop to carry on manufacturing work with acute precision and high quality.

The plant is designed to be flexible: diverse car models can be made here conveniently owing to automatic tool changers, centralized weld



 control system and numerical control machines that ensure high quality.      

 The plant at Manesar is the company's fourth car assembly plant and started with an initial capacity of 100,000 cars per year. This will be scaled up to 300,000 cars per year by October 2008.



 Diesel Engine Plant- Suzuki Powertrain India Limited  


Suzuki Powertrain India Limited the diesel engine plant at Manesar is SMC's & Maruti's first and perhaps the only plant designed to produce world class diesel engine and transmissions for cars. The plant is under a joint venture company, called Suzuki Powertrain India Limited (SPIL) in which SMC holds 70 per cent equity the rest is held by MSIL.

This facility has an initial capacity to manufacture 100,000 diesel engines a year. This will be scaled up to 300,000 engines/annum by 2010.

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2.15 Current models of Maruti Suzuki

 Model : 800 AC BS-III  Model : 800 Duo AC


 Model : 800 Duo Std  Model : 800 Std BS-III

 Model : A-Star LXI  Model : A-Star VXI

 Model : A-Star ZXI  Model : Alto BS-III

 Model : Alto Lx BS-III  Model : Alto Lxi BS-III

 Model : Grand Vitara AT  Model : Grand Vitara MT

Model: Gypsy King HT  Model : Gypsy King ST BS-III

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 Model : Omni (5-seater) BS-III  Model : Omni (8-seater) BS-III

 Model : Omni Ambulance BS-III  Model : Omni Cargo BS-III

 Model : Omni Cargo-LPG  Model : Omni LPG

 Model : Ritz Ldi  Model : Ritz Lxi

 Model : Ritz Vdi  Model : Ritz Vxi

 Model : Ritz Zxi  Model : Swift Dzire Ldi Diesel

Model : Swift Dzire Lxi Petrol Model : Swift Dzire Vdi Diesel

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 Model : Swift Dzire Vxi Petrol  Model : Swift Dzire Zdi Diesel

 Model : Swift Dzire Zxi Petrol  Model : Swift LDi

 Model : Swift Lxi  Model : Swift VDi

 Model : Swift Vxi  Model : Swift Vxi (ABS)

 Model : Swift Zxi  Model : SX4 Vxi

 Model : SX4 Zxi  Model : Versa BS-III

 Model : Versa DX (5 Seater) BS-III  Model : Versa DX (8 Seater) BS-III

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Discontinued MARUTI SUZUKI INDIA LTD Models  

  800  |   Alto  |   Baleno  |   Esteem  |   Grand Vitara  |   Gypsy  |   Omni  |   Versa  |  

WagonR  |   Zen  |

scontinued MARUTI SUZUKI INDIA LTD Models and Variants  

Model : 800 AC BS-II Model : 800 Std BS-II

Model : Alto BS-II Model : Alto Lx BS-II

Model : Alto Lxi BS-II Model : Baleno Altura

Model : Baleno Lxi BS-II Model : Baleno Lxi BS-III

Model : Baleno Vxi BS-II Model : Baleno Vxi BS-III

Model : Esteem D Model : Esteem Di

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Model : Esteem Lx BS-II Model : Esteem Lx BS-III

Model : Esteem Lxi BS-II Model : Esteem Lxi BS-III

Model : Esteem Vxi BS-II Model : Esteem Vxi BS-III

Model : Grand Vitara XL7 Model : Gypsy King HT BS-II

Model : Gypsy King ST BS-II Model : Omni (5-seater) BS-II

Model : Omni (5-seater) CNG Model : Omni (8-seater) BS-II

Model : Omni Ambulance BS-II Model : Omni Cargo BS-II

Model : Versa DX (5-seater) BS-II Model : Versa DX 2 BS-II

Page 48: consumer behaviour.docx

Men are Back

In an attempt to strengthen its position in the of Sedan cars market, Maruti Udyog Ltd. has

launched its premium model bearing name SX4. After Maruti Suzuki Swift, SX4 is the

second international model being launched in India. Suzuki SX4, is an A3 segment sedan

car, with a perfect combination of style, performance, safety and comfort. There are two

versions of Suzuki SX4: Vxi and Zxi that gets power from latest and efficient 1.6-litre M-

Series engine delivering impressive 102 BHP of power.

Maruti Suzuki SX4 is packed with strong features like independent suspension system, Anti

Lock Braking System (ABS), matching color bumpers, electrically adjustable outside

mirrors, fine quality fabric seats, power windows, rear seat center armrest and adjustable

head rests in the front and rear seats are few to name for a smooth, comfortable and safe


Having the price tag of between Rs. 6-6.5 Lacs, Maruti Suzuki SX4 will provide tough

competition to its rivalry models like Ford Fiesta, Hyundai Verna, Honda City, and Indigo


Company Name Segment USP

Maruti Udyog Ltd. A3 Sedan Value for Money.

Key Features of Maruti Suzuki Sx4

Powered with 16 valve, 4 cylinder engine delivering impressive 143 horsepower, 136

ft lbs of torque.

15" large wheels and the arched bumpers adds grace to its athletic and robust


Power assisted rack and pinion steering.

All wheel drive system to have better riding comfort.

Standard MP3 ready stereo with 04 speakers and available iPod integration.

With 4,490 mm length and 1,735 mm width, the SX4 looks very grand.

Dashboard composed Music System with controls on Steering Wheel.

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An illuminated key insert switch is the unique features of this car.

The turning radius of 5.3 meters makes the SX4 easily driven car on narrow roads.

The SX4 comes with a unique anti theft device called The immobilizer.

Colors Available In Maruti Suzuki Sx4

Maruti Suzuki SX4 is available in 07 sparkling colors -

Midnight Black

Azure Gray

Silky Silver

Clear Beige

Sunlight Copper

Pearl Arctic White

Supreme Red

Price & Competition From Rivals

Maruti Suzuki SX4 has been priced between Rs. 6-6.5 Lacs, is in a tough competition from

its Ford Fiesta, Hyundai Verna, Honda City, and Indigo XL.

(Please Note: The prices are ex-showroom and based on the close approximation. Please

check the latest prices and variant specifications with your dealer)

Safety Features of Maruti Suzuki Sx4

Rear doors Child-lock.

Intelligent Computerised Anti-Theft System (iCATS) which prevents its engine from

running unless the correct key is present.

ABS, and Emergency Brake-force Distribution (EBD).

Enhanced safety through seat belt pre-tensioners and force limiters .

Accented seating position provides wider & better visibility.

Quote - Unquote

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"SX4 sedan is just the right car with which Maruti Udyog can reinforce its presence in the

A3 segment and enhance its leadership".

Speaking at the launch Mr. Jagdish Khattar, Managing Director & CEO, Maruti Suzuki India


Technical Specifications of Maruti Suzuki Sx4

Dimensions & Weight

Length (mm) 4490

Width (mm) 1735

Height (mm) 1560

Wheelbase (mm) 2500

Kerb Weight (kgs) 1170

Seating Capacity 05


Model Designation 1.6 L 16 V

No. Of Cylinders 04 Inline

Configuration DOHC

Displacement (cc) 1586

Transmission 5 Manual

Top Speed (kmph) 175

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FrontIndependent suspension with gas-filled McPherson strut & anti-

roll bar

Rear Semi independent torsion beam with gas filled shock absorbers


Type Disc

Front / Rear Brakes Ventilated Discs/ Drums


Type 195/65 R15

Wheels 15" Steel

Fuel Tank 50 Litres


Max. Horsepower

(ps/rpm)103 PS @ 5500 rpm

Max. Torque (kg m/rpm) 145 Nm @ 4200 rpm


Steering Type Rack & Pinion with Electronic Power Steering

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Maruti Suzuki wins CNBC Auto Car India Awards


Maruti Suzuki India Limited received the following awards yesterday at the award

ceremony in New Delhi on 9th January, 2008

TNS Voice of Customer Award : Maruti Suzuki Alto

CNBC-Autocar India Best Value For Money Car Award: Maruti Suzuki SX4

  CNBC-Autocar India Best Mid Size Car Award : Maruti Suzuki SX4

  CNBC-Autocar India Car of the Viewers' Choice Award : Maruti Suzuki SX4

 CNBC-Autocar India Manufacturer of the Year Award : Maruti Suzuki India Limited

Product detail

Page 53: consumer behaviour.docx

NEWS Published: May 20th, 2009

The new Maruti Suzuki has impressed everyone with its masculinity and attractive

features. The Maruti Suzuki SX4 is an A3 premium segment sedan that blends style,

comfort, performance, and safety. Launch of the Maruti Suzuki SX4 coincides with the

phasing-out of the Maruti Suzuki Baleno, which was launched in 1999 and could not see

great success. The SX4 is the second international offering from the house of Maruti

Suzuki, the first being the Swift. India is the first country to see the launch of the SX4, which

proves India’s worth as one of the hottest car-markets in the world.

Both, the Vxi and the Zxi variants are available in a host of Metallic colours such as Silky

Silver, Clear Beige, Midnight Black, Sunlight Copper, Pearl Arctic White, Supreme Red, and

Azure Grey.

Maruti Suzuki SX4 is an A3 segment sedan car. Launched in India by Maruti Udyog Ltd.,

the sedan comes across as a perfect blend of style, performance, safety, and comfort. The

combined efforts of Suzuki and Maruti that have gone into its manufacture have made SX4

popular amongst the car connoisseurs of India. Available in dazzling colors and two

variants, Maruti SX4 has almost bowled over the Indian buyers, who dream of owning a

luxurious car.

The SX4 is being touted as the tallest, widest, and broadest sedan in its class. It is available

in two variants, the Vxi and the Zxi. The SX4 boasts of various features which are available

only in cars that cost about a lakh more as compared to it. That is why the SX4 is expected

to give a tough competition to the Chevrolet Aveo, Ford Fiesta, Honda City, and Hyundai


Maruti SX4 is powered by 1.6 L 16-valve M-series engine that generates maximum power

of 87bhp @ 6000rpm and maximum torque of 145 Nm @ 4200 rpm. The 1298 cc engine is

equipped with MPFI ignition system. The suspensions, brakes, and transmissions were

regulated in Europe, with further fine-tuning done to suit the Indian roads.

Expert’s View about SX4

Autocar, Writes

"Suzuki's SX4 sedan made its world debut at Geneva. Like its five-door sibling, the new

model combines responsive dynamics, 4x4 capability and high levels of practicality with a

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comfortable and cosseting interior, Suzuki has used the talents of Italian designer Giugiaro,

who also helped design the SX4 crossover. The interiors are also very fresh and modern

with large and airy cabin."

Maruti SX4 - A Sedan that can surprise says S. Muralidhar (The Hindu Business Line)

Three world strategic models, as Suzuki calls them - the Swift, the new Grand Vitara and

the new SX4 - have all contributed to the resurgence of Suzuki image as a competitive

global manufacturer of attractive looking, quality cars in more segments than its traditional

stronghold of small hatches.

The SX4 sedan, like the Fiat and Suzuki hatchback counterparts, clearly attempts at

offering the sedan buyer the feel of premium ness and the performance of a bigger sedan

even as its is sharply focused at practicality.

Similarly, the overall dimensions of the SX4 have again been chosen

to offer more to the customer in this segment compared to the

competition in this price class. So, the SX4's wheelbase and width will

actually compare favorably to cars prices in the Rs. 10 lakh plus price

segment. Accentuating the look and feel of the SX4's size is the

strong raised shoulder line and the high ground clearance of 190mm. Flared wheel arches

attempt to distract the onlooker's attention from the large gaps between body panels and


At the rear, the tail-lamps dominate the stubby, nearly notch-back style boot lid. Reflectors

integrated into the rear bumper and a third stop lamp offer additional safety.

High-end safety features such as anti-lock brakes with electronic brake force distribution,

seat belt pre-tensioners and load limiters, and dual front airbags will be available as

standard only in the top-end ZXi variant.

But other features such as adjustable tilt steering, variable instrument cluster illumination,

tubeless tyres, in-dash digital time and temperature display, and rear glass-integrated

antenna are standard features in both the trim levels...

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Bijoy Kumar from Business Standard writes

Step into the SX4 and you are greeted by a very functional interior that has been

deliberately meddled with to grab your attention.

Two plasto-chrome strips line the centre console and there is a good sprinkling of the stuff

elsewhere too, adding to the "expensive and sporty" look. Dark dials and orange displays

according to me belonged to Audis of the nineties but do not look all that out of place in a

Suzuki sedan.

Look at the kit! The top-end City doesn't have any of the gizmo bits

thrown into the SX4 ZXi, and the latter costs way less. But the new

age construction of the Honda with tis petrol tank situated under the

front seat means rear passengers can fold their legs under the seat -

something you cannot do with the SX4.

Settle in the comfortable seat, adjust the mirrors, fire the motor and you are in for an

audible surprise. Unlike the previous Suzuki engines, this one makes its presence felt. You

can pick up the valve gear and other mechanical noises.

The new 16-valve M-series motor displaces 1586cc and it generates 102 bhp at 5500 rpm

and 14.5 kgm torque at 4200 rpm. Hardly any revs? Well, this is a typical Euro-spec motor

from Suzuki and on that does not need to be revved to the moon for good results.

The ride quality is sublime for a Suzuki (I drive one on a daily basis, I should know) and the

car has enough ground clearance for you to quit worrying about speed breakers. The heart-

breaking thumps normally associated with fragile cars and potholes are missing in action.

The SX4 looks, feels and drives like a car that is better put together than any other Suzuki

that is made in India. Exceptional fit and finish (including the interior bit) takes it to the same

league as the Honda.

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Midsize car market in India was considered to be the next big thing for automotive industry.

But recent sales performance of midsize cars in India has been anything but great.

There are many player in this industry i.e. Honda, Mitsubishi , Tata indigo, Indigo Marina,

Ford Fiesta, Fiat Linea , Chevrolet Aveo, Optra, Maruti-Suzuki’s SX4, D’Zire, Hyundai

Verna, Accent, Skoda Octavia, Laura and many others. All these cars create a very fierce

competitive market. All these are highly competitive for Maruti SX4.

There are some following key competitors of SX4

1. Honda city

2. TATA Indigo

3. Fiat Linea

4. Chevrolet Aveo

5. Chevrolet Optra

6. Swift D’Zire

7. Hyundai Verna

8. Ford Ikon

9. Ford Fiesta

10.Skoda Laura

Tata Indigo

The Tata Indigo is a subcompact car manufactured by Indian automaker Tata Motors.

Indigo Sedan

In 2002, Tata introduced India's most competitive

indigenous sedan: the Indigo. Designed in-house, it is

best thought of as a sedan version of the Tata Indica,

with which it shares a large number of parts. It is

sometimes referred as the working man's luxury car.

Indigo SX

In 2005, Tata Motors released the Indigo SX, an upmarket version of the Indigo sedan with

a leather-trimmed steering wheel and leather seats, among other features like electrically

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operated outside rear view mirrors (ORVM), VCD player with LCD screens behind

headrests, apart from the standard features like power steering, power windows and central

locking. It competes with Honda City, Hyundai Accent and Maruti Suzuki SX4 / Maruti Swift


Indigo XL

The Tata Indigo XL went on sale in January 2007.[1]. It is the long wheel base version of the

Indigo sedean. It features a 200 mm (7.9 in) stretched wheelbase and a 101 hp engine.The

Petrol model has MPFI 16 valve twin cam engine,whereas the diesel variant features a

DICOR engine.

Indigo CS

Tata launched the Tata Indigo CS at the 2008 Auto Expo in New Delhi. CS stands for

compact sedan and is the world's shortest sedan. The Indigo CS falls within the norms

which allows it to be subjected to lower excise duty which brings the cost of the car down.

Indigo Marina

Tata Indigo Marina

The station wagon version called the Indigo Marina (called the

Indigo SW in export markets) was unveiled at the New Delhi

Auto Expo 2004.

Indigo Marina Advent

In 2004 Tata Motors unveiled the Tata Indigo Marina Advent which is a softroader similar to

the Fiat Adventure. It is said to be a crossover vehicle exhibiting certain SUV like



1.4 L petrol MPFI — 85 PS (84 hp/63 kW) at 5500 rpm, 12 kg-m (117 Nm) at 3500


1.4 L turbodiesel — 70 PS (69 hp/51 kW) at 4500 rpm, 13.5 kg-m (132 Nm) at 2500


1.4 L DICOR (only available in Europe & India)

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Honda City

(2005 Face-lifted


The Honda City is a subcompact car manufactured by the Japanese manufacturer Honda

since 1981 for the Asian market.

Since 2002, the City is also known as the Honda Fit Aria. It is a subcompact sedan that

uses Honda's Global Small Car platform, which is also used by the Fit/Jazz (a five-door

hatchback), the Airwave (a wagon version of the Fit Aria/City), the Mobilio, and the Mobilio

Spike. One of the characteristics shared by the Fit/Jazz, City/Fit Aria, and Airwave, is the

location of the fuel tank. Rather than placing it under the rear seats, it is located under the

front seats, thereby freeing up valuable room in the back.

Fourth generation (2002-2008)

Philippine Market Honda City.

In November 2002, the fourth generation City was

released and included a four-wheel drive version.

Like the contemporary Honda Jazz, the City is

actually a rebadged Honda Fit, in the City's case a

rebadged Fit Aria.

In September 2005, a face-lifted version of the City was launched in Thailand, Malaysia in

October 2005, and Indonesia in November 2005; it is known as the City ZX in Thailand,

India, the New City in Indonesia and Malaysia, and City in Singapore and Pakistan. The

most significant changes are a new exterior (new front grille, new headlamps, new fog

lights, new taillights and bumpers). The front end has been extended forward by 65 mm

(2.6 in) while the rear has been extended by 15 mm (0.6 in). The side mirror is electronically

foldable. Both the i-DSI and VTEC trim levels have 14-inch (360 mm) alloy wheels as

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standard equipment. Interior changes are minor but it does include an armrest for the driver

and additional map lights.

The engine remains the same but the intake manifold has been modified, resulting a 10%

temperature drop in the intake air temperature (IAT)[1], the suspension has been upgraded

as well.

Honda City in Thailand, Indonesia, Philippines, Pakistan, Singapore and Malaysia are using

CVT gearbox for both i-DSI and VTEC variants. The CVT gearbox simulates a 7-Speed

automatic transmission with Tiptronic style override using paddle shift buttons. This is very

rare for a subcompact of its class.

Fifth generation (2008–present)

The new Honda City was unveiled in Malaysia on the 10th of September 2008 [3] followed

by New Delhi, India on 25 September 2008[4]. and January 2009 in Pakistan and Indonesia.

Honda also announced that the City will be offered in selected European countries with a

1.4 liter i-VTEC engine mated to either a 5-speed manual or a 6-speed i-SHIFT automated

manual transmission.[5]

Guangzhou Honda will be developing a Honda Civic-sized sedan based on the Honda City

chassis for the Chinese market. It will have a new name and a new shape but will use the

City's underpinings and a 1.8 liter engine. This new car will compete against Dongfeng

Honda's Civic and FAW Toyota's Corolla.[6]

The Thai market Honda City comes in three variants - S model, V Model and SV model.

The Indonesian market was offered with two trims, the lower-spec S and the higher-spec E

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with reclining seats. Both are powered by a 1.5 engine putting out 120 bhp, and both are

available in manual and automatic transmissions.

Honda launched the new City in the Philippines on the 7th of January 2009 with four

variants; the 1.3 A with manual transmission, 1.3 S with manual and automatic

transmissions and the 1.5 E, whose automatic gearbox is equipped with paddle shifts that

promote more sporty driving enjoyment. All variants are now equipped with a SOHC, 16-

valve i-VTEC engines, creating an all-i-VTEC roster for Honda Cars this year. As a result,

drivers need not to worry about the lack of horsepower[7].

It will be launched in Malaysia on the 18th of December 2008. [8] It is scheduled to arrive in

Singapore by the end of September. For the first time, the car will be built and sold outside

Asia, being assembled in Argentina from 2009 on. Honda launched the new city in Pakistan

on 31 January 2009. It being produced at Honda plant at Lahore and is available in two

variants, 5 speed automatic transmission and 5 speed manual transmission. Both models

have a 1.3 liter i-VTEC engine.

Guangzhou Honda will be selling the Honda City in China from the 12th of December 2008

onwards. Unlike other markets where the largest engine option is a 1.5 liter, the Chinese

market Honda City will have an R18A 1.8 liter engine option.[9]

In February 2009, Honda Australia have released the Thai made City into the Australian

market in two 1.5 litre variants (VTi and VTi-L). According to Honda Australia boss,

Yasuhide Mizuno, the City will compete with other light sedans such as the Japanese made

Toyota Yaris sedan, Korean made Holden Barina and the Japanese made Nissan Tiida.[10]

This will be the first City released in Australia since the 1980s. It will replace the market

position used to be occupied by a former generation smaller-sized Civic.

This Honda City is also present in India with the engine of the 1.5 i-VTEC. This car is in

three variants : namely E MT which is manual, S MT which is also manual gear and the S

AT which is the automatic version.


The music group Madness appeared in a Japanese TV ad campaign for the Honda City.

The jingle was written by the entire band, which also appeared in the TV ad, doing its

famous "nutty walk". The band apparently liked the jingle so much that they expanded it into

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a three minute pop song and released it as a b-side (B/W "Cardiac Arrest") that reached

#14 in the UK charts. It was also included on Complete Madness, the band's best-selling

greatest hits compilation from 1982. The track version of "In The City" replaced the

repeated brand name "Honda Honda Honda..." with the more generic "doomba doomba

doomba". The TV advertisements were included (though not listed) on the Divine Madness

VHS video in 1992.

Fiat Linea

The Fiat Linea is a medium sized family car released

in 2007 by the Italian automaker Fiat as a world car in

Eastern Europe, Latin America and Middle East. In

India, the Fiat Linea was launched in January 2009

after it was postponed due to the Mumbai terror

attacks, in November 2008. [1] It replaced the aging

Marea as the largest saloon in the Fiat range. It is

based on the current Fiat Grande Punto platform. The Linea was designed by Fiat Style

Centre and co-developed by Fiat do Brasil and Tofaş from Turkey.

Linea's size is similar to saloon versions of other small family cars, like the Ford Focus,

Renault Mégane and Opel Astra. Its wheelbase is 2,603 mm (102.5 in), i.e. 100 mm (3.9 in)

longer than its sister models, and its total length is 4,560 mm (179.5 in) or 500 mm (19.7 in)


Launched in September 2008 in Brazil, the Linea is available with a 1.9 L 16v "Torque"

engine with 132 PS (97 kW; 130 hp), flexible for the Brazilian market (capable of using

petrol or ethanol). Also in Brazil the Linea is available with a 1.4 L 16v T-Jet engine with

152 PS (112 kW; 150 hp), the same engine used in Fiat Grande Punto Abarth in Europe,

capable of using only petrol, as this engine is imported.

Car systems

Linea is equipped with Blue&Me hands-free system, a Microsoft Windows Mobile based

system with multi-language voice recognition and speech functions. Allows to browse

mobile phone's book, reads aloud SMS and controls the audio system - using built-in USB

port, one can connect PenDrive with music in MP3 and WMA formats.

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In Brazil the Linea can be equipped optionally with a Blue&Me Nav system, an enhanced

Blue&Me system that has a GPS system integrated. This GPS system doesn't show maps

in a touch screen, but it has a regular display that shows some arrows and directions and

you are also guided by voice instructions. You can either enter addresses that you want to

go and other instructions by voice instructions just like the regular Blue&Me system or using

the controls on the steering whell. The Linea is the first car in Brazil that has an integrated

GPS system.





tPower Torque


km/h,sTop speed

1.4 - 8v I4 1368 cc77 PS (57 kW)

@ 6000 rpm

115 N·m

(85 lb·ft) @3000


14.6165 km/h

(103 mph)

1.4 16v T-

JetI4 1368 cc

120 PS (88 kW)

@ 5000 rpm

206 N·m

(152 lb·ft)

@1750 rpm

9.2195 km/h

(121 mph)




I4 1248 cc90 PS (66 kW)

@ 4000 rpm

200 N·m

(148 lb·ft)

@1750 rpm

13.8170 km/h

(106 mph)

1.9 16v

FlexI4 1839 cc

132 PS (97 kW)

@ 5750 rpm

183 N·m

(135 lb·ft)

@4500 rpm

10.5188 km/h

(117 mph)

1.4 16v T-

JetI4 1368 cc

152 PS

(112 kW) @

5500 rpm

207 N·m

(153 lb·ft)

@2250 rpm

8.5203 km/h

(126 mph)

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L'Unico Club

In Brazil, Fiat is aiming the Linea towards the Japanese cars, such as Honda Civic and

Toyota Corolla, the market leaders for its class. As such, Fiat has launched the L'Unico

Club, that offers VIP services for Linea owners, such as special exclusive lines and

exclusive attendants for Linea owners, get and deliver service for maintenance and 3 years

warranty, the biggest warranty for Fiat cars in Brazil.

Ford Ikon

manufactured and sold in South Africa, Mexico and China where production ended in

December 2006, September 2007 and 2007 respectively.

The Mexican and South African Ikon was closely based on the European Mark IV and V

Fiesta, delivering vehicle attributes that would have been acceptable to European

customers. The India Ikon has a cheaper suspension, interior and front end structure. The

China Ikon was somewhere in between.

In Mexico, Brazil and China, the Ikon was marketed as a Fiesta sedan. In Brazil, this model

has been replaced by a new 4 door model based on the South American Fiesta. In South

Africa, the Ikon has been replaced by a different 4 door model based on the European

Fiesta Mark VI (but different exterior sheetmetal) and manufactured in India. (This vehicle is

badged Fiesta in India and has not replaced the Ikon in the Indian market.)

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Comparison with competitors

Car Comparison: comparison between SX4 & AVEO


Maruti Suzuki SX4 ZXi

Chevrolet Aveo 2009 1.4 LS

Price (Ex-Showroom Mumbai) Rs. 7,49,094 Rs. 6,26,595


Air Conditioner 

Power Windows  

Power Steering

Anti-Lock Braking System x

Air-Bags (Driver | Passenger) | x|x

Leather Seats X X

CD Player X

Overall Length (mm) 4490 4310

Overall Width (mm) 1735 1710

Overall Height (mm) 1570 1505

Kerb Weight (kg) 1200 1095

Mileage Overall (km/liter)

Seating Capacity (person) 5 5

No of Doors 4 4

Displacement (cc) 1586 1399

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Power (PS@rpm) 102@5500 94@6200

Torque ( Nm@rpm) 145@4200 127@3400

Transmission Type Manual Manual

Gears 5 5

Minimum Turning Radius (meter) 5.3 5

Tyres 205/60 R16 185/60 R 14

Car Comparison: comparison between SX4 & OPTRA


Maruti Suzuki SX4 ZXi

Chevrolet Optra SRV 1.6 Option Pack

Price (Ex-Showroom Mumbai) Rs. 7,49,094 Rs. 7,83,479


FeaturesMaruti Suzuki SX4

ZXiChevrolet Optra SRV 1.6

Option Pack

Air Conditioner 

Power Windows  

Power Steering

Anti-Lock Braking System

Air-Bags (Driver | Passenger) | |

Leather Seats

CD Player

SpecsMaruti Suzuki SX4

ZXiChevrolet Optra SRV 1.6

Option Pack

Overall Length (mm) 4490 4295

Overall Width (mm) 1735 1725

Overall Height (mm) 1570 1445

Kerb Weight (kg) 1200 1230

Mileage Overall (km/liter) 10.8

Seating Capacity (person) 5 5

No of Doors 4 5

Displacement (cc) 1586 1598

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Power (PS@rpm) 102@5500 101@5800

Torque ( Nm@rpm) 145@4200 140@4500

Transmission Type Manual Manual

Gears 5 5

Minimum Turning Radius (meter) 5.3 5.2

Tyres 205/60 R16 195/60 R15

Car Comparison: comparison between SX4 & LINEA


Maruti Suzuki SX4 ZXi Fiat Linea Dynamic 1.4

Price (Ex-Showroom Mumbai) Rs. 7,49,094 Rs. 6,49,846


Features Maruti Suzuki SX4 ZXi Fiat Linea Dynamic 1.4

Air Conditioner 

Power Windows  

Power Steering

Anti-Lock Braking System

Air-Bags (Driver | Passenger) | |

Leather Seats

CD Player

Specs Maruti Suzuki SX4 ZXi Fiat Linea Dynamic 1.4

Overall Length (mm) 4490 4560

Overall Width (mm) 1735 1730

Overall Height (mm) 1570 1487

Kerb Weight (kg) 1200 1240

Mileage Overall (km/liter)

Seating Capacity (person) 5 5

No of Doors 4 4

Displacement (cc) 1586 1368

Power (PS@rpm) 102@5500 90@4000

Torque ( Nm@rpm) 145@4200 115@4500

Page 67: consumer behaviour.docx

Transmission Type Manual Manual

Gears 5 5

Minimum Turning Radius (meter) 5.3 5.5

Tyres 205/60 R16 195/60 R15

Car Comparison: comparison between SX4 & FIESTA


Maruti Suzuki SX4 ZXi Ford Fiesta 1.6 S

Price (Ex-Showroom Mumbai) Rs. 7,49,094 Rs. 7,47,477


Features Maruti Suzuki SX4 ZXi Ford Fiesta 1.6 S

Air Conditioner 

Power Windows  

Power Steering

Anti-Lock Braking System

Air-Bags (Driver | Passenger) | |

Leather Seats

CD Player

Specs Maruti Suzuki SX4 ZXi Ford Fiesta 1.6 S

Overall Length (mm) 4490 4282

Overall Width (mm) 1735 1686

Overall Height (mm) 1570 1468

Kerb Weight (kg) 1200 1130

Mileage Overall (km/liter) 10

Seating Capacity (person) 5 5

No of Doors 4 4

Displacement (cc) 1586 1596

Power (PS@rpm) 102@5500 101@6500

Torque ( Nm@rpm) 145@4200 146@3400

Transmission Type Manual Manual

Gears 5 5

Page 68: consumer behaviour.docx

Minimum Turning Radius (meter) 5.3 4.9

Tyres 205/60 R16 195/55R15

Car Comparison: comparison between SX4 & Honda City


Maruti Suzuki SX4 ZXi

Honda City 2008 1.5 E MT

Price (Ex-Showroom Mumbai) Rs. 7,49,094 Rs. 8,25,100


FeaturesMaruti Suzuki SX4

ZXiHonda City 2008 1.5 E


Air Conditioner 

Power Windows  

Power Steering

Anti-Lock Braking System

Air-Bags (Driver | Passenger) | |

Leather Seats

CD Player X

SpecsMaruti Suzuki SX4

ZXiHonda City 2008 1.5 E


Overall Length (mm) 4490 4420

Overall Width (mm) 1735 1695

Overall Height (mm) 1570 1480

Kerb Weight (kg) 1200 1100

Mileage Overall (km/liter)

Seating Capacity (person) 5 5

No of Doors 4 4

Displacement (cc) 1586 1497

Power (PS@rpm) 102@5500 118@6600

Torque ( Nm@rpm) 145@4200 146@4600

Transmission Type Manual Manual

Gears 5 5

Page 69: consumer behaviour.docx

Minimum Turning Radius (meter) 5.3 5.3

Tyres 205/60 R16 175 / 65 R15

Car Comparison: comparison between SX4 & VERNA


Maruti Suzuki SX4 ZXi

Hyundai Verna VTVT SX 1.6

Price (Ex-Showroom Mumbai) Rs. 7,49,094 Rs. 7,47,700


FeaturesMaruti Suzuki SX4

ZXiHyundai Verna VTVT SX


Air Conditioner 

Power Windows  

Power Steering

Anti-Lock Braking System

Air-Bags (Driver | Passenger) | |

Leather Seats

CD Player

SpecsMaruti Suzuki SX4

ZXiHyundai Verna VTVT SX


Overall Length (mm) 4490 4310

Overall Width (mm) 1735 1695

Overall Height (mm) 1570 1490

Kerb Weight (kg) 1200

Mileage Overall (km/liter)

Seating Capacity (person) 5 5

No of Doors 4 4

Displacement (cc) 1586 1599

Power (PS@rpm) 102@5500 103@5500

Torque ( Nm@rpm) 145@4200 147@3000

Transmission Type Manual Manual

Page 70: consumer behaviour.docx

Gears 5 5

Minimum Turning Radius (meter) 5.3

Tyres 205/60 R16 185/65 R14

Car Comparison: comparison between SX4 & LOGAN


Maruti Suzuki SX4 ZXi

Mahindra-Renault Logan GLX 1.4

Price (Ex-Showroom Mumbai) Rs. 7,49,094 Rs. 5,23,351


FeaturesMaruti Suzuki SX4

ZXiMahindra-Renault Logan

GLX 1.4

Air Conditioner 

Power Windows  

Power Steering

Anti-Lock Braking System

Air-Bags (Driver | Passenger) | |

Leather Seats

CD Player

SpecsMaruti Suzuki SX4

ZXiMahindra-Renault Logan

GLX 1.4

Overall Length (mm) 4490 4247

Overall Width (mm) 1735 1740

Overall Height (mm) 1570 1534

Kerb Weight (kg) 1200 1040

Mileage Overall (km/liter) 12.2

Seating Capacity (person) 5 5

No of Doors 4 4

Displacement (cc) 1586 1390

Power (PS@rpm) 102@5500 75@5500

Torque ( Nm@rpm) 145@4200 110@3000

Transmission Type Manual Manual

Page 71: consumer behaviour.docx

Gears 5 5

Minimum Turning Radius (meter) 5.3 5.3

Tyres 205/60 R16 185/70 R14

Car Comparison: comparison between SX4 & AVEO


Maruti Suzuki SX4 ZXi

Maruti Suzuki Swift Dzire ZDi

Price (Ex-Showroom Mumbai) Rs. 7,49,094 Rs. 6,94,075


FeaturesMaruti Suzuki SX4

ZXiMaruti Suzuki Swift Dzire


Air Conditioner 

Power Windows  

Power Steering

Anti-Lock Braking System

Air-Bags (Driver | Passenger) | |

Leather Seats

CD Player

SpecsMaruti Suzuki SX4

ZXiMaruti Suzuki Swift Dzire


Overall Length (mm) 4490 4160

Overall Width (mm) 1735 1690

Overall Height (mm) 1570 1530

Kerb Weight (kg) 1200 1115

Mileage Overall (km/liter)

Seating Capacity (person) 5 5

No of Doors 4 5

Displacement (cc) 1586 1248

Power (PS@rpm) 102@5500 75@4000

Torque ( Nm@rpm) 145@4200 190@2000

Transmission Type Manual Manual

Gears 5 5

Page 72: consumer behaviour.docx

Minimum Turning Radius (meter) 5.3 4.7

Tyres 205/60 R16 185/70 R 14 (tubeless)

Car Comparison: comparison between SX4 & INDIGO


Maruti Suzuki SX4 ZXi

Tata Indigo LS TDI - BS III

Price (Ex-Showroom Mumbai) Rs. 7,49,094 Rs. 5,10,472


FeaturesMaruti Suzuki SX4

ZXiTata Indigo LS TDI - BS


Air Conditioner 

Power Windows  

Power Steering

Anti-Lock Braking System

Air-Bags (Driver | Passenger) | |

Leather Seats

CD Player

SpecsMaruti Suzuki SX4

ZXiTata Indigo LS TDI - BS


Overall Length (mm) 4490 4150

Overall Width (mm) 1735 1620

Overall Height (mm) 1570 1540

Kerb Weight (kg) 1200 1155

Mileage Overall (km/liter) 12.5

Seating Capacity (person) 5 5

No of Doors 4 4

Displacement (cc) 1586 1405

Power (PS@rpm) 102@5500 70@4500

Torque ( Nm@rpm) 145@4200 125@2500

Transmission Type Manual Manual

Gears 5 5

Page 73: consumer behaviour.docx

Minimum Turning Radius (meter) 5.3 5

Tyres 205/60 R16 175/65 R14 Radial

Car Comparison: between SX4 & INDIGO XL


Maruti Suzuki SX4 ZXi

Tata Indigo XL Grand Petrol

Price (Ex-Showroom Mumbai) Rs. 7,49,094 Rs. 6,83,107


FeaturesMaruti Suzuki SX4

ZXiTata Indigo XL Grand


Air Conditioner 

Power Windows  

Power Steering

Anti-Lock Braking System

Air-Bags (Driver | Passenger) | |

Leather Seats

CD Player

SpecsMaruti Suzuki SX4

ZXiTata Indigo XL Grand


Overall Length (mm) 4490 4377

Overall Width (mm) 1735 1620

Overall Height (mm) 1570 1540

Kerb Weight (kg) 1200 1150

Mileage Overall (km/liter) 12

Seating Capacity (person) 5 5

No of Doors 4 4

Displacement (cc) 1586 1396

Power (PS@rpm) 102@5500 101@6100

Torque ( Nm@rpm) 145@4200 124@3500

Transmission Type Manual Manual

Gears 5 5

Minimum Turning Radius (meter) 5.3 5.5

Page 74: consumer behaviour.docx

Tyres 205/60 R16 175/65 R14 (tubeless)

Car Comparison: comparison between SX4 & Ford Ikon


Maruti Suzuki SX4 ZXi Ford Ikon 1.3 Rocam

Price (Ex-Showroom Mumbai) Rs. 7,49,094 Rs. 4,90,907


Features Maruti Suzuki SX4 ZXi Ford Ikon 1.3 Rocam

Air Conditioner 

Power Windows  

Power Steering

Anti-Lock Braking System

Air-Bags (Driver | Passenger) | |

Leather Seats

CD Player

Specs Maruti Suzuki SX4 ZXi Ford Ikon 1.3 Rocam

Overall Length (mm) 4490 4145

Overall Width (mm) 1735 1632

Overall Height (mm) 1570 1439

Kerb Weight (kg) 1200 995

Mileage Overall (km/liter)

Seating Capacity (person) 5 5

No of Doors 4 4

Displacement (cc) 1586 1297

Power (PS@rpm) 102@5500 70@5500

Torque ( Nm@rpm) 145@4200 105@2500

Transmission Type Manual Manual

Gears 5 5

Minimum Turning Radius (meter)

5.3 5

Tyres 205/60 R16 175 / 70 R13

Page 75: consumer behaviour.docx

Competitor’s analysis

Target Audience Early 30’s to Late 40’s

Positioning Driving Comfort, Fuel Efficiency

Performance VTEC Engine

Price range Rs. 716,200 to Rs. 845,200

Market share Highest in mid-size car segment

Weaknesses Highly priced with less features




Final (or ultimate) consumers purchase for:

· Personal,

· Family, or

· Household use

Organizational consumers purchase for:

· Further production,

· Usage in operating the organization, and/or

· Resale to other consumers

Consumer Buying Behavior

Page 76: consumer behaviour.docx

The decision processes and acts of final household consumers associated with evaluating,

buying, consuming, and discarding products for personal consumption

Consider the purchase an automobile. You generally will not consider different options until

some event triggers a need, such as a problem needing potentially expensive repair. Once

this need has put you "on the market", you begin to ask your friends for recommendations

regarding dealerships and car models. After visiting several dealerships, you test drive

several models and finally decide on a particular model. After picking up your new car, you

have doubts on the way home, wondering if you can afford the monthly payments, but then

begin to wonder if instead you should have purchased a more expensive but potentially

more reliable model. Over the next five years, the car has several unexpected breakdowns

that lead you to want to purchase a different brand, but you have been very happy with the

services of the local dealership and decide to again purchase your next car there.

In this particular case, the following generic model of consumer decision making

appears to hold:

=====>need recognition

=====>information search

=====>evaluation of alternatives

=====>purchase decision

=====>post purchase behavior

Now consider the purchase of a quart of orange juice. You purchase this product when you

do your grocery shopping once per week. You have a favorite brand of orange juice and

usually do your grocery shopping at the same store. When you buy orange juice, you

always go to the same place in the store to pick it up, and never notice what other brands

are on the shelf or what the prices of other brands are. How is it that the generic model

above works differently in this second scenario? Why does it work differently? Why would

we generally need the ministrations of a sales person in the sale of a car, but we generally

do not need the help of a salesperson in the purchase of orange juice?

How can the marketer of orange juice get a consumer like you to exert more effort into

information search or to consider alternative products? How is it that the marketer of your

brand got you to ignore alternative competing brands? What is the involvement of

Page 77: consumer behaviour.docx

salespeople in sales promotions that might be associated with products such as orange


Consumer behavior researchers are not so interested in studying the validity of the above

generic model, but are more interested in various factors that influence how such a model

might work.




-e.g., cultural, family, reference group influence


-e.g., time of day, temperature and humidity, etc.


lifestyle, personality, decision making process, motivation, etc.



The set of basic values, beliefs, norms, and associated behaviors that are learned by a

member of society.

Note that culture is something that is learned and that it has a relatively long lasting effect

on the behaviors of an individual. As an example of cultural influences, consider how the

salesperson in an appliance store in the U.S. must react to different couples who are

considering the purchase of a refrigerator. In some subcultures, the husband will play a

dominant role in the purchase decision; in others, the wife will play a more dominant role.

Social Class

A group of individuals with similar social rank, based on such factors as occupation,

education, and wealth.

Reference Groups

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Groups, often temporary, that affect a person's values, attitude, or behaviors· E.g., your

behaviors around colleagues at work or friends at school are probably different from your

behaviors around your parents, no matter your age or stage in the family life cycle. If you

were a used car salesperson, how might you respond differently to a nineteen year old

prospect accompanied by her boyfriend from one accompanied by two girlfriends?

Opinion leader

A person within a reference group who exerts influence on others because of special skills,

knowledge, personality, etc.

You might ask the webmaster at work for an opinion about a particular software application.

Software manufacturers often give away free beta copies of software to potential opinion

leaders with the hope that they will in turn influence many others to purchase the product.


A group of people related by blood, marriage, or other socially approved relationship.

Environmental / situational influences on consumer Behavior

Circumstances, time, location, etc

Do you like grapes? Do you like peas?

You might like grapes as a snack after lunch, but probably not as a dessert after a fancy

meal in a restaurant. You might like peas, but probably not as a topping on your pancakes.

Everyday situations cause an interaction between various factors which influence our

behaviors. If you work for tips (a form of incentive related to commission) as a waiter or

waitress, you must certainly be aware of such interactions which can increase or decrease

your sales.

If you are doing your Saturday grocery shopping and are looking for orange juice, you are

probably much more sensitive to price than if you stop at the quick store late at night, when

you are tired and cranky, after a late meeting at the office. A prospect shopping for a new

automobile while debating the wisdom of a necessary expensive repair to his car might be

Page 79: consumer behaviour.docx

more interested in what cars are on the lot than in shopping for the best deal that might

involve a special order.

Internal influences on consumer behavior


A person's distinguishing psychological characteristics that lead to relatively consistent and

lasting responses to stimuli in the environment We are each unique as individuals, and we

each respond differently as consumers. For example, some people are "optimizers" who

will keep shopping until they are certain that they have found.

The best price for a particular item, while other people are "satisfiers" who will stop

shopping when they believe that they have found something that is "good enough”. If you

are a salesperson in a retail shoe store, how might you work differently with these two


Lifestyle and Psychographics

Lifestyle is a pattern of living expressed through a person's activities, interests, and


Psychographics is a technique for measuring personality and lifestyles to

developing lifestyle classifications.

Motivation: Multiple motives

Consumers usually have multiple motives for particular behaviors. These can be a

combination of:


Known to the person and freely admitted


Unknown to the person or the person is very reluctant to admit

Page 80: consumer behaviour.docx

Note: different motives can lead to the same behavior; observing behavior is not sufficient

to determine motives.

What are the thoughts of John's friend?

What is John's manifest motive?

What might be his latent motive?

How might a salesperson discover these motives?

What features should a salesperson emphasize?


Has to do with an individual's

intensity of interest in a product and the

importance of the product for that person

The purchase of a car is much more risky than the purchase of a quart of orange juice, and

therefore presents a higher involvement situation. This modifies the way that the generic

model works.

As involvement increases, consumers have greater motivation to comprehend and

elaborate on information salient to the purchase. A life insurance agent, for example, would

typically be more interested in contacting a young couple who just had a baby than an

eighteen year old college student - even though the new parents might be struggling to

Page 81: consumer behaviour.docx

make ends meet while the student is living more comfortably. Although the annual

investment into a policy is much lower if started at a younger age, most young college

students are not open to thinking about long term estate planning. A young couple with a

new child, however, is much more open to thinking about issues associated with planning

for the child's future education, saving to buy a house, or even saving to take an extended

vacation upon retirement.



used when buying frequently purchased, low cost items

used when little search/decision effort is needed

e.g., buying a quart of orange juice once per week

Limited Problem Solving

Used when products are occasionally purchased.

Used when information is needed about an unfamiliar product in a familiar product


Extended problem solving

Used when product is unfamiliar, expensive, or infrequently purchased.

e.g., buying a new car once every five years.

Under what sorts of conditions the assistance of a salesperson would be needed? Not




After the sale, the buyer will likely feel either satisfied or dissatisfied. If the buyer believes

that s/he received more in the exchange than what was paid, s/he might feel satisfied. If

s/he believes that s/he received less in the exchange than what was paid, then s/he might

feel dissatisfied.

Dissatisfied buyers are not likely to return as customers and are not likely to send friends,

relatives, and acquaintances. They are also more likely to be unhappy or even abusive

Page 82: consumer behaviour.docx

when the product requires post-sale servicing, as when an automobile needs warranty


The above idea can be modeled as Homans' basic exchange equation:

Profit = Rewards - Costs

Unfortunately, even a buyer who "got a good deal" with respect to price and other terms of

the sale might feel dissatisfied under the perception that the salesperson made out even

better .

This idea is called equity theory, where we are concerned with:

Outcomes of A

Inputs of A


Outcomes of B

Inputs of B

Consider, for example, that you have purchased a used car for $14,000 after finding that

the "e:blue book" value is listed at $16,000. You are probably delighted with the purchase

until you accidentally meet the prior owner who had received a trade-in of $10,000 on the

car just a few days before. That the dealer appears to have received substantially greater

benefit than you could lead to extreme dissatisfaction, even though you received good

value for the money spent.

(Note that the selling dealer might actually have paid $12,000 for the car at a statewide

dealer's auction, and then might have incurred another $1,000 in expenses associated with

transporting the car and preparing it for sale. Management of buyer perceptions is very


An issue related to this is attribution theory. According to attribution theory, people tend to

assign cause to the behavior of others. Mary's life insurance agent advises her to purchase

a whole life policy, while her accountant advises her, "buy term insurance and invest the

difference.” The reason, explains the accountant, "is that insurance agents receive

substantially higher commission payments on sales of whole life policies."

If Mary believes that the insurance agent is recommending a product merely because he

receives a higher commission, she will likely be displeased with the relationship and will not

take his recommendation. If the agent is able to show Mary that the recommended product

is the best solution for her situation, then she will likely attribute his recommendation to

Page 83: consumer behaviour.docx

having her best interests in mind and will not be concerned about how it is that he is

compensated for his services.

Cognitive dissonance

It has to do with the doubt that a person has about the wisdom of a recent purchase

It is very common for people to experience some anxiety after the purchase of a product

that is very expensive or that will require a long term commitment. Jane and Fred, for

example, signed a one year lease on an apartment, committing themselves to payments of

$1500 per month. A week later, they are wondering if they should have instead leased a

smaller $900 apartment in a more rough part of town; they are not sure if they really can

afford this much of a monthly obligation. Dick and Sally, on the other hand, ultimately rented

the $900 apartment, and now are wondering if the savings in rent will be offset by noisy and

sometimes unsafe conditions in this neighborhood.

Perhaps neither couple would be experiencing this anxiety if their landlords had given them

just the smallest of assurances that they had made a good decision. After a close on

products that are expensive or that require a long term commitment, the salesperson

should provide the prospect with some reasons to be happy with the decision. Allow the car

buyer to reinforce her own positive feelings by calling her a week after the purchase to ask

how things are going. Call the new life insurance policy holder after two months to see if

there are any questions; a lack of questions can only help the buyer to convince himself

that he did the right thing.



Section 1

1. Name: ……………………………………………………………………………………….

2. Date: ………………………………………………………………………………………...

Page 84: consumer behaviour.docx

3. Sex:



4. Age:



Above 50 years

5. Profession:

Government Employee


Private sector employee



Any Other

6. Monthly Income:

Rs. 10,000 – Rs. 20,000 Rs. 20,000 – Rs. 30,000

Rs. 30,000 – Rs. 40,000 Above Rs. 40,000

Section 2

7. Which passenger vehicle do you have?


MUV any other specify…………………………………………………

8. Which Mid-size luxury car would you prefer to buy?

Ford Ikon SX4 Fiat Linea

Hyundai Verna TATA Indigo Ford Fiesta

Page 85: consumer behaviour.docx

Swift Dezire Chevrolet Aveo

9. Which feature of SX4 attracts you most, that inspires you to go for SX4?

Price Interior

Design Engine power

All Above Can’t Say

10. Which color of SX4 would you prefer?

Metallic clear beige Pearl metallic arctic white Metallic sunlight copper

Metallic azure grey Metallic silky silver Metallic midnight Black

11. Do you think SX4 is premium car?

Yes No Can’t Say

12. Will you recommend SX4 to your friends and relatives?

Yes No Can’t Say

13. How will you feel if SX4 is used as taxi?

Embarrass Don’t care Can’t say

14. Can you trust SX4 for safety?

Yes No Can’t say

15. From which source you get the information about SX4


News Paper




Page 86: consumer behaviour.docx


16.Rank following attributes of SX4 in order to preference given by you, while buying


Brand Name




Comfort/ interior

Bulbous rear

17.Do you think that purchase decision of SX4 enhance your status?



18. For what purpose would you like to use SX4?

Will offer to you use for business purpose

Will use as family car

Will prefer as taxi

Would like to offer as gift

For any other reason

19.Do you think that SX4 is a dream car of yours?

Yes No Can’t say

20. On what occasion would you like to buy SX4?

Dewali Eid

Dhanteras New Year

Marriage Navratra

21.Which car you are using now?

Small car sedan car

Multi utility vehicle sports utility vehicle

Super luxury car any other

Page 87: consumer behaviour.docx

Place: …………….. ……………….

Date: ……………… Signature