Industry Analysis Report

Of

AUTOMOBILE INDUSTRY(TWO WHEELERS)

Submitted

To

Department of Business Administration

By

B.SANTHOSH KUMAR

08D31E0040

INDUR INSTITUTE OF ENGINEER & TECHNOLOGY

(Affiliated to JNTU)

Ponnala (V), Siddipet (M), Medak – 502 277 AP

(2008-2010)

CERTIFICATE

This is to certify that the Industry Analysis entitled “TWO WHEELER

INDUSTRY” submitted by B.SANTHOSH KUMAR to Indur Institute of

Engineering and Technology is a record of independent analysis report done

during the Academic Year 2009-2010.

Head of the Department IndustryAnalysis Guide

Mr.Dr.R.Suresh Kumar Mr.venkateshwer rao

M.B.A (Professor) M.B.A(AssistantProfessor)

DECLARATION

I B.SANTHOSH KUMAR, here by declare that the industry entitled “TWO

WHEELER INDUSTRY”, submitted to INDUR INSTITUTE OF

ENGINEERING AND TECHNOLOGY. Drafted by me is an original work of

my own and has not been submitted to any college/university earlier. This

industry analysis has been written & submitted by me under the guidance of

Mr.venkateshwer rao, department of management Indur institute of Engineering

and Technology, Ponnal, Siddipet, Medak Dist.

Place: SIDDIPET B.SANTHOSHKUMAR

Date: (08D31E0040)

ACKNOWLEDGEMENT

For completing this Industry analysis, a few people have been very helpful. I

would like to lay the word of gratitude for them imprinted. First of all I would like

to thank sincerely to our H.O.D, Mr. Dr.R.Suresh Kumar for his

encouragement, motivation and kind of help to complete this analysis. I would

like to thank my college faculty, and internal guide .venkateshwer rao for her

guidance, suggestions, help, support and encouragement. Finally I would like to

extend my sincere thanks to my friends and relatives for their valuable help.

Place: SIDDIPET B.SANTHOSH KUMAR

Date: (08D31E0040)

CONTENTS PAGE NO. CHAPTER-I INTRODUCTION

Industry origin and growth

CHAPTER-II INDUSTRY ANALYSIS

Government rules and Regulations

SWOT Analysis

Industry present and future trends

Major firms in an industry

Firms or Company strategies

CHAPTER-III DESIGN OF THE STUDY

Objectives

Scope

Methods of data collection

Data analysis

Limitation of the study

CHAPTER - IV DATA ANALYSIS

Data analysis & interpretation

CHAPTER-V

Findings

Suggestions

Conclusions

BIBLOGRAPHY

CHAPTER-I INTRODUCTION

Industry origin and growth;-

The two-wheeler industry in India has grown rapidly in the country since

the announcement of the process of liberalization in 1991 by the then finance

minister Dr. Manmohan Singh, now Prime Minister of India.

Previously, there were only a handful of two-wheeler models available in

the country. Currently, India is the second largest producer of two-wheelers in the

world. It stands next only to China and Japan in terms of the number of two-

wheelers produced and the sales of two-wheelers respectively. In the year 2005-

2006, the annual production of two-wheelers in India stood at around 7600801

units.

The trend of owning two-wheelers is due to a variety of facts peculiar to

India . One of the chief factors is poor public transport in many parts of India .

Additionally, two-wheelers offer a great deal of convenience and mobility for the

Indian family.

Bajaj auto began trading in imported Vespa Scooters in 1948. Meanwhile

Automobile Products of India (API) commenced production of scooters in the

country in the early 50’s. Until 1958, API and Enfield were the only producers of

two-wheelers in India. However, Bajaj signed a technical collaboration in 1960

with Piaggio of Italy to produce Bajaj Scooters. This deal expired in 1971.

The condition of motorcycle manufacturers was no different. Until

the mid 80’s, there were only three major motorcycle manufacturers in India

namely Rajdoot, Escorts, and Enfield . The two-wheeler market was opened to

foreign manufacturers in the mid 80’s. The industry, which had seen a smooth

ride before, faced fierce foreign competition.

Motorcycle companies like the Yamaha, Honda, and Kawasaki , set up

shop in India in collaboration with various Indian two-wheeler companies.

Companies like Escorts, Rajdoot and faced immense competition from smaller

100 cc Japanese technology motorbikes. Bikes manufactured by Hero Honda, the

only company manufacturing four-stroke bikes at that time, gained massive

popularity.

In the mid 80’s, Kinetic introduced a variomatic gearless scooter in

collaboration with Honda. This scooter became instantly popular with the younger

generation, especially people who found it difficult to use geared scooters. The

introduction of scooterettes created another segment for people such as women

and teenagers who could not get used to driving either motorcycles or gearless

scooters. Many companies such as Kinetc, TVS, and Hero also started

manufacturing mopeds that proved immensely popular with people who wanted a

simple riding machine.

The change in the government’s policy owning to pollution control

norms and the Kyoto agreement saw the phasing out of two stroke two-wheelers

from production. Currently there are around 10 two-wheeler manufacturers in the

country, they being Bajaj, Hero, Hero Honda, Honda, Indus , Kinetic, Royal

Enfield, Suzuki, TVS, and Yamaha.

The latest trend in the two-wheeler market is the introduction of

electrically operated vehicles from a range of manufacturers such as Indus and

Hero. These can be recharged from convenient household electrical points. The

only disadvantage is speed, which is restricted to around 25 miles per hour.

Currently, the motorcycle market is witnessing a demand for higher

volume engines. Previously, the 100 c bikes were very popular owning to the high

fuel efficiency offered. However, the market is maturing fast. Sensing this

movement, Bajaj has introduced the Bajaj Pulsar, with 150, 180 and 200 cc

engines with Dual Twin Spark Ignition (DTSi) technology.

The two-wheeler industry in India has grown rapidly in the country since the

announcement of the process of liberalization in 1991 by the then finance minister

Dr. Manmohan Singh, now Prime Minister of India.

Previously, there were only a handful of two-wheeler models

available in the country. Currently, India is the second largest producer of two-

wheelers in the world. It stands next only to China and Japan in terms of the

number of two-wheelers produced and the sales of two-wheelers respectively. In

the year 2005-2006, the annual production of two-wheelers in India stood at

around 7600801 units.

The trend of owning two-wheelers is due to a variety of facts

peculiar to India . One of the chief factors is poor public transport in many parts

of India . Additionally, two-wheelers offer a great deal of convenience and

mobility for the Indian family.

Bajaj auto began trading in imported Vespa Scooters in 1948.

Meanwhile Automobile Products of India (API) commenced production of

scooters in the country in the early 50’s. Until 1958, API and Enfield were the

only producers of two-wheelers in India. However, Bajaj signed a technical

collaboration in 1960 with Piaggio of Italy to produce Bajaj Scooters. This deal

expired in 1971.

The condition of motorcycle manufacturers was no different. Until the

mid 80’s, there were only three major motorcycle manufacturers in India namely

Rajdoot, Escorts, and Enfield . The two-wheeler market was opened to foreign

manufacturers in the mid 80’s. The industry, which had seen a smooth ride before,

faced fierce foreign competition.

Motorcycle companies like the Yamaha, Honda, and Kawasaki , set up

shop in India in collaboration with various Indian two-wheeler companies.

Companies like Escorts, Rajdoot and faced immense competition from smaller

100 cc Japanese technology motorbikes. Bikes manufactured by Hero Honda, the

only company manufacturing four-stroke bikes at that time, gained massive

popularity.

In the mid 80’s, Kinetic introduced a variomatic gearless scooter in

collaboration with Honda. This scooter became instantly popular with the younger

generation, especially people who found it difficult to use geared scooters. The

introduction of scooterettes created another segment for people such as women

and teenagers who could not get used to driving either motorcycles or gearless

scooters. Many companies such as Kinetc, TVS, and Hero also started

manufacturing mopeds that proved immensely popular with people who wanted a

simple riding machine.

The change in the government’s policy owning to pollution control norms and the

Kyoto agreement saw the phasing out of two stroke two-wheelers from

production. Currently there are around 10 two-wheeler manufacturers in the

country, they being Bajaj, Hero, Hero Honda, Honda, Indus , Kinetic, Royal

Enfield, Suzuki, TVS, and Yamaha.

The latest trend in the two-wheeler market is the introduction of

electrically operated vehicles from a range of manufacturers such as Indus and

Hero. These can be recharged from convenient household electrical points. The

only disadvantage is speed, which is restricted to around 25 miles per hour.

Currently, the motorcycle market is witnessing a demand for

higher volume engines. Previously, the 100 c bikes were very popular owning to

the high fuel efficiency offered. However, the market is maturing fast. Sensing

this movement, Bajaj has introduced the Bajaj Pulsar, with 150, 180 and 200 cc

engines with Dual Twin Spark Ignition (DTSi) technology.

Growth:-

Credit Analysis and Research (CARE Ratings) says that the rural India

will be the next growth frontier for the Indian two wheeler industry. 

Domestic two-wheeler sales have grown to around 11.3 million by

financial year 2014 from 7.4 million in financial year 2009 is also projected by

the credit rating agency’s research arm. 

“The two-wheeler penetration in rural area is at 211 per thousand, as

compared with 644 per thousand in urban areas. That leaves plenty of scope for

two-wheeler companies such as Hero Honda, Bajaj Auto, TVS and Honda

Motorcycle and Scooter India to expand their footprint there,” says the deputy

managing director of CARE Ratings, D R Dogra. 

In the FY09 a modest annual growth of 2.6% is seen by the domestic

two-wheeler industry. Even though a very depressive monsoon is foreseen, still

the sales are expected to grow at a faster rate by industry this year as the financing

availability is expected to become easier. Revati Kasture, head, CARE Research

says that, “Two-wheeler sales are forecast to grow by 6.7 per cent in 2009-10 to

7.9 million units from 7.4 million in 2008-09”. 

“Positive factors such as the excise duty cut, lower fuel prices and

lower interest rates and easing liquidity situation have helped the two-wheeler

companies to improve their sales in urban and rural areas in the present financial

year.

In this background, given already high penetration in urban markets, rural India

offers big opportunity to the industry.” 

The rating agency’s study also reveals that the growing numbers of

working women have also gradually emerged as a large consumer segment,

especially for gearless scooterettes. Around 30 per cent of the women in India are

earning an independent income, as against 22 per cent in 1990-91 is estimated by

CARE. 

The report says, with the women also joining the workforce, the

disposable income of households increased. Better affordability is thus playing a

key role in boosting two-wheeler demand.

Kasture said, “Rural customers look for sturdiness and high mileage as

critical factors that influence their buying decision. Therefore, motorcycles with

engine capacity of 75-125 cc have a high demand in these markets”.

History:-

The Britannica Encyclopaedia describes a motorcycle as a bicycle or

tricycle propelled by an internal-combustion engine (or, less often, by an electric

engine). The motors on minibikes, scooters, and mopeds, or motorized

velocipedes, are usually air-cooled and range from 25 to 250 cubic cm (1.5 to 15

cubic inches) in displacement; the multiple-cylinder motorcycles have

displacements of more than 1,300 cubic cm.

The automobile was the reply to the 19th-century dream of self-

propelling the horse-drawn carriage. Similarly, the invention of the motorcycle

created the self-propelled bicycle. The first commercial design was a three-

wheeler built by Edward Butler in Great Britain in 1884. This employed a

horizontal single-cylinder gasoline engine mounted between two steerable front

wheels and connected by a drive chain to the rear wheel.The 1900s saw the

conversion of many bicycles, or pedal cycles by adding small, centrally mounted

spark ignition engines. There was then felt the need for reliable constructions.

This led to road trial tests and competition between manufacturers. Tourist

Trophy (TT) races were held on the Isle of Man in 1907 as reliability or

endurance races. Such were the proving ground for many new ideas from early

two-stroke-cycle designs to supercharged, multivalve engines mounted on

aerodynamic, carbon-fibre reinforced bodywork.

Origin of Motor-Scooters:-

Edward Butler, an Englishman, built the first motor tricycle in 1884.

The first gasoline-engine motorcycle to appear publicly was built by Gottlieb

Daimler, of Bad Cannstatt, Germany, in 1885. The first practical engines and

motorcycles were designed by the French and Belgians, followed by British,

German, Italian, and American makers.

The popularity of the vehicle grew, especially after 1910. During

World War I the motorcycle was used by all branches of the armed forces in

Europe, principally for dispatching. After the war it enjoyed a sport vogue until

the Great Depression began in 1929. After World War II a revival of interest in

motorcycles lasted into the late 20th century, with the vehicle being used for high-

speed touring and sport competitions.

The practice of attaching auxiliary engines to bicycles in western

Europe and parts of the United States led to the development during the 1950s of

a new type of light motorcycle, the moped. Originating in Germany as a 50-cubic-

centimetre machine with simple controls and low initial cost, it was largely free of

licensing and insurance regulations except in Great Britain.

The more sophisticated motor scooter originated in Italy soon after

World War II, led by manufacture of a 125-cubic-centimetre model. Despite

strong competition from West Germany, France, Austria, and Britain, the Italian

scooters maintained the lead in the diminishing market. The scooter has small

wheels from 20 to 36 cm (8 to 14 inches) in diameter, and the rider sits inside the

frame. Power units are placed low and close to the rear wheel, which is driven by

bevel gearing or chain. Capacities vary from 50 to 225 cubic cm, and four-speed

gearing is common.

History of E-Bikes:-

The concept of E-bike is not new. A workable prototype was first

produced in America as barley as 1834 till the late 1890’s; E-bikes were

considered to be the future. EV in India launch by EKO vehicles private limited in

1983 by the name of product VIDUT 24. it was a technical success but it was

failed because of manufacturing system was not perfected and since the sales

volumes were low, retail prices could not be brought down.

E-bikes Market:-

In 2008-09 more then 11 millions two wheelers were sold in country.

Of these, 7.81 millions were motorcycles or step-thoughts, 11.08 lakh were

largely scooterettes and another 5.32 lakh were mopeds. A bare 70,000 were

electric two wheelers. By the end of this financial year in March, two wheeler

sales will surge past the 8 million mark, and EV sales should be 3 lakh vehicles in

India the years.

Overview:-

Electric vehicles are virtually maintenance free. It has no gears, no

engine, no belt or chain drive, zero emission, no pollution, electronic start and

accelerator, besides it is exempted from the Central Vehicles registration act by

the Automotive Research Association of India (ARAI) and does not require any

registration or license. These bikes are usually chargeable at 220V which your

refrigerator requires. For charging bikes require special adapter. Batteries, Motors

and other electrical kits are imported from china and other countries whereas

mechanical design and assembly of these bikes are done here. Electric bikes target

School students, women and who are under 18 years of age. Following is the

review on some of the manufacturers and their products in India.

Yo Bykes:

Indus - division of Electrotherm a gujrat based company is the recent

player in electric vehicle market. It offers two scooterette and four bikes models

with the motor power range 200-250W. YO-smart scooter model from Indus

come with a very compact dimension. The vehicle weighs less and has a payload

of 75kg. YO-smart vehicle clocks a top speed of 25km/hr and the vehicle offers a

range/charge mileage of 75km. Charge duration required is 6 – 8hours.

Electrotherm’s YOBikes are ranged between Rs 13,999 and Rs 23,249.

EKO vehicle:-

EKO vehicle a Bangalore based company offers EKO cosmic –I scooter

and EGO bike. This company has been in this business for a long time and has

dealers in various locations in India than its counterparts. Battery weighs at 28kgs

and has a life of 12000 – 15000kms. The company offers a rapid charger which

will charge the bike at 10 – 15 minutes (good for intuitional consumers). Cosmic

offers a variable mileage depends on your payload. The maximum speed is 40

km/hr and Cosmic noise is less than 60decibel. Cosmic is offered in five colours

and is exported many countries.

Hero/ultra motors:-

Hero cycles (Hero Honda group) - UK Ultra Motor Group will launch

electric three wheeler by the end of fiscal 2007. Hero - Ultra also has plans to tap

the nascent electric vehicle market in a big way. Hero - Ultra plans to sell 1lakh

electric vehicles by 2008. They have launched India’s first exclusive electric

vehicle showroom in New Delhi. By April 2007 they also plan to establish 15

more dealership in North India. Investment for a dealership requires 15-20 lakhs.

Currently Hero - Ultra offers E-Bikes in the range of 14500 - 19000 and E-

Scooters in the range of 22500 - 28000.

China’s Shenzhen Zhongmo Technology Co Ltd:-

In West Bengal Battery-operated bikes to flood soon, It will get from

kolkata, Burdwan, Durgapur & etc. Bengal Enamel Works Ltd. with a venture in

the automobile sector with China’s Shenzhen Zhongmo Technology Co Ltd to

launch light battery-operated two-wheelers developed by Benlin Electric Cycles

Company of Japan.

This e-bikes has all total 43 models now starts with 8 Models. These new gearless

bikes should be able to travel 45 km to 100 km on a single charge. Being below

250 watt, it will have a top speed of 25 km/h. it requires no registration, driving

neither license nor payment of road taxes. BENLIN E-bikes starts with 8 Models

priced at Rs. 18600/- to Rs. 45200/-(it has with disk break)

ACE motors:-

Pune based Ace motors manufacturers e-bike (electric bike) and the

majority of the components of this bike are imported from China based company

Changtong E Bike Company Ltd. The e-bikes from Ace Motors weigh almost

60kg. The bike offers a load-carrying capacity of 100-140 kg. To cover a distance

of 220 km, you need to charge the bike for 6 - 8 hours at 220 volts. The maximum

speed of the bike is 25 km/hr and is priced at Rs 26,500.

Verdict:-

“It is estimated that India’s fossil fuel dependency on other countries

currently from 70% to 82% in 2012. If we can have three lakh Electric Vehicles

on the roads by 2020, including three-wheelers, cars, and scooters, this could

result in a reduction of over 16 lakh metric tons of CO, NOx and HC by 2020,

savings of over Rs 3,700 crore in foreign exchange and significant health costs

savings”—- automonitorGovernment has reduced the custom duty on three of the

imported components in battery operated vehicles (BOV) to 10%.Excise duty

reduced on electric vehicles from 16% to 8% in 2004 budget. But the industry

feels that the efforts are not sufficient.

Toyota Prius the model which accounts for nearly 80 per cent of the

hybrid vehicle sold globally is about Rs 10 lakh in the US. In India at current

levels of duty, it could cost anywhere between Rs 20-25 lakh because of the high

import duty. At present total import duty is 111% (60% on CBU imports plus

countervailing duties and other levies).

According to A Toyoshima, managing director, Toyota Kirloskar, the

Indian government should relax the duty structure for such hybrid vehicles to

promote eco-friendly technology in the country. Honda said that the new small

car it plans to offer in 2009 would be a hybrid if the government makes required

tax sops. If government wishes a greener future it has to take necessary actions to

encourage the industry, if you want to save the earth buy an e-vehicle.

About Indus: Indus Elec-trans, a division of Electrotherm (ET), is formed

to manufacture electric vehicles and hybrid electric vehicles. Its vision is to offer

an efficient, economical and eco friendly future to the Indian transportation. This

new Auto division will cater to the common man's need for both individual and

mass transportation. Fuelled by Innovation, INDUS will strive to provide the

futuristic driving solutions through unconventional, environment friendly,

innovative yet reliable technology and enduring products.

Based upon innovative, novel ideas and best quality practices, INDUS will

bring a revolutionary change in Indian Automobile Market. The expertise in

power electronics and electrical technology has lead ET into this motoring

venture. ET’s excellent practices for customer care will continue to be the

backbone. However, the biggest strength lies in the visionary people who have

given ET the international repute for the futuristic products.

Currently INDUS has commenced manufacture of hi-tech electric two

wheelers, YObykes at the state-of-the-art plant at Kutch in Gujarat. Development

of Electric three wheelers, four wheelers and hybrid electric low floor buses are

on anvil for future.

CHAPTER-II INDUSTRY ANALYSIS

Government Policies Towards Indian Automobile Industry

Automobile industry in India also received an unintended boost from

stringent government auto emission regulations over the past few years. This

ensured that vehicles produced in India conformed to the standards of the

developed world.

Though it has an advantage in India, thanks to low costs and

government policies it soon faces stiff competition from it multinational

competitors all eyeing for a share in the ever growing Indian auto sector. The

policies adopted by Government will increase competition in domestic market,

motivate many foreign commercial vehicle manufactures to set up shops in India,

whom will make India as a production hub and export to nearest market.

Bring in a minimum foreign equity of US $ 50 Million if a joint venture

involved majority foreign equity ownership

Automatic approval for foreign equity investment upto 100% of

manufacture of automobiles and component is permitted

FIIs including overseas corporate bodies (OCBs) and NRIs are permitted

to invest up to 49 per cent of the paid-up equity capital of the investee

company, subject to approval of the board of directors and of the members

by way of a special resolution. .

Investments in making auto parts by a foreign vehicle maker will also be

considered a part of the minimum foreign investment made by it in an

auto-making subsidiary in India. The move is aimed at helping India

emerge as a hub for global manufacturing and sourcing for auto parts.

Specific component of excise duty applicable to large cars and utility

vehicles will be reduced to 15,000 rupees per vehicle from 20,000 rupees

earlier.

The Proposal by the Govt. to set up an expert group to advise on a viable

and sustainable system of pricing petroleum products, as this will surely

had an impact on the Automobile Industry.

The announced reduction on the basic customs on bio-diesel is great news

for all companies working on environmental saving technologies.

Rules and Regulations for Importing Bikes in India :-

Bike enthusiasts from different corners of India have been importing high-

performance bikes to satiate their zeal for high-speed biking. Notwithstanding

their astronomical price tags, these cult machines do have a fair number of

admirers in India.

Post Dhoom, the Bollywood potboiler which featured John Abraham in a

Suzuki Hayabusa, this small community of high-power bike aficionados is

growing with every passing day. To import a brand new bike, one will have to

pay 105 percent duty and 100 percent on a used one. The Exim Policy 2001 lifted

quantitative restrictions on the import of second-hand vehicles.

The import of vehicles shall be subject to the following guidelines of the

Government of India:

1 (I) A new imported vehicle shall mean a vehicle that: -

Has not been manufactured/assembled in India; and

Has not been sold, leased or loaned prior to importation into India; or

Has not been registered for use in any country according to the laws of that

country, prior to importation into India.

1. (II) The import of new vehicles shall be subject to the following conditions:

The new vehicle shall-

Have a speedometer indicating the speed in km / h;

Have right hand steering, and controls (applicable on vehicles other than two and

three wheelers);

Have photometry of the headlamps to suit "keep-left" traffic; and

Be imported from the country of manufacture.

(b) In addition, the new vehicle shall conform to the provisions of the Motor

Vehicles Act, 1988 and the rules made there under, as applicable, on the date of

import.

(c) The import of new vehicles shall be permitted only through the Customs port

at Nhava Sheva (Mumbai), Calcutta and Chennai.

2. (I) A second hand or used vehicle shall mean a vehicle that :-

Has been sold, leased or loaned prior to importation into India; or

Has been registered for use in any country according to the laws of that country,

prior to importation into India;

2. (II). The import of second had or used vehicles shall be subject to the following

conditions:-

The second hand or used vehicle shall not be older than three years from the date

of manufacture;

The second hand or used vehicle shall:

Have right hand steering, and controls (applicable on vehicles other than two and

three wheelers);

Have a speedometer indicating the speed km / h; and

Have photometry of the headlamps to suit "keep left" traffic.

In addition, the second hand or used vehicle shall conform to the provisions of the

Motor Vehicle Act, 1988 and the rules made there under, as applicable, on the

date of import.

Import of second hand vehicles shall be allowed only through the customs port at

Mumbai.

The second hand or used vehicles imported into India should have a minimum

roadworthiness for a period of 5 years from the date of importation into India with

assurance for providing service facilities within the country during the five year

period. For this purpose, the importer shall, at the time of importation, submit a

declaration indicating the period of roadworthiness in respect of every individual

vehicle being imported, supported by a certificate issued by any of the testing

agencies, which the Central Government may notify in this regard.

The vehicle has to be submitted for testing to Vehicle Research and Development

Establishment (VRDE), Ahmednagar, of the Ministry of Defence or the

Automotive Research Association of India, Pune or the Central Farm and

Machinery Training and Testing Institute, Budni, Madhya Pradesh, and such other

agencies as may be specified by the Central Government, for granting a certificate

by that agency as to the compliance of the provisions of the Motor Vehicles Act,

1988 and any rules made there under.

SWOT Analysis

A scan of the internal and external environment is an important part of

the strategic planning process. Environmental factors internal to the firm usually

can be classified as strengths (S) or weaknesses (W), and those external to the

firm can be classified as opportunities (O) or threats (T). Such an analysis of the

strategic environment is referred to as a SWOT analysis. SWOT analysis of the

Indian automobile sector gives the following points:

Strengths:-

Large domestic market

Sustainable labor cost advantage

Competitive auto component vendor base

Government incentives for manufacturing plants

Strong engineering skills in design etc

Weaknesses:-

Low labor productivity

High interest costs and high overheads make the production uncompetitive

Various forms of taxes push up the cost of production

Low investment in Research and Development

Infrastructure bottleneck

Opportunities:-

Commercial vehicles: SC ban on overloading

Heavy thrust on mining and construction activity

Increase in the income level

Cut in excise duties

Rising rural demand

Threats:-

Rising input costs

Rising interest rates

Cut throat competition

Industry present and future trends:-

Automobile is one of the largest industries in global market. Being the

leader in product and process technologies in the manufacturing sector, it has been

recognised as one of the drivers of economic growth. During the last decade, well¬-

directed efforts have been made to provide a new look to the automobile policy for

realising the sector's full potential for the economy. Steps like abolition of licensing,

removal of quantitative restrictions and initiatives to bring the policy framework in

consonance with WTO requirements have set the industry in a progressive track.

Removal of the restrictive environment has helped restructuring, and enabled industry

to absorb new technologies, aligning itself with the global development and also to

realise its potential in the country. The liberalisation policies have led to continuous

increase in competition which has ultimately resulted in modernisation in line with

the global standards as well as in substantial cut in prices. Aggressive marketing by

the auto finance companies have also played a significant role in boosting automobile

demand, especially from the population in the middle income group.

Evolution of Two-wheeler Industry in India:-

Two-wheeler segment is one of the most important components of the automobile

sector that has undergone significant changes due to shift in policy environment. The

two-wheeler industry has been in existence in the country since 1955. It consists of three

segments viz. scooters, motorcycles and mopeds. According to the figures published by

SIAM, the share of two-wheelers in automobile sector in terms of units sold was about 80

per cent during 2003-¬04. This high figure itself is suggestive of the importance of the

sector. In the initial years, entry of firms, capacity expansion, choice of products

including capacity mix and technology, all critical areas of functioning of an industry,

were effectively controlled by the State machinery. The lapses in the system had invited

fresh policy options that came into being in late sixties. Amongst these policies,

Monopolies and Restrictive Trade Practices (MRTP) and Foreign Exchange Regulation

Act (FERA) were aimed at regulating monopoly and foreign investment respectively.

This controlling mechanism over the industry resulted in: (a) several firms operating

below minimum scale of efficiency; (b) under-utilisation of capacity; and (c) usage of

outdated technology. Recognition of the damaging effects of licensing and fettering

policies led to initiation of reforms, which ultimately took a more prominent shape with

the introduction of the New Economic Policy (NEP) in 1985.

However, the major set of reforms was launched in the year 1991 in response to

the major macroeconomic crisis faced by the economy. The industrial policies shifted

from a regime of regulation and tight control to a more liberalised and competitive era.

Two major results of policy changes during these years in two-wheeler industry were that

the, weaker players died out giving way to the new entrants and superior products and a

sizeable increase in number of brands entered the market that compelled the firms to

compete on the basis of product attributes. Finally, the two-¬wheeler industry in the

country has been able to witness a proliferation of brands with introduction of new

technology as well as increase in number of players. However, with various policy

measures undertaken in order to increase the competition, though the degree of

concentration has been lessened over time, deregulation of the industry has not really

resulted in higher level of competition.

A Growth Perspective:-

The composition of the two-wheeler industry has witnessed sea changes in the

post-reform period. In 1991, the share of scooters was about 50 per cent of the total 2-

wheeler demand in the Indian market. Motorcycle and moped had been experiencing

almost equal level of shares in the total number of two-wheelers. In 2003-04, the share of

motorcycles increased to 78 per cent of the total two-wheelers while the shares of

scooters and mopeds declined to the level of 16 and 6 per cent respectively. A clear

picture of the motorcycle segment's gaining importance during this period is exhibited by

the Figures 1, 2 and 3 depicting total sales, share and annual growth during the period

1993-94 through 2003-04.

National Council of Applied Economic Research (NCAER) had forecast two-

wheeler demand during the period 2002¬-03 through 2011-12. The forecasts had been

made using econometric technique along with inputs obtained from a primary survey

conducted at 14 prime cities in the country. Estimations were based on Panel Regression,

which takes into account both time series and cross section variation in data. A panel data

of 16 major states over a period of 5 years ending 1999 was used for the estimation of

parameters. The models considered a large number of macro-economic, demographic and

socio-economic variables to arrive at the best estimations for different two-wheeler

segments. The projections have been made at all India and regional levels. Different

scenarios have been presented based on different assumptions regarding the demand

drivers of the two-wheeler industry. The most likely scenario assumed annual growth rate

of Gross Domestic Product (GDP) to be 5.5 per cent during 2002¬-03 and was

anticipated to increase gradually to 6.5 per cent during 2011¬-12. The all-India and

region-wise projected growth trends for the motorcycles and scooters are presented in

Table 1. The demand for mopeds is not presented in this analysis due to its already

shrinking status compared to' motorcycles and scooters.

It is important to remember that the above-mentioned forecast presents a long-

term growth for a period of 10 years. The high growth rate in motorcycle segment at

present will stabilise after a certain point beyond which a condition of equilibrium will

set the growth path. Another important thing to keep in mind while interpreting these

growth rates is that the forecast could consider the trend till 1999 and the model could not

capture the recent developments that have taken place in last few years. However, this

will not alter the regional distribution to a significant extent.

Table 1 suggests two important dimensions for the two-¬wheeler industry. The

region-wise numbers of motorcycle and scooter suggest the future market for these

segments. At the all India level, the demand for motorcycles will be almost 10 times of

that of the scooters. The same in the western region will be almost 20 times. It is also

evident from the table that motorcycle will find its major market in the western region of

the country, which will account for more than 40 per cent of its total demand. The south

and the north-central region will follow this. The demand for scooters will be the

maximum in the northern region, which will account for more than 50 per cent of the

demand for scooters in 2011-12.

--------------------------------------------------------------

Source: Indian Automobile Industry: Optimism in the Air, Industry Insight,

NCAER

The present economic situation of the country makes the scenario brighter for

short-term demand. Real GDP growth was at a high level of 7.4 per cent during the first

quarter of 2004. Both industry and the service sectors have shown high growth during

this period at the rates of 8.0 and 9.5 per cent respectively. However, poor rainfall last

year will pull down the GDP growth to some extent. Taking into account all these factors

along with other leading indicators including government spending, foreign investment,

inflation and export growth, NCAER has projected an average growth of GDP at 6.7 per

cent during the tenth five-year plan. Its mid-term forecast suggests an expected growth of

7.4 per cent in GDP during 2004-05 to 2008-09. Very recently, IMF has portrayed a

sustained global recovery in World Economic Outlook. A significant shift has also been

observed in Indian households from the lower income group to the middle income group

in recent years. The finance companies are also more aggressive in their marketing

compared to previous years. Combining all these factors, one may visualise a higher

growth rate in two-wheeler demand than presented in Table 1, particularly for the

motorcycle segment.

There is a large untapped market in semi-urban and rural areas of the country.

Any strategic planning for the two¬-wheeler industry needs to identify these markets with

the help of available statistical techniques. Potential markets can be identified as well as

prioritised using these techniques with the help of secondary data on socio-economic

parameters. For the two-wheeler industry, it is also important to identify the target groups

for various categories of motorcycles and scooters. With the formal introduction of

secondhand car market by the reputed car manufacturers and easy loan availability for

new as well as used cars, the two-wheeler industry needs to upgrade its market

information system to capture the new market and to maintain its already existing

markets. Availability of easy credit for two-wheelers in rural and smaller urban areas also

requires more focussed attention. It is also imperative to initiate measures to make the

presence of Indian two-wheeler industry felt in the global market. Adequate incentives

for promoting exports and setting up of institutional mechanism such as Automobile

Export Promotion Council would be of great help for further surge in demand for the

Indian two-wheeler industry.

Major firms in an industry:-

Major players in the two wheeler automobile sector (India):

Hero Honda motors ltd.

Bajaj auto ltd.

TVS motors company ltd.

Yamaha motors India

Honda motorcycle and scooters India

Royal Enfield

Suzuki Motors

LML

Basic Data of Sector:-

Broad product range

Over the last decade, the two wheeler automobile sector has successfully

changed its image. Its product range encompasses Scooterettes, Scooters and

Motorcycles. The main product ranges of two wheeler automobile sector are as

follows:

Scooters

Motorcycles

Scooterettes

Hero Honda Motors Limited:-

Hero Honda Motors Limited was established in 1984, as a joint venture

between India's Hero Group (world's largest bicycle manufacturers) and Japan's

Honda Motor Company. In 1985 production began with the launch of its first

motorcycle, the CD100, which gave 80 km to the liter. In 1987 the engine plant

was started and in 1989 the Company produced its 3,00,000th motorcycle. In

2001 Hero Honda manufactured its 50,00,000th motorbike. Hero Honda has a

reputation of being the most fuel-efficient and the world's single largest two

wheeler Company. Shri Brijmohan Lall Munjal is the chairman and managing

director of this Company.

As early as in 1960’s very few Indian bicycle manufacturers were

interested in exports. However, the hero groups foray into the overseas markets in

1963 pioneered Indian exports in the bicycle segment. It was more prompted

essentially by the need to remain attuned to the global marketplace. While initial

exports were restricted to Africa and the middle east, today more than 50% of the

exports from Hero Cycles Ltd. Meet the demands of sophisticated markets in

Europe and America. This is primarily because of appropriate product

development and excellent quality that hero offers..

Hero Honda has grown like no other company in the auto business.

Several times in the path, savvy observers have insisted that it has grown just too

big and that no company its size can continue to show growth rates. But Hero

Honda has ignored that opinion and continued growing at the place it has set

many years ago.

Hero Honda today faces more competitor than it has ever in the history.

Now that is the undisputed two wheeler Numero Uno in the country. Every single

two wheeler manufacturer in India if looking market share away from it. More

over for the first time there are so many four- stroke challengers in the market.

And Hero Hondas best selling products are ageing.

Corporate Profile:-

The joint venture between India's Hero Group and Honda Motor

Company, Japan has not only created the world's single largest two wheeler

company but also one of the most successful joint ventures worldwide.

During the 80s, Hero Honda became the first company in India to prove

that it was possible to drive a vehicle without polluting the roads. The company

introduced new generation motorcycles that set industry benchmarks for fuel thrift

and low emission. A legendary 'Fill it - Shut it - Forget it' campaign captured the

imagination of commuters across India, and Hero Honda sold millions of bikes

purely on the commitment of increased mileage

Over 19 million Hero Honda two wheelers tread Indian roads today. These

are almost as many as the number of people in Finland, Ireland and Sweden put

together!

Hero Honda has consistently grown at double digits since inception; and

today, every second motorcycle sold in the country is a Hero Honda. Every 30

seconds, someone in India buys Hero Honda's top -selling motorcycle – Splendor.

This festive season, the company sold half a million two wheelers in a single

month—a feat unparalleled in global automotive history.

Hero Honda bikes currently roll out from two globally benchmarked

manufacturing facilities based at Dharuhera and Gurgaon in Haryana. These

plants together are capable of churning out 3.9 million bikes per year. A third

state of the art manufacturing facility at Hardwar in Uttranchal will soon be

commissioned to cope with sustained customer demand.

Hero Honda's extensive sales and service network now spans over 3000

customer touch points. These comprise a mix of dealerships, service and spare

points, spare parts stockiest and authorized representatives of dealers located

across different geographies.

Hero Honda values its relationship with customers. Its unique CRM initiative -

Hero Honda Passport Program, one of the largest programs of this kind in the

world, has over 3 million members on its roster. The program has not only helped

Hero Honda understand its customers and deliver value at different price points,

but has also created a loyal community of brand ambassadors.

Having reached an unassailable pole position in the Indian two wheeler

market, Hero Honda is constantly working towards consolidating its position in

the market place. The company believes that changing demographic profile of

India, increasing urbanization and the empowerment of rural India will add

millions of new families to the economic mainstream. This would provide the

growth ballast that would sustain Hero Honda in the years to come. As Brijmohan

Lall Munjal, the Chairman, Hero Honda Motors succinctly points out, "We

pioneered India’s motorcycle industry, and it's our responsibility now to take the

industry to the next level. We'll do all it takes to reach there.''

Mission statement:-

Hero Honda’s mission is to strive for synergy between technology, systems

and human resources, to produce products and services that meet the quality,

performance and price aspirations of its customers. At the same time maintain the

highest standards of ethics and social responsibilities.

This mission is what drives Hero Honda to new heights in excellence and

helps the organization forge a unique and mutually beneficial relationship with all

its stake holders.

HERO HONDA'S MANDATE:-

Hero Honda is a world leader because of its excellent manpower, proven

management, extensive dealer network, efficient supply chain and world-class

products with cutting edge technology from Honda Motor Company, Japan. The

teamwork and commitment are manifested in the highest level of customer

satisfaction, and this goes a long way towards reinforcing its leadership status.

Registered & Corporate Office:-

34, Community Centre Basant Lok, Vasant Vihar New Delhi - 110057Tel.: +(91)-(11)-26142451 - 59 Fax: +(91)-(11)-26143321 / 3198 / 1830; 26152453 / 2132

Work Station:- 69 Km Stone New Delhi-Jaipur Highway Daruhera - 121106, Haryana

Since 1986, there is a technical tie-up of Bajaj Auto Ltd. with Kawasaki

Heavy Industries of Japan to manufacture state-of-art range of latest two-wheelers

in India. The JV has already given the Indian market the KB series, 4S and 4S

Champion, Boxer, the Caliber series, and Wind125

Bajaj Auto Ltd.

Kawasaki Heavy Industries is a Fortune 500 company with a turnover of

USD 10 billion (Rs. 45,840 crore). It has crafted new technologies for more than

hundred years. The technologies of KHI have redefined space systems, aircrafts,

jet engines, ships, locomotive, energy plants, automation system, construction

machinery, and of course high reliability two-wheelersKHI has given the world its

legendary series of 600-1200cc Ninja and 1600 Vulcan bikes. Straight from its

design boards, the Kawasaki Bajaj Eliminator, India's first real cruiser bike,

redefines the pleasure of "biking" in looks as well as performance.

Corporate Profile

'Inspiring Confidence,' the tagline, has build up confidence, through

excitement engineering, not only to domestic consumers but also internationally.

Established just eight decades back in 1926 by Jamnalal Bajaj, the company has

been vested with India's largest exporter of two and three wheelers, 196,710 units

in 2004-05, a great 26 per cent jump over the previous year.

Bajaj Auto Ltd. sales have increased by approximately 21 per cent in the

year 2004-05, which exceeds Rs 65.4 billion, a record in the history of the

company. The gross operating profit stands at Rs. 9.3 billion, again a record. The

profits after tax of the BAL are close to Rs. 7.7 billion, and the pre-tax return on

operating capital is at an impressive 80 per cent.

The strength of the company is its quality products, excellence in

engineering and design, and its ability to delight the customers. The Pulsar,

introduced in November 2004, is continually dominating the premium segment of

the motorcycle market, helping to maintain the market superiority. Discover

DTSi, one more successful bike on Indian roads, is in the 'value' segment of the

motorcycle market. It incorporates a high degree of power with fuel efficiency of

a 100 cc motorcycle.

BAL is committed to prevention of pollution, continual improvement of

environment performance and compliance with all environmental legislation and

regulations. They always believe in providing the customer 'value for money' and

keep an special eye upon quality, safety, productivity, cost and delivery.

BAJAJ AUTO’S MISSION:-

We at Bajaj Auto continue to firmly believe in providing the customer

Value for money, for years through our products and services. This we shall

maintain and improve,

In our decision making, quality, safety and service will be given as much

consideration as productivity, cost and delivery. 

Quality shall be built into every aspect of our work life and business

operations. Quality improvements and customer satisfaction shall be the

responsibility of every employee.

REGISTERED OFFICE:-

ADDRESS: Akurdi, Pune – 411035, India

TELEPHONE: + (91)-(20)-27472851

FAX: + (91)-(20)-27473398

E-MAIL: rahulbajaj@bajajauto.co.in

WEDSITE: http://www.bajajauto.com\

PLANTS:-

Akurdi, Pune 411035

Bajaj Nagar, Waluj Aurangabad 431136 .

TVS Motors Ltd.:-

Profile:-

TVS Motors Company, a leading two wheeler company began with the

vision of the founder of the Sundaram Clayton Group, the late T.S. Srinivasan -

'to design, develop and produce an affordable moped for the Indian family.

This vision was realized in 1980 when TVS 50, India's first two-seater

moped rolled out of the factory at Hosur in Tamil Nadu, Southern India. A

byword for ruggedness and reliability, the TVS 50 proved to be a promising

success and paved the way for many successes for TVS Suzuki ever since.

TVS, the first in the country to introduce computerization, achieve high

productivity, low cost and consistent high quality, now included extensive

programme to install computers at all workstations.

Background

Originally incorporated in 1982 to manufacture two-wheelers in

collaboration with Suzuki Motors of Japan, TVS was one of the leaders in two-

wheeler industry. However, disagreement on several aspects including

development of TVS brand and exports lead to severance of ties with the joint

venture partner in 2002. This forced the company to develop its own R&D

expertise and commit itself to sizeable investment. It has presence in all the

segments viz. motorcycle, scooterettee and moped. TVS Scooty (scooterettee) and

TVS Victor (Executive segment - motorcycle) are its key brands. The company

has also launched 2 new fuel-efficient bikes - `Centra' and `Star'.

Vision

Our vision is the creation of an India which is a global destination for

innovative product development and thought leaders in integrated product and

process development with a focus on improving the quality of life, including that

of the poorest of the market segments at the bottom of the pyramid.

Mission

Our mission is to improve the capabilities of people engaged in the design

and development of new products and services, to encourage innovation in

product development and effective management of the product development

processes.

HONDA MOTORCYCLE & SCOOTER INDIA (Pvt.) Ltd.

Honda is the world's largest manufacturer of 2-wheelers. Its symbol, the

Wings, represents the company's unwavering dedication in achieving goals that

are unique and above all, conforming to international norms. These wings are now

in India as Honda Motorcycle & Scooter India Pvt. Ltd. (HMSI), a wholly owned

subsidiary of Honda Motor Company Ltd., Japan. These wings are here to initiate

a change and make a difference in the Indian 2-wheeler industry. Honda's dream

for India is to not only manufacture 2-wheelers of global quality, but also meet

and exceed the expectations of Indian customers with outstanding after sales

support.

About Honda Motorcycle & Scooter India Pvt. Ltd.

Official Name Honda Motorcycle & Scooter India Pvt. Ltd.

Established 20th Aug, 1999

Place Manesar, District Gurgaon, Haryana, India

Investment Rs. 300 Crore

Representative Mr. Shinji Aoyama, President & CEO

Factory Location Manesar, District Gurgaon, Haryana, India

Production Capacity 10,000,00 Units per Year

Honda's dream for India is to not only manufacture 2-wheelers of global

quality; but also meet and exceed the expectations of Indian customers with

outstanding after sales support. They aim to produce technologically superior,

efficient and reasonably priced 2-wheelers, with Honda tested technology, backed

up with after sales service of Honda's global standard.

CORPORATE PROFILE

Honda Motor Co., Ltd., operates under the basic principles of "Respect for

the Individual" and "The Three Joys"-commonly expressed as The Joy of Buying,

The Joy of Selling and The Joy of Creating. Respect for the Individual" reflects

our desire to respect the unique character and ability of each individual person,

trusting each other as equal partners in order to do our best in every situation.

Based on this foundation of Respect for the Individual, "The Three Joys"

expresses our belief and desire that each person working in, or coming into

contact with our company, directly or through our products, should share a sense

of joy through that experience.

In line with these basic principles, since its establishment in 1948, Honda

Motor Co., Ltd., has remained on the leading edge by creating new value by

providing products of the highest quality at a reasonable price, for worldwide

customer satisfaction. In addition, the Company has conducted its activities with a

commitment to protecting the environment and enhancing safety in a mobile

society.

The Company has grown to become the world's largest motorcycle

manufacturer and one of the leading automakers. With a global network of 454*

subsidiaries and affiliates accounted for under the equity method, Honda

develops, manufactures and markets a wide variety of products ranging from

small general-purpose engines and scooters to specialty sports cars, to earn the

Company an outstanding reputation from customers worldwide.

Mission Statement

Maintaining a global viewpoint, we are dedicated to supplying products of the

highest quality at a reasonable price for worldwide customer satisfaction.

HONDA MOTORCYCLE & SCOOTER INDIA (Pvt.) Ltd.

Plot No. - 1, Sector - 3 IMT Manesar,

Distt. Gurgaon

Haryana - 122 050

Phone: + 91 - 124 -6290911, 6290919, and 6290926-28

Fax: +91 - 124 - 6290891, 6290890

HONDA MOTORCYCLE & SCOOTER INDIA (Pvt.) Ltd.

406, Level Four, Prestige Centre Point

Edward Road

Bangalore 560 046

Phone : +91 - 80 - 2282419, 2384090, 2384091

Fax : +91 - 80 - 2282409

Head Office:

2-1-1 Minami Aoyama, Minato-ku Tokyo 107-8556, Japan

Tel: +81-(0)3-3423-1111

Yamaha Motor India (YMI)

Holding the true spirit of commitment to customer satisfaction - Yamaha

Motor India is enriching lives of people with the same ingenuity and enthusiasm

as its parent company - Yamaha Motor Corporation, Japan. Having operated in

India as technology provider for almost two decades, YMI was incorporated in

August 2001 as a 100'% subsidiary of YMC, Japan. Since then we have been in

the process of redefining our business processes and extending the awe and power

associated with the legacy of the Yamaha Group.

Adhering to our Corporate Mission - "Creating Kando - Touching Your

Heart" we are striving to touch every Heart across the length and breadth of India

We firmly believe in “Surpassing Customer Expectations”

We are aware of our customers' evolving needs and provide them with quality

products and services of exceptional value that surpass their expectations.

Establishing a Corporate environment that fosters self-esteem

We believe in nurturing and empowering our employees to the fullest.

Whilst cultivating our employees’ creativity and all round abilities, we have also

established an equitable system of evaluation and rewards to encourage our

people to strive towards newer benchmarks.

Fulfilling social responsibilities

As a good corporate citizen, we continually strive towards creating a better social

as well as natural environment.

Vision and Mission:

We conduct our corporate activities with customer satisfaction as our top

priority.

Our clients in the Yamaha Motor group and many companies outside the group

are mostly manufacturers that are involved in programs to improve the full range

of their business activities, from product manufacturing, distribution and sales to

financing, administration, and corporate governance. We are striving to help these

clients achieve a higher level of satisfaction for people using their products.

Toward this end we are actively expanding our business in Japan and worldwide.

At Yamaha Motor Solutions we are working to become a world-class leader in

our field by bringing together the accumulated abilities and skills our individual

employee's into dynamic teams capable of creating value that surpasses the

expectations of our clients.

Corporate Profile

Name: Yamaha motors ltd.

Location: 2000-1 Iwai, Iwata City, Shizuoka Pref.

Post Code: 438-0016

Telephone: 0538-39-2213 Facsimile:

0538-39-2219

Board of director: President and Representative

Director@Yasuharu TerIai

Director: Takuya Watanabe

Tetsuro Nabata

Mitsuyoshi Suzuki

Takeya Harada

Employees: 245 (As of January, 2006)

Sales: 4.5 billion yen (As of FY ended

December, 2005)

6 billion yen (Projected FY ending

December, 2006)

Offices: Head office (Iwata City, Shizuoka

Pref.)

Iwata Office (Iwata City, Shizuoka

Pref.)

Overseas subsidiary Yamaha Motor Solutions Co., Ltd.

Xiamen (Location: Amoy City, Fujian

Prov.)

Yamaha Motor Solutions India Pvt. Ltd.

(Location: Surajpur (UP state), India )

Exports:-

YMI is an active player in the exports market. Currently, we export

motorcycles to 50 countries including Argentina, Mexico, Philippines,

Bangladesh, Sri Lanka, Columbia, Dominican Republic, Nigeria and lvory Coast.

The export Product line boasts of RX 100, Crux, YD 125, Enticer and LiberoI.

To consolidate our position in the exports arena, we are rapidly expanding

our presence in Asia, Africa, Central and South America.

Strengthening our reputation as an export base for YMC global operations, we are

bright and optimistic about our emergence as a top-notch bike exporter of India.

Inference:-

Out of 100%:

45% customers are using Hero Honda two wheeler

30% customers are using Bajaj two wheeler

14% customers are using TVS two wheeler

5% customers are using Honda two wheeler

6% customers are using Yamaha two wheeler

Inference:-

Out of 100%:

65% respondents want to purchase pulsar

15% respondents want to purchase apache

13% respondents want to purchase CBZ

5% respondents want to purchase unicorn

2% respondents want to purchase gladitor

Firms or Company strategies :-

Two-wheeler segment is one of the most important components of the

automobile sector that has undergone significant changes due to shift in policy

environment. The two-wheeler industry has been in existence in the country since

1955. It consists of three segments viz. scooters, motorcycles and mopeds. In

India there are some MNC’s and Indian company dealing in automobile sector.

The main key players who are dealing in this sector are Hero Honda, Bajaj,

Yamaha, Honda, and TVS. Hero Honda is the biggest player in this sector in India

as well as in the world and playing a very important role in two wheeler

automobile sector. Hero Honda, Bajaj and TVS are the Indian companies and

Yamaha & Honda are international automobile brand.

.

Hero Honda Motors Limited was established in 1984, as a joint

venture between India's Hero Group (world's largest bicycle manufacturers) and

Japan's Honda Motor Company. And created the world's single largest two

wheeler company and also one of the most successful joint ventures worldwide.

During the 80s, Hero Honda became the first company in India. Over 19 million

Hero Honda two wheelers running on Indian roads today.

Bajaj is the first Indian two wheeler automobile company in the

market since 1945 with the name M/s Bacharj trading corporation private limited.

In 1959 M/s Bacharj trading corporation private limited change its name as Bajaj

Auto Ltd. Bajaj Auto obtains license from the Government of India to

manufacture two- and three-wheelers vehicles in 1959

TVS Motors is the third largest company in the two-wheeler industry

with a market share of 16%. Infect, it is the only Indian company without a

foreign collaboration in the two-wheeler industry. When the company opted out

of the collaboration with Suzuki in 2002, many believed that TVS was headed

towards extinction. But the company proved the doomsayers wrong and came out

with a very successful `TVS Victor'. TVS Motors Ltd. originally incorporated in

1982 to manufacture two-wheelers in collaboration with Suzuki Motors of Japan,

TVS was one of the leaders in two-wheeler industry.

Yamaha Motor Corporation is the auto mobile company of

Japan (1953) which works in India since 1955 and providing latest technology in

India from last two decades. Yamaha Motor India was incorporated in august

2001 as a 100% subsidiary of Yamaha motor corporation, Japan

Honda motors of Japan is not a new name in the two wheeler

scenario in the country, they were in a tie up with the Firodias owned Kinetic

group. However in the late 90s they parted ways after problems arose over issues

like introduction of new models, advertising expenditure, marketing strategies and

other related issues. In the mid 80 Honda motors of Japan joined hands with the

largest bicycle maker of India the Hero cycles to create Hero Honda which in a

couple of decades or so have gone on to become the single largest motorcycle

company in the world. Though Honda has come on its own on the Indian market

yet it will be providing technological support to Hero Honda for the next ten

years. Thus presenting a unique situation in which the company will be in direct

competition with the company which it has been associated for nearly two

decades. Honda Motorcycles and Scooters India limited, a 100% subsidiary of

Honda motor company Japan eventually entered the Indian market with Honda

Unicorn in 2004.

CHAPTER-III DESIGN OF THE STUDY

Objective of Study:

The main objective is to find out the current trend going on in the industry

i.e. (about the product, piece, place and promotion). Other objectives are as

follows:

To know the image of product in the mind of consumer.

To compare the level of satisfaction before purchasing and after

purchasing the bike.

To find out where people want to see the promotion schemes

To find out suitable location and preferred by consumer

To know the most popular media for advertisement

To check the loyalty of the consumer towards the Hero Honda brand

To know the most motivating factor for purchasing the bike

To know the preferable price from the customer

Scope:-

Today, India is well known as a potential emerging automobile market and jobs in

the automobile industry are rising. Several foreign companies have their investments in

Indian automobile industry. India is the major three-wheeler market and two-wheeler

manufacturer in the world. It is also the second largest manufacturer of tractors.

India is a home to many Indian and international automobile companies. The

candidates who have achieved bachelor's degree in mechanical, electrical or automobile

engineering are eligible to get good jobs in these companies.

Automobile Jobs Opportunities:-

Many job opportunities are available for the candidates with diploma courses and

ITI courses. Some of the automobile companies require IT specializations. The technical

education is offered by plenty of engineering and polytechnic colleges in India. The

eligible candidates are selected by the companies and then trained properly. Considering

the wide scope of Automobile sector, it is not surprising that more and more candidates

are dreaming to develop a career in Automobile Industry. Now, with so many foreign

automobile companies like Volkswagen, Audi, Renault etc targeting India as a base for

manufacturing cars, the scope for a career in Automobile Industry is rising rapidly.

Aut

omobile companies in India:-

As automobile industry is showing rapid growth in India, the country becomes a

house to numerous well-established automobile companies. They offer excellent job

opportunitiesto develop a career in Automobile Industry. Some of the popular car-

producing companies that offer jobs in the automobile industry are- Suzuki, Toyota, Tata,

Fiat, Honda, Mahindra & Mahindra, Ford, Hyundai and Skoda. Manufacturing of two-

wheelers is dominated by the companies TVS, Bajaj Auto, LML, Kinetic, Yamaha and

Hero Honda. The tractors are manufactured by the popular companies like Escorts, L&T,

Mahindra & Mahindra, Punjab Tractors, John-Deere, New IHolland and ITL-Renault.

Methods of data collection:-

The whole secondary data were collected from industry profile, books, magazines

and internet. While primary data where collected though survey. The customer survey

was done though the questionnaire. Question consists of dichotomous multiple questions

and 5 point ranking scale. A copy of questionnaire has been attached with the report.

Source of data

There two types of data, primary data and secondary data. Primary data

are collected with the help of questionnaire are secondary data was taken from

industry profile, books, magazines and internet.

Data analysis :-

Limitation of the study:-

Despite all possible efforts in conducting the research there was some

unavoidable situation, which limited the scope of this dissertation. The limitations

of the dissertation fall under the following:-

1. This dissertation is confined on the basis of secondary data collected only

hence it reliable data for the study.

2. As the research is based on the data that already available and collected

through various means not includes the survey, hence it imposes limitations,

as it is just possible that the secondary data may be unsuitable or may be

inadequate in the context of the topic under study.

3. One of the major limitation of the study is that, as the data is collected though

the secondary means, hence it creates uncertainties regarding the methods of

the data collection, time of data collected, and any bias of the compiler during

the pervious research and at the time of data collection.

4. Limitation of time & resources were a major factor influencing the research

study.

5. The research guide has helped us though at the project study, yet his busy time

schedule restricted as to cut short our discussions though detailed discussions

were required for the project.

CHAPTER - IV DATA ANALYSIS

Data analysis & interpretation:-

CHAPTER-V

Findings:-

Suggestions:-

No matter how much on organization progresses it always lack something.

These are shortcoming of every company. After completing my report on new

Hero Honda motors Ltd. I have some suggestions to offer. The suggestions can be

proved useful for the company as they have feasibility and viability.

The recommendations are:-

Hero Honda Motors only manufacture a wide rand of 4-stroke bike. But in

my opinion 2-stroke bikes have a better pick up. So in order to letter to the

need of a large segment of customers, who want a better pick up bike,

Hero Honda go into the manufacture of 2-stroke bikes.

The company has always targeted urban sector of Indian population. But

in the rural sector escorts; Rajdoot enjoys a great market share. So,

therefore Hero Honda should target this upcoming market.

Hero Honda should keep a strict watch on to competitions. For instance

Yamaha has introduced a 4-stroke bike “YBK” whose features are almost

same as Splendors.

The company should work more on public relation.

Conclusions:-

The study which we conducted on the two wheeler automobile sector is a

very important topic of automobile sector.

Two wheeler automobile sector is the backbone of the automobile sector

in India. After deep research, analysis and getting information about companies as

formulated that the two wheeler automobile companies achieved success in the

market.

Through out the study we found the Two wheeler manufacturer having

very new and modern technology in their bikes, they have a good market share in

India, many of MNC's like Honda, Yamaha ,Suzuki are also giving large

competition.

Concluding the performance of the company related to two wheeler sector

in India, getting their market share and growth and what are services they are

providing after sales.

Hero Honda has managed to put in spectacular performance going from

strength despite increase in competition; the company's sales have witnessed an

up trend, registering an average growth of 42% in the three years under review.

Hero Honda has managed to achieve this because its strong brand image

and proven product quality underpinned the performance growth in recent years.

Apart from the strong brand "splendor" the company's performance across the

spectrum of the motorcycle market helped it exploit the growing demand for 4-

stroke motorcycle.

At the lower end the company has CD 100 SS at middle level splendor,

passion and Dawn the CBZ Extreme/ Karizma range is targeted at premium

segment.

Some years back Hero Honda are getting stiff competition because of

Bajaj, TVS and Yamaha have a presence in 125cc bikes segments where Hero

Honda has not any presence in this segment. Now this gap is filling up by Hero

Honda's new Splendor NXG, Glamour. But still there is a gap between 150cc to

225cc segment which is most preferable segment by youth today.

With newer and better models are coming up customer has better and

bigger choices to choose from.

It is the competition on various aspects such as price, design technology,

after sales services and even purchases offers, which provides to both buyer and

seller.

Even many dealers are in view that today Hero Honda and Bajaj, thrives

on competition.

Right now it seems that the real war is between Hero Honda and Bajaj

auto. But one cannot discount the fact that there are other players, who are gaining

strength day by day.

BIBLIOGRAPHY

1.We have visited in various showrooms.

2.Internet Sites:

www.bajajmotors.com

www.herohondamotors.com

www.indiabike.net.com

www.google.com

www.yahoofinance.com

www.indiaserf.com

www.honda2wheeler.com

www.yamahamotorsindia.com

www.tvsmotorsltd.com