Industry & Firm Analysis

Presented by: Group 3

Industry Scenario

13% 3%3%

81%

Market sharePassenger vehicle Commercial Vehicle3-Wheeler 2-Wheeler

• India is largest producer of 2 Wheelers in the world (23 Million vehicles in 2015)

• The “Indian Two - Wheeler Industry” accounts for 81% by volume of the “Indian Automobile Industry”

The two wheeler segment comprises of the following:• Motorcycles (100cc to 650cc) –

Our Industry boundary• We exclude Scooters (100cc) as

Bajaj has exited this segment.“We are not making scooters. For that, we need to earn the right to make them and for that I need to be No. 1 in motorcycles.” - Rajiv Bajaj

Industry Boundary:

PEST Analysis

Political• 100% FDI• Make in India• Eco-Friendly

Vehicles• AMP (2006–

16)

Economic • Automobile

sector targets 10% of GDP by 2016

• ED reduction in Budget 14-15

Social• Lifestyle• Social status• Demography• Social

Technological

• Increase in power

• >100 kmpl• Reduction in

overall costs• Style &

Design• Innovative

Features

1945 -1960• 1945- M/S Bachraj

Trading• 1948- Import of

Vehicles• 1959- Manufacturing

Licence• 1960- Public Limited

1961-1980• 1970- Produced

100000th vehicle• 1972- Bajaj Chetak• 1975-JV with

Maharashtra Scooters• 1977- 100000unit in a

year

1980-2000• 1985- Aurangabad Plant• 1986-KB100 Motorcycle• 1991- KB 4S Champion• 1997- KB Boxer• 1998-Chakan Plant

2000-2016• 2001- Bajaj Pulsar• 2005-Bajaj Avenger DTSi,

Platina• 2010-Bajaj Pulsar 135 • 2012- tie up with Kawasaki• 2015- Pulsar 200NS• 2016- Bajaj V ‘’the invincible”

Evolution

Tackling Environmental change

Govt Banned imports and gave license to manufacture

Opened automobile sector for foreign investment

1959

1980s

Tremendous Increase in Competition .

1982

R & D investment , advertising investment

1998Joint ventures, Ex: hero honda, Kinetic motors

Increase in Production Capabilities, decrease in

demand and supply difference

1997From 20 Lakh pending order to 15 lakh models per year.

New CEO, fast restructuring and focus on new models, manufacturing processes,

supply chain, etc..

1996

Low Cost Manufacturing

1990 CHANGE WITH THE ENVIRONMENT INCREMENTAL INNOVATION

IN PRODUCT DESIGN INCREMENTAL FUEL EFFICIENT MODELS

2000- onwards

• More models available to choose

from

Industry attractiveness leading to more

competition thus more models available in

market.

Firm Analysis – Porter’s 5 Forces

Competitive Rivalry

(High)

Threat of New

Entrants (Low)

Bargaining Power of Buyers(High)

Threat of Substitut

e(High)

Bargaining Power

of Supplier

(Low)

Making it unattractive to new firms

Due to availability of other means of transport

Due to high initial costs and established players

Due to presence of high no of suppliers

Due to too many competing products

• Product Innovation• Fuel efficient models• Increased service Centres• Finance Options

• Govt. opened automobile market• Industry Attractiveness• Foreign collaborations

Resource Based ViewTangible

ResourcesIntangible Resources

Human Resources

Financial Resource

Physical Resources• Plant • Land

• Retail Footprint

• Brand

• Patents

• Technology & Innovation

• Work Culture

• Hire employee from institution like IITs, NITs, IIMs, IIFT

• Training programme for employee

• Encouraged the employee to explore the unknown

Capabilities

• Manufacturing

• Marketing

• New Product Development

• Design

VRIN ANALYSIS

V R I N

Brand

Patents

R & D

Plants

HR

Recommendations : Ansoff’s Matrix

Products

Mar

ket

Existing New

Exis

ting

New

ProductDevelopment

MarketPenetration

MarketDevelopment

Diversification

Avenger Sturdy BikesElectric Bikes

Scooters

Pulsar Quadricycle

Market share

Mar

ket g

row

th

High Low

High

Low

Question marksStars

Cash cows Dogs

Growth Share BCG Matrix

Thank You!!Q&A!