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Bajaz Auto

Bajaz Auto

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Published by Suresh Krishnan

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Published by: Suresh Krishnan on Aug 28, 2011
Copyright:Attribution Non-commercial

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08/28/2011

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IntroductionIn the mid -1940s,BAL started as an important of two ±andthree-wheelers .in the early 1960s,BAL ,in collaboration with piaggo ,startedmanufacturing vespa brand scooters at its plant near Pune , Maharashtra.In 1970s,BAL started manufacturing scooters under the Bajajbrand.Bal¶s first scooter model under the Bajaj brand wasintroduced in 1972.(Chetak)In the late 1990¶s the Indian two wheeler market witnessed ashift in consumer preferences.In 2005-06 scooter sales in the Indian market were around 1million units annually and consisted predominantly of gearless scooters. Inearly 2006 BAL announced that it would launch two new models of gearlessscooters in 2006-07.CSRBajaj Auto is committed to nation-building and contributing to the uplift anddevelopment of the weaker sections of society. This is a legacy of thefounders, Jamanalalji, Kamalnayanji and Ramkrishna Bajaj.
Jankidevi Bajaj Gram Vikas Sanstha (JBGVS)Motorcycle segment
Joint Venture: Foreign players had only option)
Many players like Honda,Suzuki,Yamaha had joint ventureswith Indian companies.
The foreign players came with latest technology, efficient production systemetc that enhance the quality of the motorcycle in India .
Soon new models come with new style, advanced technology &fuel efficient.
 
Scooter segment
LML entered into joint venture with Piaggio in 1982 , toproduceVespa, sold well in 1980s-1990s after Chetak.
1984:The Kinetic tied up with Honda ,introduced new models ,new features like self start & automatic gear transmissions.
1980-1990s :BAL dominate by Chetak & Super model with theirvalues for money appeal durability, versatility, lowmaintenance,avaliablity of spare parts ,etc.The turning pointThe Turning Point:
In 1991 & 1992 ± overall sales of two wheelers declined by15% & 8% respectively because of a recession in the Indiantwo wheeler market
The scooter segment was the largest sub-segment in the twowheeler market with 42% share (in terms of unit sales)followed by motorcycles (37%) & mopeds (21%)
However, in 1990, the pattern of demand changed &motorcycles became the fastest growing segment
Motorcycles were preferred to scooters in the rural areasbecause of poor road conditions
Demographic changes ± Increasing proportion of youngerStrengths:High economies of scale.
 
High economies of scope.Legacy of brand name. Widespread distributionnetwork.Highly experienced management.Product design and development capabilities.Extensive R & D focus. Widespread distribution network.High performance products across all categories.High export to domestic sales ratio.Great financial support network (For financing the automobile) Weaknesses:Hasn't employed theexcess cash for long.Centralized paternalisticmanagement style. Not aglobal player in spite of huge volumes.No collaboration with anyof the foreign playersHasn't employed the excess cash for long.Still has no established brand to match Hero Honda's Splendor in commutersegment.Not a global player in spite of huge volumes.Not a globally recognizable brand (unlike the JV partner Kawasaki)

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