HERO HONDA

CERTIFICATE This is to certify that TEAM B students of Maharshi Dayanand University as prepared academic report entitled Critical analysisofCUSTOMERSATISFACTION A.Under myguidance.Hehasfulfilledallrequirementleadingtoawardofthe degreeof d)thisreportistherecordofbonafide researchundertakenbyhimandnopartofithasb ersityoreducationinstitutionforawardofanyotherdegree. Iwishherallsuccessinlife Co-ordinator Faculty Guide PROF.AJAY PATOLE Hemant Sonare 1

DECLARATION We TEAM A hereby declare that, with exception of the suggestion and guidance fro m guide, Prof,Ajay Patole this project work titled CriticalanalysisofCUSTOMER SATISFA CTIONFORHEROHONDALtd This my own work. This dissertation as one, which is substantial ly the same as this has not been by me for any other examination of this univers ity or any other University Place :-Nagpur Date :- __________ MR.KAILASH SOMNATHE MR.RUPESH KUMAR MR.SUMANKANT JHA ACKNOWLEGEMENT

HERO HONDA Completing a task is never a one-man effort. It is often the result of valuable contribution of individuals in direct and indirect manner that helps in achievin g an objective. It is the indeed a great pleasure and movement of immense satisf action for me to express my profound gratitude towards my guide Prof. AJAY PATOL E of GURUGRAM BUSINESS SCHOOL, PARDI NAKA, NAGPUR , I take pride to thank him for his able guidance and time to time attention tha t was bestowed on me right for the inception to the successful completion of the project Also, my heartful thanks to all respondents and friend who directly and indirectly helped me completing this project report. I am also thankful to all such people, the name of whom haven't appeared hear but without their help this project wouldn't have been completed MR KAILASH SOMNATHE MR.RUPES KUMAR MR,SUMAN KANT JHA INDEX 3

CHPTER NO. 1 CONTENTS INTRODUCTION PAGE NO 5-9 10 2 IMPORTANCE AND OBJECTIVES 11 3 HYPOTHESIS 12 4 RESEARCH METHODOLOGY DATA ANALYSIS AND INTERPRETATION 13-14 5 15 6 7 FINDINGS AND CONCLUSION LIMITATIONS ANNEXTURE 16 BIBLIOGRAHY CHAPTER NO 1

HERO HONDA INTRODUCTION Indian Two-Wheeler Industry: A Perspective Automobile is one of the largest industries in global market. Being the leader i n product and process technologies in the manufacturing sector, it has been reco gnised as one of the drivers of economic growth. During the last decade, well-dir ected 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 l icensing, removal of quantitative restrictions and initiatives to bring the poli cy framework in consonance with WTO requirements have set the industry in a prog ressive 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 liberalisatio n policies have led to continuous increase in competition which has ultimately r esulted in modernisation in line with the global standards as well as in substan tial cut in prices. Aggressive marketing by the auto finance companies have also played a significant role in boosting automobile demand, especially from the po pulation 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 se ctor 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 con sists of three segments viz. scooters, motorcycles and mopeds. According to the figures published by SIAM, the share of two5

wheelers in automobile sector in terms of units sold was about 80 per cent durin g 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 in cluding capacity mix and technology, all critical areas of functioning of an ind ustry, were effectively controlled by the State machinery. The lapses in the sys tem had invited fresh policy options that came into being in late sixties. Among st these policies, Monopolies and Restrictive Trade Practices (MRTP) and Foreign Exchange Regulation Act (FERA) were aimed at regulating monopoly and foreign in vestment respectively. This controlling mechanism over the industry resulted in: (a) several firms operating below minimum scale of efficiency; (b) under-utilis ation of capacity; and (c) usage of outdated technology. Recognition of the dama ging effects of licensing and fettering policies led to initiation of reforms, w hich ultimately took a more prominent shape with the introduction of the New Eco nomic Policy (NEP) in 1985. However, the major set of reforms was launched in the year 1991 in response to t he major macroeconomic crisis faced by the economy. The industrial policies shif ted from a regime of regulation and tight control to a more liberalised and comp etitive era. Two major results of policy changes during these years in two-wheel er industry were that the, weaker players died out giving way to the new entrant s 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. F inally, the two-wheeler industry in the country has been able to witness a prolif eration of brands with introduction of new technology as well as increase in num ber of players. However, with various policy measures undertaken in order to inc rease the competition, though the degree of concentration has been lessened over time, deregulation of the industry has not really resulted in higher level of c ompetition. AGROWTHPERSPECTIVE The composition of the two-wheeler industry has w itnessed sea changes in the post-reform period. In 1991, the share of scooters w as about 50 per cent of the total 2-wheeler demand in the Indian market. Motorcy cle and moped had been experiencing almost equal level of shares in the total nu mber of two-wheelers.

HERO HONDA In 2003-04, the share of motorcycles increased to 78 per cent of the total twowh eelers 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 impo rtance 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 d emand during the period 2002-03 through 2011-12. The forecasts had been made usin g econometric technique along with inputs obtained from a primary survey conduct ed 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 f or the estimation of parameters. The models considered a large number of macro-e conomic, demographic and socio-economic variables to arrive at the best estimati ons for different two-wheeler segments. The projections have been made at all In dia and regional levels. Different scenarios have been presented based on differ ent assumptions regarding the demand drivers of the two-wheeler industry. The mo st 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 allIndia 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 longterm growth for a period of 10 years. The high growth ra te in motorcycle segment at present will stabilise after a certain point beyond which a condition of equilibrium will set the growth path. Another important thi ng to keep in mind while interpreting these growth rates is that the forecast co uld consider the trend till 1999 and the model could not capture the recent deve lopments that have taken place in last few years. However, this will not alter t he regional distribution to a significant extent. 7

Table 1 suggests two important dimensions for the two-wheeler industry. The regio n-wise numbers of motorcycle and scooter suggest the future market for these seg ments. At the all India level, the demand for motorcycles will be almost 10 time s of that of the scooters. The same in the western region will be almost 20 time s. 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 ce nt 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. Table 1 : Demand Forecast for Motorcycles and Scooters for 2011-12 2-Wheeler Segment Regions South West North-Central East & North-East All India Motorcycle 2835 (12.9) 4327 (16.8) 2624 (12.5) 883 (11.1) 10669 (14.0)

HERO HONDA Scooter 203 (2.6) 219 (3.5) 602 (2.8) 99 (2.0) 1124 (2.08) Note: Compound Annual Rate of Growth during 2002-03 and 2011-12 is presented in parenthesis Source: I ndian Automobile Industry: Optimism in the Air, Industry Insight, NCAER The present economic situation of the country makes the scenario brighter for sh ort-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 gro wth during this period at the rates of 8.0 and 9.5 per cent respectively. Howeve r, 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 gov ernment spending, foreign investment, inflation and export growth, NCAER has pro jected 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 recover y in World Economic Outlook. A significant shift has also been observed in India n households from the lower income group to the middle income group in recent ye ars. The finance companies are also more aggressive in their marketing compared to previous years. Combining all these factors, one may visualise a higher growt h rate in two-wheeler demand than presented in Table 1, 9

particularly for the motorcycle segment. COMPANY PROFILE OF HERO HONDA Hero is the brand name used by the Munjal brothers f or their flagship company Hero Cycles Ltd. A joint venture between the Hero Grou p and Honda Motor Company was established in 1984 as the Hero Honda Motors Limit ed At Dharuhera India. Munjal family and Honda group both own 26% stake in the C ompany. In 2010, it was reported that Honda planned to sell its stake in the ven ture to the Munjal family. During the 1980s, the company introduced motorcycles that were popular in India for their fuel economy and low cost. A popular advert ising campaign based on the slogan 'Fill it - Shut it - Forget it' that emphasis ed the motorcycle's fuel efficiency helped the company grow at a double-digit pa ce since inception. The technology in the bikes of Hero Honda for almost 26 year s (19842010) has come from the Japanese counterpart Honda [6] Hero Honda has thre e manufacturing facilities based at Dharuhera, Gurgaon in Haryana and at Haridwa r in Uttarakhand. These plants together are capable of churning out 3 million bi kes per year.[7] Hero Honda has a large sales and service network with over 3,00 0 dealerships and service points across India. Hero Honda has a customer loyalty program since 2000,[8] called the Hero Honda Passport Program Company performan ce During the fiscal year 2008-09, the company sold 3.7 million bikes, a growth of 12% over last year. In the same year, the company had a market share of 57% i n the Indian market Hero Honda sells more two wheelers than the second, third an d fourth placed two-wheeler companies put together. Hero Honda's bike Hero Honda Splendor, the world's largest-selling motorcycle for the years 2001-2003, selli ng more than one million units per year Recognition The Brand Trust Report publi shed by Trust Research Advisory has ranked Hero Honda in the 13th position among the brands in India. Motorcycle models Achiever

HERO HONDA Ambition 133, Ambition 135 CBZ, CBZ Star, CBZ Xtreme CD 100, CD 100 SS, CD Dawn, CD Deluxe, CD Deluxe (Self Start) Glamour, Glamour F .I Hunk Karizma, Karizma R, Karizma ZMR FI Passion, Passion+, Passion Pro Pleasure Splendor, Splendor+, Splendor+ (Limited Edition), Super Splendor, Splendor NXG,S plendor PRO Suppliers It is reported Hero Honda has five joint ventures or associate compani es, Munjal Showa, AG Industries , Sunbeam Auto, Rockman Industries and Satyam Au to Components, that supply a majority of its components.[14] Termination of Hero and Honda Joint Venture In December 2010, the Board of Directors of the Hero Ho nda Group have decided to terminate the joint venture between Hero Group of Indi a and Honda of Japan in a phased manner. The Hero Group of India would buy out t he 26% stake of the Honda in JV Hero Honda.[15]. Under the joint venture Hero Gr oup could not sell into international markets and the termination would mean tha t Hero Group can exploit global opportunities now. Since last 25 years the Hero Group relied on their Japanese partner Honda for R & D for new bike models. So t here are concerns that the Hero Group might not be able to sustain the performan ce of the Joint Venture alone.[16] 11

CHAPTER 2 OBJECTIVES This study has been conducted with very small sample base of around 30 responden ts in order to assess the level of satisfaction of all existing customer base th us the main objectives of the research is To assess consumer satisfaction for He ro Honda India ltd. Since Hero Honda has large number of users in the Indian mar ket. To find out what customers feel about the products offered by Hero Honda In dia ltd To gain insight into the strategies of the Hero Honda to retain its exis ting customer base as well as to attract new users in current market where large number of two wheeler player like TVS,BAJAJ are competing for lions share.

HERO HONDA CHAPTER 3 HYPOTHESIS While conducting this study we assumed that about 90%of the customers who are us ing Hero Honda bikes or other products are satisfied HYPOTHESIS-MORE THAN 90% OF THE HERO HONDA USERS ARE SATISFIED WITH THE CURRENT PERFORMANCE OF THE COMPANY PRODUCTS, 13

CHAPTER 4 RESEARCH METHODOLOGY The data collected for this project is prominently of primary nature .This was c ollected with the help of questionnaire method and interview method . For this s tudy we had made selection of 30 people who are already using the HERO HONDA BIK ES, through accidental sampling. While selecting these users we had ensured that our sample covers people from all field i.e. students, professional, business c lass people etc. All the users were asked about 10 different questions and their feedback were recorded accordingly. We asked all these questions trough structu re questionnaire which has been enclosed at the end of the report. In this way w e collected primary data. In this study we also made use of secondary data which we procured from company website, magazines ,newspapers, blogs etc. In this way we made use of both primary and secondary data for this research study.

HERO HONDA CHAPTER 5 DATA ANALYSIS AND INTERPRETATION TABLE NO 1 USERS RESPONSE FOR HERO HONDA BIKES PARAMETERS SPEED MILEAGE SITTING ARRENGEMENT BALANCE SPARE PARTS AVAILABILITY FUEL EFFICIENCY SERVICE 23 NO OF USERS 24 21 0 6 15 19 15 We have taken sample size of 30 people. weighted average Qualit ies Speed Mileag e Sitting Weig ht 25 20 5 Satisfi ed 24 21 6 weighted avg. 20 15

arrangement Balanc e Availability of spare parts Fuel efficiency Servi ce 10 10 10 20 15 19 15 23 WHILE CALCULATINJG TOTAL NUMBERS OF USERS WHO WERE SUPPOSED TO BE SATISFIED, WE MAADE USE OF WEIGHTED AVERAGE METHOD IB EXCEL GRAPH NO 1 SCALE X axis -PARAMETERS Yaxis-NO OF RESPONDENTS

HERO HONDA CHAPTER NO 6 FINDINGS AND CONCLUSION After analyzing this sat a collected through interview method we came across sev eral interesting findings .We discovered that about 20 people out of 30 people w ere satisfied with the all facilities being offered with the bikes. We found tha t about 24 people out of 30 people were satisfied with the speed of all bikes of hero Honda. For mileage we discovered that 21 people were found to be satisfied out of 30 people. As for sitting arrangement we found only 6 people were satisf ied with the way they made arrangement facilities of Hero Honda. As per table we find 15 people were dissatisfied with balance .Hero Honda really has good arran gement for delivery of their spare parts as 19 people were found to be satisfied with spare parts arrangements. Total satisfaction for fuel efficiency was good as per 15 people. And for overall services offered by Hero Honda was good for 23 people. 17

CHAPTER NO 7 LIMITATIONS while conducting this study we stumbled upon several problems these problems wer e LIMITED TIME: This study was conducted under time constraints as we had to fin ish it within 6-7 days. LIMITED MANPOWER: This study was conducted with only 3 p eople ,which we feel was really difficult to for doing this study . LIMITED SAMP LE: Practically it was not possible for us to take entire user base considering its huge subscribers In India so we have selected only 30 people for the sake of this study. LIMITED GEOGRAPHIC AREA: We conducted this study under limited geog raphic area.

HERO HONDA ANNEXTURE CUSTOMER SATIESFACTION SURVEY OF HERO HONDA Name:Occupation:Age:Gender:Q. 1) Do you use Hero Honda Bike? Yes No Q. 2) Which quality of Hero Honda do you like? a) Speed b) Mileage c) Sitting Ar rangement 19

d) Balance e) CC f) Availability of spare part g) Fuel efficiency Q. 3) Are you satisfied with service? Yes No Q. 4) What are you feeling, whether it is comfortable? Yes No BIBLIOGRAPHY We feel proud to make this report with the help of all primary and secondary dat a. As we already mentioned that we made use of QUESTIONNAIRES COMPANY WEBSITES G OOGLE TIMES OF INDIA NEWS PAPER

NOTE: WHILE ANALYZING THE DATA GIVEN IN THIS STUDY WE MADE USE OF WEIGHTEDAVERAG E METHOD WHICH WE FOUND SUITABLE HERE TO ARRIVE AT SATISFACTORY SOLUTION.