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0 Objective (pg no1) 1 Introduction (pg no 1) 2 History (pg no 2) 3 Entry Barriers(pg no 2) 4 SWOT Analysis (pg no 3) 5 Porter’s Analysis (pg no 4) 6 Managerial Style(pg no5)
7 Hierarchy( pg no 6)
8 HR Practices(pg no 7 ) 9 Business Stratergies(pg no 8) 9a, Marketing Strategies (pg no 8) 9b, Other Strategic Issues (pg no 10) 10 Cost effective and Environmental strategies (pg no 12) 10a, Conservation of energy (pg no 12) 11 Community leadership programmes (pg no 13) 12 New projects (pgno15) 13 Profits during recession (pg no 17)
14. Performance of the company (pg no 17) 14a, Total Sales (pg no 17) 14b, Financials (pg no 18) 14c, Motorcycle sales, domestic and exports (in numbers) (pg no 18) 14d, Bajaj Auto's exports (in numbers) (pg no 18) 14e, Three-wheeler sales (in numbers) (pg no 19) 14f, Goods carriers (pg no 19) 14g, Three-wheelers (pg no 19) 14f, International Business snapshot (pg no 20) 15 Industrial relations ( pg no 20) 16 Subsidiaries (pg no 21) 17 Spare parts Division (pg no22) 18 Corporate social responsibility activities (pg no 23) 19 Awards Won by Bajaj Auto Ltd. (pg no 25) 20 Research and development (pg no 26) 21 The Future (pg no 27) 22 Recommendations (pg no 29) 23 Learning Acquired (pg no 30) 23 References (pg no 30)
managerial style etc. In 1985.000 vehicles in a single financial year. hierarchy.Pg#1 0. it obtained license from the Government of India to manufacture two. Maharashtra. . It is India's largest and the world's 4th largest two. In 1959. The company is headed by Rahul Bajaj who is worth more than US$1. In 1986. In 1970. it managed to produce and sell 500.Waluj and Patnagar in Uttaranchal.Introduction: Bajaj Auto is a major India Automobile manufacturer. the company adopted which led to it’s success.and three-wheelers and it went public in 1960. In 1977. policies. It is based in Pune. the company has successfully changed its image from a scooter manufacturer to a two wheeler manufacturer. Bajaj Auto makes and exports motor scooters.5 billion. 1.000 vehicles in a single financial year.and three-wheeler maker. 1945 as M/s Bachraj Trading Corporation Private Limited. motorcycles and the auto rickshaw.Objective: To get the information about the genesis. Over the last decade. it rolled out its ten millionth vehicle and produced and sold 1 million vehicles in a year. It’s real growth in numbers has come in the last four years after successful introduction of a few models in the motorcycle segment. it started producing at Waluj in Aurangabad. Its product range encompasses scooters and Motorcycles.and threewheelers in India. it rolled out its 100.000th vehicle. growth and the performance of the company in the recent past. It started off by selling imported two. To study the strategies. Bajaj Auto came into existence on November 29. with plants in Akurdi and Chakan (near Pune). In 1995. it managed to produce and sell 100.
Jamnalal Bajaj.72 million to Rs. founder of the group. 3. Under his leadership. took charge of the business in 1965. the group has an illustrious history.46.Pg#2 2. that he was able to give his full attention to the business. took over the reins of business in 1942. In fact. then 27. Gandhiji had adopted him as his son. The integrity. at the height of India's movement for independence from the British. . resourcefulness and determination to succeed which are characteristic of the group today. was a close confidant and disciple of Mahatma Gandhi. dedication. He too was close to Gandhiji and it was only after Independence in 1947.16 billion (USD 936 million). the turnover of the Bajaj Auto the flagship company has gone up from Rs. His son. Kamalnayan Bajaj not only consolidated the group.Entry Barriers: Entry barriers are high.its product portfolio has expanded from one to and the brand has found a global market. Rahul Bajaj.This close relationship and his deep involvement in the independence movement did not leave Jamnalal Bajaj with much time to spend on his newly launched business venture. are often traced back to its birth during those days of relentless devotion to a common cause. but also diversified into various manufacturing activities. Kamalnayan Bajaj. The present Chairman of the group.History: Founded in 1926. He is one of India's most distinguished business leaders and internationally respected for his business acumen and entrepreneurial spirit.
All these make the barrier high enough to be a deterrent for new entrants.SWOT Analysis: Let's analyze the position of Bajaj in the current market set-up. Product design and development capabilities. Still has no established brand to match Hero Honda's Splendor in commuter segment. Not a globally recognizable brand (unlike the JV partner Kawasaki) . Extensive R & D focus. The need for technical expertise is high. weaknesses. Strengths: Highly experienced management. Not a global player in spite of huge volumes. High performance products across all categories. Weaknesses: Hasn't employed the excess cash for long. evaluating its strengths. Widespread distribution network. threats and opportunities available. Owning a strong distribution network is important and is very costly. Great financial support network (For financing the automobile) High economies of scale.Pg # 3 The market runs on high economies of scale and on high economies of scope. High economies of scope. 4. High export to domestic sales ratio.
The growing gearless trendy scooters and scooterette market. This instinct of the industry is primarily driven by the technical capabilities acquired over years of gestation under the technical collaboration with international players. .Porter’s Five Forces Analysis: Supplier Bargaining Power: Suppliers of auto components are fragmented and are extremely critical for this industry since most of the component work is outsourced. Industry Rivalry: The industry rivalry is extremely high with any product being matched in a few months by competitor. Growing world demand for entry-level motorcycles especially in emerging markets. More maturity and movement towards higher-end motorcycles. 5. the market forces have empowered the buyers to a large extent. Threat of cheap imported motorcycles from China. Untapped market above 180 cc in motorcycles. Proper supply chain management is a costly yet critical need.Pg #4 Threats: The competition catches-up any new innovation in no time. Buyer's Bargaining Power: Buyers in automobile market have more choice to choose from and the increasing competition is driving the bargaining power of customers uphill. Opportunities: Double-digit growth in two-wheeler market. Margins getting squeezed from both the directions (Price as well as Cost) TATA Ace is a serious competition for the three-wheeler cargo segment. With more models to choose from in almost all categories.
The three CEO’s will be responsible for Top line. Business Growth & profitability of their respective businesses. Cars.Engineering. will now be President. Mktg. has emphasised a lot on organizational restructuring for the Auto business. Also. India’s premier automotive company. These pillars will be supported by functions of Finance. will now head the Two Wheeler Business Unit as CEO with manufacturing operations at Waluj and Akurdi also reporting to him. Pradeep Srivastava. As per the reorganized structure the company will have three CEO’s. Bajaj has presence in it. who was VP-Engineering prior to restructuring.Pg#5 Substitutes: There is no perfect substitute to this industry. With this restructuring. MIS. Managerial Style: Off late Bajaj Auto Limited. The five pillars of this new structure (Strategic units) are R&D. and Commercial Vehicles Business Unit & International Business Unit. 6. S. HR. The company is in the process of identifying a CEO for its International Business. & Sales TwoWheelers. Business Development and Commercial. RC Maheshwari has joined Bajaj Auto as CEO Commercial Vehicles. VP. Engineering. cycles do never even compete with the low entry level moped for even this choice comes at a comparatively higher economic potential. . the existing business roles and responsibilities at the company has been strengthened and enhanced to ensure greater operational empowerment and effective management. Sridhar. Abraham Joseph will continue to lead Research & Development. which again are a mode of transport. do never directly compete or come in consideration while selecting a two-wheeler. currently. Two Wheeler Business Unit. if there is any substitute to a two-wheeler.
BFSL) Company Secretary . Managing Director. Sridhar Chairman Vice Chairman Managing Director Executive Director President (New Projects) President (Research & Development) President (Engineering) CEO (2WH) CEO (Commercial Vehicles) CEO (International Business) Vice President (Corporate) Vice President (Commercial) Vice President (Finance) CEO (Operations. and Perfection (Distinctly).Pg #6 Mr. “The new structure would assist in “Aligning the Vectors” of the organization and will enable the company to live its Brand Values & be “Distinctly Ahead”. Said. The objective of this is to transit from relatively narrow functional definitions into more integrated and cross-functional working with clear focus on business results (Ahead) as well as focus on our Brand Values of speed. Hierarchy: Rahul Bajaj Madhur Bajaj Rajiv Bajaj Sanjiv Bajaj Eric Vas Abraham Joseph Pradeep Shrivastava S Sridhar R C Maheshwari Rakesh Sharma C P Tripathi N H Hingorani Kevin P D'sa V S Raghavan S Ravikumar K Srinivas Ranjit Gupta J. Innovation. Rajiv Bajaj.” 7. BHIL) Vice President (Business Development) Vice President (Human Resources) President (Insurance. Bajaj Auto Ltd.
the Company will select a business partner belonging to a socially disadvantaged section of society. This Code of Conduct for Affirmative Action will be put up on the company web-site to encourage applications from socially disadvantaged sections of society. The Company's selection of business partners is not based on any considerations other than normal business parameters. It further believes that inclusive growth is a component of growth and development of the country. HR Practices: The Company affirms that its competitiveness is interlinked with the well being of all sections of the Indian society. The Company affirms the recognition that diversity to reflect socially disadvantages sections of the society in the workplace has a positive impact on business.Pg#7 8. The Company does not bias employment away from applicants belonging to disadvantaged sections of society if such applicants possess competitive skills and job credentials. The Company will not practice nor support conscious discrimination in any form. No discrimination of any type will be shown in this process. The Company makes all efforts for up skilling and continual training of all its employees in order to enhance their capabilities and competitive skills. In case of equal business offers. The Company believes that equal opportunity in employment for all sections of the society is a component of its growth and competitiveness. The Company may have a partnership programme with educational institution/s to support and aid students from socially disadvantaged .
Target was the rural population and the price sensitive customer. to oversee and promote the Affirmative Action policies and programmes. The Company will maintain records of Affirmative Action. Vice President (HR). The time at which Kawasaki 4S was launched Hero Honda was the market leader in fuel-efficient bikes and Yamaha in the performance bikes. etc. BAL adopted different marketing strategies for different models. The target customer was the father in the family but the target audience of the commercial was the son in the family. He will be accountable to the Chairman.It took the reins from where the Kawasaki 4S left. . The Company has nominated Mr K Srinivas. 9.First attempt by bajaj to make a mark in the motorcycle segment. BAL has been the pioneer in stretching competition into providing latest features in the price segment by updating the low price bikes with the latest features like diskbrakes. high ground clearance and high mileage were the selling factors and it was in direct competition to Hero Honda Dawn and Suzuki MX100. Most of the Bajaj models come loaded with the latest features within the price band acceptable by the market. few of them are discussed below: Kawasaki 4S . Boxer . The Company will make available its learning and experiences as a good corporate citizen in Affirmative Action to other companies desiring to incorporate such policies in their own business. Business Stratergies: 9A. Boxer marketed as a value for money bike with great mileage. anti-skid technology and dual suspension. Larger wheelbase. Marketing Strategies: The focus of BAL off late has been on providing the best of the class models at competitive prices.Pg#8 sections of society.
Bajaj has kicked off a project to completely restructure the company's retail network and create multiple sales channels. the company will set-up separate sales channels for every segment of its business and consumers. Bajaj Auto's entire product portfolio. Bajaj could realize its success riding on the back of technological innovation rather than the joint venture way followed by competitors to gain market share.The same DTSI technology of Pulsar extended to 125 cc Discover was a great success. So. And though Bajaj made the bike look bigger and feel more powerful than its predecessor (characteristics that will attract the average. selling. The model was a great success and has already crossed 1 million mark in sales. The needs of financing. Going by the initial market response. Bajaj Auto also plans to set-up an independent network of dealers for the rural areas. The campaign beared innovative punch line of "Definitely Male" positioning Pulsar to be a masculine-looking model with an appeal to the performance sensitive customers. The Pulsar went one step ahead of Hero Honda's 'CBZ' and launched a twin variant of Pulsar with the 180 cc model. The restructuring will involve separate dealer networks catering to the urban and rural markets as well as its three-wheeler and premium bikes segments. the campaign was clearly a hit in the 5-10 years age bracket. Over the next few months.The focus for the Caliber 115 was youth. The company also plans to set-up exclusive dealerships .Pulsar was launched in direct competition to the Hero Honda's 'CBZ' model in 150 cc plus segment. Pulsar . picking them from the clique of three agencies that do promos for the company (the other two being Leo Burnett and O&M). executive segment bike buyer). the teaser campaign and the emphasis on the Caliber 115 being a `Hoodibabaa' bike placed it as a trendy motorcycle for the college-goers and the 25 plus executives both at the same time. Discover . its approach towards advertising is even more radically different this time around. Bajaj gave the mandate for the ad campaign to Lowe. distribution and even aftersales service are completely different in the rural areas and do not makes sense for city dealers to control this. 25-plus. is being sold by the same dealers. BAL now is taking a leaf out of the FMCG business model to take the company to greater heights. from the entry-level to the premium.Pg#9 Caliber . With this.
Bajaj Auto will need its cash muscle. There is a hint of a buyback of shares of the investment company as this is the only way it can be delisted. To fight this battle and retain its hard-earned market share in the motorcycle segment. 9b. Stake for Kawasaki: Bajaj Auto's attempt to vest the surplus cash in a separate company may be a prelude to offering a stake to Kawasaki of Japan in the equity of the automobile company. A combination of a large one-time dividend and a regular buyback program through the tender route may offer better value. . and its brand name is also more visible in Bajaj bikes than in the past. This would be closing the valve of equitable ownership distribution. Delisting worry: What is worrying is that there is an idea to delist the investment company (also an indirect indication that it would be listed initially). Factors such as low valuation. A look at its own story over the past five years provides valuable insight. competition in the two-wheeler market is set to intensify.Other Strategic Issues: Cash is strength: Bajaj Auto has been sitting on a cash pile for over five years now. A strategic stake for Kawasaki would only positively influence the stock's valuation. low trading interest and the need to provide shareholders may be cited as plausible reasons for the buyback. Strategies for the Overseas Markets:Bajaj Auto looks at external markets primarily with three strategies: 1) A market where all BAL need to do is distribute through CKD or CBU routes.Pg#10 for its three-wheeler products instead of having them sold through an estimated 300 of its existing dealers. The company would not be short of cash to put through such a buyback. Better value proposition: Shareholder interests may be better served if the cash is retained to pursue growth in a tough market. Over the next couple of years. This would also obviate the need to fork-out fancy sums as stamp duty to the government for the demerger. The latter has been playing an increasingly active role in Bajaj's recent models. TVS Motors and Hero Honda are on a product expansion binge.
most of the products that Bajaj exported were scooters and some motorcycles. which hold potential. The two signed an MoU in February. It also wants to develop a new step-through model for the Indonesian market. BAL should look at the right product mix for two-wheelers. Earlier. 3) Markets where BAL need to enter with existing products and probably with a good distributor or a production facility or a joint venture. Bajaj has also made a beginning by selling bikes in the Philippines branded in the name of its technical partner. The other market. which constitute the third biggest consumer of two-wheelers. which would be a focus area. the largest market. in the Philippines. Kawasaki. 60 per cent of its exports were twowheelers and the rest three-wheelers. the shift was towards motorcycles. in its target markets. where Bajaj distributors are looking to introduce ecofriendly four-stroke auto rickshaws. developed by both companies.Pg#11 2) Markets where BAL need to create new products. Its first overseas office established at the Jebel Ali free trade zone has been the focal point for exports to middle Africa and the Saharan nations. a large multi-product conglomerate. Kawasaki and some Korean and Chinese models. close to 90 per cent were motorcycles. The Bajajdeveloped models. Bajaj has identified certain key markets. However. only makes high-end bikes and does not have sub-200cc models. Wind 125. The biggest among them is Indonesia. it had a better offering to export. There's Suzuki. like in India. Caliber and Byke. Kawasaki. For the last fiscal. Bajaj's Pulsar model has taken off well there. Of the two-wheeler exports. With the expansion in Bajaj's own range to almost five-six platforms of motorcycles. which is a fuel-efficient bike. where the company feels it is fairly well represented in most countries. Egypt and Iran also continue to be strong markets for Bajaj. The company recently participated in a large auto exhibition in Brazil and found good consumer acceptance to products like Pulsar and Wind 125. also the reason for its stronger showing. But two-wheeler market requires great deal of effort from BAL. Everybody is there with Honda leading the show. is South America.The other focus area is the ASEAN nations. except in Brazil. are also being . but for now it will create a base there with its motorcycle models. Kawasaki is marketing the new model.
fan less cooling towers for AC plants. optimisation of loading pattern in CGC and seal quench . Variable Frequency Drives (VFD) for ASUs in paint shops.Pg#12 distributed by Kawasaki. use of LED & CFT street lights. and LPG saving was achieved by installation of waste heat recovery system for hot water generation used in pre-treatment process of paint shop. energy efficient screw compressors by replacing CPT compressors. washing machine blowers. drip irrigation system for gardening. high efficiency reflector fittings with electronic ballasts tube lights. three-wheeler electro-deposition (ED) painting process changed from Acrylic ED to Cathodic ED. rain water harvesting and use of bio-chemical additives to reduce frequency of water change in various paint processes. Water saving was achieved by replacement of old under-ground water pipes with aboveground pipes to avoid water wastage through leakage. This is a good beginning strategically for Kawasaki to evince interest in Bajaj products for markets which can still buy less than 150 cc. usage of treated water for bin washing and paint shop process. 10. replacement of 350 W air circulators by 180 W air circulators. compressors etc and rationalisation of pumping hours of main pump as well as booster pump of pump house. real timer electrical circuits installed to switch off electrical equipments during lunch / tea breaks and during non utilisation of production equipments.Conservation of energy: As a part of continuing efforts to conserve various resources. following steps were taken to conserve energy Electrical energy saving was achieved by installation of localised portable air compressors at various shops during low production periods. use of reflective coating inside furnaces for better heat retention. installation of localised fresh water storage systems. 150 W MH lamps instead of 250 W HPSV lamps at shop floors. Cost effective and Environmental strategies: 10a.
9.24. the employees volunteered for blood donation camp at Deenanath Mangeshkar Hospital. Pantnagar Fire fighting teams of the company along with vehicles responded to 20 Fire assistance calls from Government Fire Department / other industrial units outside the factory premises in the larger interests of saving invaluable life and property. the company has effected an overall reduction in consumption as under:Reduction achieved in: 2008-09 % Electrical energy Water LPG 23 11 44 2007-08 % 23 16 12 Investment / savings: Investment for energy conservation activities: Saving achieved through above activities: Rs. .2 million 11.Pg#13 furnaces. Impact of measures taken: As a result of the initiatives taken for conservation of energy and natural resources. Pune and Dr Susheela Tiwari Hospital.35 million Rs. start-up losses in ovens and hot water generation plants and changed design of paint jigs to reduce jig stripping frequency. use of biogas for cooking in canteens. reduction of hot water temperature for pre-treatment. Community leadership programmes: During the year.
it is the company's endeavour that the employees. Health: Government of India. Apart from two doctors and six supporting medical staff. whether as employee or entrepreneur. who have accepted voluntary retirement scheme.900 numbers and the unit is recognised today as one of the best . Many dignitaries from Global Fund. the ART centre has added audio-visual facilities for group counseling.National Aids Control Organisation (NACO) and CII have initiated Public Private Partnership (PPP) in order to provide better healthcare to AIDs patients. in addition to lump sum compensation announced. considering the various options available today. Pune with the cooperation of Pimpri Chinchwad Municipal Corporation for HIV patients. They were also provided with options of taking loans at competitive rates of interest. who opted for voluntary retirement at the Akurdi Plant. as a result of which the ART centre registration has reached 1. are independently self-sustaining and can take good care of their families. WHO and such other organisations have visited the ART centre. By these actions. Soon after the Akurdi employees expressed their interest in accepting the Voluntary Retirement Scheme. the company organised a series of interactive meetings with leading financial institutions. Employees were also guided for alternative possibilities. The officers explained the need to prudently and safely invest the monies received. it showes sensitivity to the employees.Ministry of Health and Family Welfare .Pg#14 Community Care: In line with the commitment to enrich the life of all with whom bajaj deals. which is the largest unit run by an industry under Public Private Partnership programme. The company devised attractive schemes for interested employees so that they could receive regular monthly payments. Your company has signed a tripartite MoU with NACO and Yeshwantrao Chavan Municipal Hospital (YCMH) in Pimpri to set up an Anti Retroviral Treatment Centre (ART Centre) at YCMH in Pimpri.
NABARD will partner with JBGVS for a Rs. candle and paper dish production. are under re-design. JBGVS aims at an integrated development of 43 selected villages. sanitation.3. dance. nursery education. . watershed development. healthcare. JBGVS undertook a number of development initiatives viz. women empowerment etc. Rural and community development activities and empowerment of women. to sharpen the competitive positioning of the products. It also initiated various income generation programmes. Samaj Seva Kendra (SSK) as part of JBGVS provides facilities for social development of the residents of Akurdi. both in Passenger and Cargo segments of the Industry. sports. The trust supported construction of low cost houses and latrines. New projects: Chakan 4-wheeler plant-The 'Lite' range of 4 wheeler vehicles. Nigdi and adjoining townships. music. through skill development training. cultural programmes etc. Through JBGVS encouragement and technical assistance. It encouraged and facilitated entrepreneurship development through projects. conducted tests and provided treatment during the HIV / AIDs awareness programmes. 4 educated youths installed cultivation facilities under polynet and 32 farmers have established WADI concept mango groves of 20 trees each. 12. The company continued with its rural development activities in Pune and Aurangabad districts of Maharashtra through its trust. to be carried out by the villagers under their own leadership and through united efforts forged by local organisations with JBGVS acting as a catalyst.Pg#15 ART centres in the country. shops and stalls etc. health care. hobby centre. with the aim of improving their quality of life. basic education. like goat rearing.50 crore WADI Project for the next seven years. HIV / AIDs awareness and prevention. supporting 50 self-help groups women members and developed 400 vermicompost plots. During the year. Jankidevi Bajaj Gram Vikas Sanstha (JBGVS).
R & D has enhanced its internal competencies by installation of advanced machines in proto shop and introduction of special equipments in testing areas.9 1.187. Total research and development expenditure as a percentage of sales. Capital (including technical know-how) ii.0 1.37 . which has enabled it to make the new generation products.4 NA 1.8 837. The Techno-economic feasibility for the Passenger 4 wheeler will be evaluated by Bajaj Renault-Nissan for a final decision. leading to firming up of the co-operation parameters among partners and a suitable JV Agreement. net of excise duty 310.4 706. The expenditure on research and development during 2008-09 and in the previous year was: Rs In Million 2008-09 2007-08 i.36 NA 1. company continues to focus on expanding its design & testing teams. Recurring iii.Pg#16 The Cargo version code named ' PV 1500' is likely to be launched in 2011.7 481.148.
529 2.) Motorcycles Other two-wheelers Total Two wheelers Three wheelers Total Two & Three wheelers Of the above. the company has succeeded in maintaining an operating EBITDA (earnings before interest. the Euro zone. depreciation and amortisation) margin of 13. Performance of the company: 14a.154 2007-08 (Nos. Profits during recession: 2008-09 has been a tumultuous year for the global economy. Companies have got re-rated.5% or thereabout in 2008-09.from 9% in 2007-08 to an expected 6. exports were 1.6% of net sales and other operating income. Despite falling demand in the motorcycle segment. it has witnessed a 250 basis point compression in growth rate . cut down capacities.) 2.Total Sales: 2008-09 (Nos.139. the UK and Japan.853 11.407 . The year began with a continuation of a world-wide inflationary spiral and ended with the worst slowdown since the Great Depression of the 1930s.451. It is in this context that one must look at the performance of Bajaj Auto Limited (Bajaj Auto'. and had to borrow funds at prohibitive interest rates.919.772 1. delayed payments to vendors.907. While India did not face a contraction in GDP growth like the USA.194.Pg#17 13.095 290.316 2. BAL or the Company').779 21.625 274.312 2. have scrapped investment plans and capital expenditure. struggled with finances because of their earlier overleveraged positions. The second half of 2008-09 has seen severe financial distress across broad sections of Indian industry-especially the manufacturing sectors. 14. taxes.161.
379 2.0% 0.8% 14. In Million 2008-09 2007-08 89.056 772.026 136.7% 28.3% 14.9% 24.908 32.463 Growth 31 .519 482.140 1.Pg#18 Two wheelers Three wheelers Total Exports 633.806 Sales growth BAL (nos.Bajaj Auto's exports (in numbers): Product Total two-wheelers 2007-08 482.218 6.323 91.9% 41.140 14.162 Net sales & other income Gross profit before exceptional items. Millions) 3.024 1. interest & depreciation 14c.026 2008-09 633.4% (10.Financials: Rs.5% (7.201 7.Motorcycle sales.8%) Sales growth: Source: SIAM and Company data:14d.912 2.1%) (10.100 6.341 14b. Millions) BAL's growth BAL's market share 23.7% 27.8% 33.9% 20.317 5.1% 23.450 1.3% 17.0% 2003 2004 2005 2006 2007 2008 2009 31.8%) 4.688 13. domestic and exports (in numbers): Year Ended 31st March Salse (nos.5% 32.8% 30.463 139.757 4.544 6.868 1.315 618.6% 31.9% 18.
Three-wheeler sales (in numbers): 2007-08 Passenger vehicle sales: Industry sales Bajaj Auto sales Bajaj Auto market share 14f.8%) (8.4%) (2.826 26.3% (6.3%) 130.Pg#19 Three-wheelers Total vehicles 136.793 274.0%) (61.3% 415.1% (1.7% 0.6% 10.4 billion.598 70.056 772.341 139.315 618. . representing a growth of 29%.4% 82.312 57.26.382 10.4% 497.006 290.529 55.411 264.197 12.714 20.332 63.Three-wheelers: Industry sales Bajaj Auto sales Bajaj Auto market share 506.519 2 25 The total value of exports was Rs.Goods carriers: Industry sales Bajaj Auto sales Bajaj Auto market share 14g.180 263. 14e.6%) (5.4% (37.7%) 2008-09 Rate of growth Source: SIAM and Company data.0%) 375.
Chakan . 2.Industrial relations: At Akurdi. Subsequently. Bajaj Auto has a market share in excess of 90% in the permit-driven markets. with a view to downsizing the workforce at Akurdi.Pg#20 The heartening news for this segment is that state governments have increased the permits for plying energy efficient three-wheelers. which will have a high mileage. 13f. Relations with staff and workmen across the plants at Akurdi. the benefits of the settlement have been given to all dailyrated employees at Akurdi. in conciliation and accordingly. Voluntary Retirement Scheme was floated for the permanent dailyrated workmen. 15.331 workmen availed of the benefit under the scheme. the management signed the wage settlement on 18 July 2008 with Vishwakalyan Kamgar Sanghatana. and will attempt to capture a larger share of the rural market. accommodate more passengers with a luggage hold area. the recognised union. Waluj. The company also intends to introduce a RE Diesel upgrade in 2009-10.
000 during 2007-08. 830. Bali and Sulawesi islands. subscribed and paid-up capital of Euros 200. PT BAI assembles and markets Bajaj Pulsar and Bajaj XCD in Indonesia. Bajaj Auto Indonesia (PT BAI). sales and service network reach have been expanded substantially covering the major cities of Jawa. product range and reach towards becoming a strong player in this market currently dominated by Japanese 2-wheeler majors. Bajaj Auto International Holdings BV. Netherlands (BAIHBV) -was incorporated as a wholly owned subsidiary company in Netherlands with an issued. PT BAI plans to expand its presence. Sumatara. which are planned in the coming years.562 million) in 2006-07.Subsidiaries: PT. .5 million (Rs. Total showroom strength stands at around 63 numbers. with balance being held by a local partner. Bajaj Auto holds 97.7 million as on 31 March 2009. Further capital of Euro 98.2 million was invested in this company during the previous year. Through the efforts. covering 46 cities of Indonesia. It is proposed to make strategic investments in overseas ventures. by way of premium. subscribed & paid-up capital of US$ 12. During the year under review. was incorporated as a subsidiary company in Indonesia with an issued. 16. by way of equity shares and / or loans and to undertake related activities through this company. establishing Bajaj as a high quality tech-savvy brand.Pg#21 and Pantnagar remained cordial. it is expected that PT BAI will turn around within a reasonable time. The subsidiary company has accumulated losses of Rs.5% shares in this company.
45 billion. Bajaj Auto created a separate channel exclusively for distribution of spare parts in 2004-05. who cater directly to over 15. Spare parts Division: Automobiles need periodic replacement of parts. This is a high volume.88 billion in 2008-09.Pg#22 17. maintain vehicle goodwill' across different geographies. despite significant expansion of Bajaj Auto's authorised service network. and contribute to the bottom-line. The objectives of spare parts business of Bajaj Auto are to perform an effective role in supporting new vehicle sales. Today.1. The results demonstrate the success of the channel.000 retail shops across the country. These translate into three goals: * Make spare parts available to customer at all time. There is huge head room for further growth of this business. the channel has 73 distributors.5. * Achieve profitable business growth and greater penetration.and the business opportunity . Even today. the challenge . * Make them affordable. And exports rose by 84% to Rs. more than 70% of the services during post-warranty period happens in the neighbourhood private garages. . To do so. credit intensive business that requires mastery over the supply of heterogeneous products. Hence. Domestic sales of spare parts grew by 17. The company's spare parts business has done well. This channel now accounts for over 70% of total spare parts sales of BAL. makes and consumer groups.is to make the company's spare parts available in not only the authorised service centres but also the private garages and spare part shops that dot the country. and the data suggests that there is still scope for significant growth. therefore. Not surprisingly.5% to achieve a revenue of Rs. spare parts comprise a profitable business for major automobile manufacturers.
The company believes strongly that its competitiveness is interlinked with the well being of all sections of Indian society and that equal opportunity for all sections of the society is a component of its growth and competitiveness. one student with a brilliant academic record was identified from the underprivileged and low-income group.200.000 3. Corporate social responsibility activities: During the year. who can afford coaching for entrance to IITs.000 900.960.000 900.000 2008-09 1.860.200.Pg#23 Table 4: Bajaj Auto's plant-wise capacities (in units): Plant Waluj Chakan Pantnagar Total 2007-08 1.000 3. the company has volunteered to adopt 3 ITIs (Industrial Training Institute) for up-gradation: . Education: The company has launched a programme that would help SC/ST students achieve academic excellence and make them on par with those.960. Under the central government initiative of Public Private Participation (PPP). The company continues to place emphasis on inclusive growth and has put in place certain processes for delivering the intended social outcome in measurable terms.000 1. The company is constantly endeavouring to ensure that no discrimination of any type is shown to the socially disadvantaged sections of the society in the work place. the company continued affirmative action and corporate social responsibility initiatives in various fields.000 18. for reimbursement of complete fees for the preparation of IIT entrance test under the guidance of IITians Prashikshan Kendra.860. During the year under review.000 1.
was the first and only company to launch ecologically friendly CNG engines for three wheelers in Delhi. Instructors and staff of the Institutes. A detailed individual action plan was set by each participant for further action by themselves.Pg#24 * ITI Mulshi . The trust oversees integrated development of twenty four villages adjoining the . reiterating that a happy workforce is a productive workforce.The Central Government has approved the Institute Development Plan. This was done to 'open the minds' to 'aim high' and receive better ideas and go out and achieve excellence. Further developmental actions are currently underway. The construction of a new building at Pirangut is in an advanced stage and is expected to be occupied by June 2009. * ITI Haveli . a registered charitable trust and a society. * ITI Ramnager near the Pantnagar Plant (Uttarakhand) .A Memorandum of Agreement and Institute Development Plan are awaiting approval by the central government and funds are expected in the financial year 2009-10. health. Bajaj Auto promotes several welfare programmes for its employees as well as various initiatives related to environment. education and rural development in the communities around the plant areas. The other activities include: Bajaj Auto Ltd. The Institute Management Committee has received the funds for the up-gradation.A Memorandum of Agreement and Institute Development Plan are awaiting final clearance from the central government. The company supports these initiative through the Jankidevi Bajaj GramVikas Sanstha. The company organised a two day training program for the Principals. The company has been committed to its social and environmental responsibilities both within and outside the company.
increased productivity of land. The latest to confer the award. etc. committing funds for awareness campaigns against HIV/AIDS.Pg#25 locations of BAL factories in Pune and Aurangabad. taking initiatives to promote HIV/AIDS awareness among employees and other community members. BS Motoring awarded the coveted Bike Of The Year award to Wind 125. CNBC-Auto Car Award gave the "Two Wheeler of The Year Award" again to Wind 125. education. The activities are centered around improvement of natural resources. has started contributing toward the fight against AIDS in various ways. health. sanitation and income generation programmes. Bajaj Auto Ltd. 19. empowerment of women. including committing funds for medicines for AIDS victims. framing non-discriminatory policies regarding HV/AIDS and providing victims with a support system in the workplace.signals the changing face of Bajaj and its endeavour to offer .NFO Customer satisfaction and CNBC-Auto Car Auto Awards. While ICICI Bank-OVERDRIVE bestowed three awards to Bajaj under various categories including the Bike Maker of the year. The rapid fire winning of awards by Bajaj Auto for almost all its product range from the entry level Boxer. the leading international marketing research firm awarded Bajaj Pulsar for Motorcycle Total Customer Satisfaction in the premium segment. the most coveted awards in the industry. to the newly launched Wind 125 as well as for the DTSi technology . NFO. were all showered on Bajaj Auto. providing free condoms. Awards Won by Bajaj Auto Ltd: Bajaj Auto Ltd. is also a member of the Prince of Wales International Business Leaders Forum and Business and Community Foundation. Bajaj AutoLtd. had several bountiful years with awards galore across its product line. BBC World Wheels showered four awards including the viewer choice 2wheeler of the year to Pulsar 180 DTSi.
executive and premium segments. Product Award Award Body Business Standard Motoring CNBC AUTOCAR AUTOAWARDS 2004 ICICI Bank OVERDRIVE Awards 2004 ICICI Bank OVERDRIVE Awards 2004 ICICI Bank OVERDRIVE Awards 2004 BBC World Wheels Bajaj Wind 125 Bike of the Year 2004 Bajaj Wind 125 Two Wheeler of the Year 2004 Bajaj Pulsar DTS-i Bike of the Year 2004 DTS-i Technology Auto Tech of the Year 2004 BAJAJ AUTO Bike Maker of the Year 2004 Bajaj Boxer AT BBC World Wheels Award for Best KTEC Two Wheeler under Rs 30. which started as a trickle in 2001 has now become a deluge.Pg#26 technologically superior products across the entry.000 BBC World Wheels Award for Best Bajaj Pulsar 180 Two Wheeler between Rs 55. The winning of awards.000 BBC World Wheels Award for Best Bajaj Pulsar 150 Two Wheeler between Rs 45.000 DTS-i to Rs 55.000 DTS-i to Rs 70.000 Bajaj Pulsar 180 BBC World Wheels Viewers Choice DTS-i Two Wheeler of Year 2003 Motorcycle Total Customer Bajaj Pulsar Satisfaction Study 2003 Bajaj Pulsar Bajaj Pulsar Bike of the Year 2003 BBC World Wheels BBC World Wheels BBC World Wheels NFO Automotive ICICI Bank OVERDRIVE Awards 2003 Business Standard Motoring OVERDRIVE OVERDRIVE OVERDRIVE Bike of the Year 2002 Most Exciting Bike of the Year Bajaj Pulsar 2002 Bajaj Eliminator Bike of the Year 2002 Bajaj Eliminator Most Exciting Bike of the Year .
Sweden. the company has also been investing heavily in the latest. Bajaj leads Colombia with 65% of the scooter market.2001 20. The Future: Although the avalanche of motorcycles offered Indian consumers a wide variety of models to choose from. 21. Several new models are being developed specifically for global markets and with these the company will progressively endeavor to establish its presence in Europe too. Italy. Colombia. The countries where their products have a large market are USA. Peru. Research and development: Bajaj Auto has a huge. Iran and Egypt. and development of eco-friendly automobile technologies. Bangladesh. Sri Lanka. they have built their distribution network over 60 countries worldwide and multiplied the exports from 1% of total turnover in Fiscal 1989-90 to over 5% in Fiscal 1996-97. technology enhancements and up- . extensive and very well-equipped Research and Development wing geared to meet two critical organizational goals: development of exciting new products that anticipate and meet emerging customer needs in India and abroad. While the manpower strength of the R&D represents a cross-section of indepth design and engineering expertise. Argentina. Bajaj Auto R&D also enjoys access to the specialized expertise of leading international design and automobile engineering companies working in specific areas. it also resulted in increased pressure on the companies to concentrate on cost-cuts. in Uruguay with 30% of the motorcycle market and in Bangladesh with 95% of the three-wheeler market. Germany. sophisticated technologies to scale down product development lifecycles and enhance testing capabilities. Based on their own brand of globalization.
Their margins came under pressure as marketing costs escalated. There was little differentiation between the brands being launched apart from styling as most companies had introduced their four-stroke vehicles. followed by the moderately growing moped segment and the restructuring in the scooter segment with major national and foreign players reinforcing their presence. it was unlikely that the entire growth in the two-wheeler sector would be due to motorcycles. the segment would have to completely cannibalize the market for scooters and a considerable part of the market for scooterettes and mopeds. there was room for a profitable existence for all brands. the survival prospects of many of the individual brands were deemed to be rather bleak. Moreover. the survival of indigenous brands looked uncertain. Analysts also commented that as the two-wheeler industry had grown steadily for eight years. Despite the launch of more vehicles.Pg # 28 gradations and styling. Further. Considering the fast growing scooterettes segment. Constrained with the ruling price levels in the market place. analysts were skeptical about the segment's ability to maintain the growth rate in the years to come. With the failure of the joint ventures. there were over 30 motorcycle brands in the market. only 40% of the market was available for all other new brands put together. the growth in the motorcycle segment was dependant on continuing favourable market conditions. stringent emission norms and threat from major international players. the expected introduction of cheaper Chinese brands. One of the major assumptions underlying the motorcycles rush was that if the market was considerably large and was growing at a constant pace. In 2001. with high demand from female customers. rather than later and the decline stage would invariably come some day. However. stages in the product life cycle would apply to the field sooner. with the top five brands accounting for more than 60% of the market. The companies were forced to reduce prices and offer discounts to survive the competition. Analysts claimed that to sustain this growth rate. limited infrastructure and lack of .
remains to be seen. Avenger. ( compete with models like Honda Activa) The company needs to tap the export market more efficiently as there is a huge potential to make India as the world's two-wheelers production base. The advertising should have a fresh look and the product should live up to the Gen-X's expectations. Low margin products . Recommendations: Focus on High Margin Products: Around 50% of the two-wheeler consumers buy high quality products (products of executive and premium segment motorcycles).Pulsar. High margin products . Three-wheelers. Scooters. Below are other recommendations: Company should keep focusing on the fast growing motorcycle segment. whether the Indian companies would succeed in generating the kind of volumes needed to sustain in the competitive motorcycle market.Pg#29 technological innovations when compared to their foreign counterparts. Mopeds. For this. and a couple of brands on lowerend of motorcycles (To grab the market share) and scooters segment.Platina. In view of the new threat posed by Honda Motors in the scooter segment. . it needs to look for joint ventures abroad. The company needs to take a look at its ungeared scooters offerings and need to adapt to the latest trends. It needs to target the young age group more effectively as this group is extremely trend savvy. Margins on these products are higher. the company needs to review its products line-up and launch new products to cater the changed demand. Discover. Now with increasing competition in the economy segment and limited scope from cost saving measures. BAL should adopt a deliberate strategy of focusing on executive and premium segment motorcycles and three-wheelers. 22. it is believed this strategy of focusing on higher margin products would enable the company in retaining its operating margins.
com http://www. References: www.prdomain. 23.Pg #30 Learning Acquired: Able to understand that how the concepts that I have learnt from the book were used in the corporate world and how the companies are flexible enough to change according to their business requirements ( i.com/india/news/bajaj-auto-revampsorganisational-structure/ http://www.coolavenues.bma. How the policies and the structures change).ac.html http://www.org/csr500companies/csr500companies_7373.bajajauto.org http://www.in/KnowledgeCentre/index1.ht m www.com/know/gm .wikipedia.com/companies/B/BajajAuto http://www.karmayog.business-standard.e.
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