REPORT ON HYUNDAI MOTORS

Submitted by:
Shipra Uppal (MMM-B) Shashank Soni (MMM-B)

CONTENTS:

CONCEPT COMPANY PROFILE SECTOR SYNOPSIS MAJOR INDUSRY COMPETITORS PRODUCT OFFERINGS DISTRIBUTION NETWORK PRESENT AND FUTURE COMPANYS STRATEGIES LATEST FINDINGS

NAME: Hyundai Motors CONCEPT:

The Hyundai Motor Company is one if not the most dynamic automobile producer in any developing country. This is remarkable considering that the company is closing in on 40 years of existence. To outline its history one must also look into the life and times of its founder Chung Ju-Yung. It cannot be told without outlining the founders rise from the rice fields of Korea to the circumstances that let him to acquire the knowledge and determination that led to the creation of one of the fastest growing family owned businesses into a global competitor. His creation of numerous companies eventually let to the establishment of the Hyundai Group. The Hyundai Motor Company was one of these. He created it and transformed it from a mere assembler of Ford models to a designer and exporter of its own cars and engines in less than four decades. It has already become a major global player with plants and dealerships that span six continents. The company is one of the largest and most diversified business organizations with 45 affiliated domestic companies and 254 overseas companies in nearly 200 countries. The Hyundai Motor Company is but one which the Group is active in such as shipbuilding, steel, petrochemicals, heavy machinery, aerospace, electronics and financial services. 1940: The Japanese, which had occupied Korea, made it illegal for Koreans to own critical food trades as rice shops and forced Chung Ju-yung to shutdown. This led him to be a truck driver and the owner of his own delivery service. With the delivery service he gained the knowledge of repairing the trucks and this led to operate an automobile repair shop. Chung Ju- yung officially opens and establishes a garage and repair Firm, known as the Ah-do Service auto repair shop in Seoul in March 1940. 1946: Chung Ju-yung (then 31 years old) establishes Hyundai Auto Service

in Seoul, South Korea on April, 1946 and repaired trucks for the US Armed forces in South Korea.The business helped create and financed The Hyundai Civil Works Co. (known as Hyundai Togun), which was later merged into the Hyundai Engineering and Construction. Hyundai becomes the U.S. Armys favorite contractor during the Korean War. 1947: The Hyundai Group is founded by Chung Ju-yung as a construction company. The company, Hyundai Civil Works Co. is formally established on May 25, 1947. 1950: Hyundai Togun renamed into Hyundai Construction and Engineering Co. in January, after merging the Hyundai Auto Service and the Hyundai Civil Works Co. together. Hyundai Commercial Transportation Co. established in July. 1967: Hyundai Motor Company established by Chung Ju-yung and his brother Se-yung Chung on December. 1971: Chung Ju-yung becomes the Hyundai Group chairman in February. 1973: Hyundai Heavy Industries Ltd. Established in April. Hyundai enters into a licensing agreement with Giugiaros Design for body styling and design. Hyundai enters into licensing agreement with Mitsubishi for gasoline engine, transmission, rear axle designs and casting technology. 1974: Hyundai Engineering Co. and Hyundai Motor Services Co. are set up in February. Subcompact car Pony, Korea's first independently designed and manufactured model, unveiled at the 55th Turin International Motor Fair. 1976: The Pony model cars, the nations first vehicle model, are officially released in January. First Pony exported.

COMPANY PROFILE:
CEO: Mr. Chung Mong-Koo

Board of Directors:

Mong Koo Chung Dong Jin Kim Jeong- In Park Yeo Chul Youn Rudiger Grube Karry Cho Kwang-Nyun Kim Byung Park II Dong Ki Kim Masao Miyamoto Dong Kim Jeon Soo

HEAD OFFICE: Yangiae-dong, Seoul, Korea

REGIONAL OFFICES:

East: Kolkatta, West Bengal West: Mumbai

South: Chennai, North: New delhi

Chung Se-yung formed Hyundai Motor in 1967 and built it up to the company that it is today. He got his Master's Degree in political science in the United States and started his career at Hyundai Engineering and Construction Company in 1957. He was chairman of the Hyundai Group from 1996 until 1999. He died on 21st may of pneumonia. He was the brother of the founder of Hyundai Group, Chung Ju-yung. Hyundai Motor Co., formed in 1967, was a part of the large South Korean Chaebol - the Hyundai Group - until the group split in September 2000. In the last four decades, Hyundai managed to establish itself all over the world as a company producing reliable, technically sound and stylish automobiles. This company is Koreas leading automobile manufacturer employing over 68,000 people worldwide. Hyundai ranks as the sixth largest automotive manufacturer in the world. Hyundai's 6th manufacturing unit outside the parent country is also the group's largest overseas production base. They are probably in the most elite group of car manufacturers in India to have such technological knowledge. Their main aim is to make India a global hub for export of cars. They believe that India has the potential to achieve such a feat and in order to take India a step further they are investing heavily here. They are also planning to increase their dealership network and their after sales service. The year 2006 has been a significant year for Hyundai Motor India. It achieved a significant milestone by rolling out the fastest 300,000th export car. Hyundai exports to over 65 countries globally; even as it plans to continue its thrust in existing export markets, it is gearing up to step up its foray into new markets. Hyundai i10, which has bagged the most prestigious awards including Motoring Car of the Year Award, the CNBC-TV18 Car of the Year 2008 Award, the NDTV Car and Bike Awards for Compact Car of the Year 2008 as well as Car of the Year 2008 and the Car of the year 2008 at the 9th Overdrive Awards. Hyundais i10 has captured the entire gamut of the most prestigious of Indian automobile awards. The different models of cars that Hyundai Motors India Limited (HMIL) has launched in the Indian market are:

Hyundai Santro Zing Hyundai Accent Hyundai Getz Hyundai Elantra Hyundai Sonata Embera Hyundai Tucson Hyundai Terrecan Hyundai i10 Hyundai verna
Cars

Hyundai Santro

Hyundai Accent

Hyundai Verna

Santro Santro Santro Santro Santro

XK XK (Non AC) XL XO AT

Accent Accent Accent Accent

GLE GLS Viva Viva CRDi

Verna i (Petrol) Verna Xi (Petrol) Verna XXi (Petrol) Verna CRDi VGT

Accent CRDi

Santro CNG Hyundai Sonata Hyundai Getz

Hyundai Elantra

Elantra GT Elantra CRDi Elantra GLS

Embera 2.4 M/T Embera 2.4 A/T Embera H-Matic

Getz GLS Getz GLX

Hyundai Getz Prime

Hyundai i10 Hyundai Terracan

Getz Prime 1.1 GLE Getz Prime 1.1 GVS Getz Prime 1.3 GLS Getz Prime 1.3 GLX tz GVS

Hyundai Tucson

SECTOR SYNOPSIS:

Major Manufacturers in Automobile Industry

Maruti Udyog Ltd. General Motors India Ford India Ltd. Eicher Motors Bajaj Auto Daewoo Motors India Hero Motors Hindustan Motors Hyundai Motor India Ltd. Royal Enfield Motors Telco TVS Motors

Government has liberalized the norms for foreign investment and import of technology and that appears to have benefited the automobile sector. The production of total vehicles increased from 4.2 million in 1998- 99 to 7.3 million in 2003-04. It is likely that the production of such vehicles will exceed 10 million in the next couple of years. The automotive industry is a key industry in the European economy characterized by having few vehicle manufacturing firms and a substantial number of independent suppliers to which about 2/3 of the production is outsourced. The output includes cars, light trucks and vans, buses and coaches, medium and heavy trucks, motorcycles and agricultural and forestry tractors. Rapid changes in technology are forecast for the auto industry over the next 10 years. The automobile started out as a simple mechanical method of transport. Today's cars are sophisticated, with a significant (and still growing) electrical and electronic content. To provide comfort and safety, while still being friendly to the environment, these new vehicles use the latest developments of many different technologies. Further developments are expected in the areas of brake assistance, adaptive speed control and global navigation and satellite tracking systems.

Unlike in the past, where there were not more than three or four players both in the four-wheeler and two-wheeler segments in the country, the automobile market is now flooded with multinational companies vying with one another, rolling out new models literally every day. There was a time when owning a four-wheeler was widely termed a luxury, but now it is considered a necessity, reflecting the transitional phase the country is in. No doubt, the country has become Asias auto hub and the changing trend here is well noticed worldwide. The automobile sector is vibrant in the country with plenty of potential for growth. Of the countrys population, the addressable group with the potential of buying a vehicle amounts to 20 per cent. The substantial figure provides enough opportunity for the players in the market to explore with their products. At present, around one million cars are being manufactured annually in the country and the figures are likely to get doubled in another 10 years. The industry is blooming and definitely growing at a healthy pace. It has provided a chance for manufacturers to flood the market with their innovative products. Given the road facilities in the country, the manufacturers too have paid more attention to supplement their products with additional features considering the comfort level of customers, as it has become the key. With some of the advanced sophistication like active stability and traction control system available with the product, it is for sure that the customer will have a satisfying driving experience. The increase in sales truly reflects the buoyancy witnessed in the market. The boom in the sector also owes much to the flexible financial options available for customers to help them realize their dreams. Though a steep rise in the loan interest rates threatens to create a dent in sales, in actual terms most of the companies have witnessed an increase in sales in the fourwheeler segment. But, people are also carried away by the discounts, which is a cause for concern. Discounts can be attractive. But more than that safety is important. Customers should look in for additional safety features in the vehicle rather than accessories. The way the brand-conscious people look at investment on vehicles should change. Increase in interest rates has little effect on four-wheeler segment as people who decide to buy a vehicle are more concerned with the timing of purchase.

With changing times, the mode of travel of people has also changed. Many who owned bicycles have graduated to motorcycles while those who have bikes try to shift to the entry-level cars and those who have cars aspire for premium brand four-wheelers .It is a highly volatile market, where customers are very price and time-conscious. Almost all players in the twowheeler segment have rolled out their own product in this segment, for it has become a convenient product.

Indian Automobile Industry:

Auto sector could grow to $145 b by 2016 The domestic automobile market has been growing at 14.2 per cent CAGR over the past 4 years (2000-01 to 2004-05), While the auto components market has been growing at 19.2 per cent CAGR (2000-01 to 2003-04). The industry (OEMs and suppliers together) contributed nearly 4 per cent to the countrys GDP in 2003-04. The automotive sector also offers significant employment opportunities. It employs 0.45 million people directly and around 10 million people indirectly.

Leading Challenges in Automobile Sector:

Computer literacy, and product knowledge; Insufficient training; Insufficient numbers of high-performance customer-facing personnel; Insufficient skills in certain areas, including interpersonal communication, Difficulty securing the best talent to sales and management positions; A low awareness of career opportunities and paths within the industry; and A nagging image problem for the industry exacerbating these issues.

Hyundais Market ShareForecast and Comparison:

ECONOMIC PERFORMANCE: Large increase in per capita income. Rise in non-state sector activity. Growth in exports and domestic demand.

RELEVANCE: Great opportunity for Hyundais business development. Tremendous global growth potential.

STRENGTHS OF HYUNDAI MOTORS:

Public Perceptions of Hyundai brand have been performed as a result of quality improvement of the vehicles. Brand management now influences many levels of decisionmaking creative a more innovative balance between qualitative and quantitative growth. Hyundai produces the most segment leaders among any auto manufacturer. Partnerships and joint projects with other companies.

WEAKNESSES OF HYUNDAI MOTORS:

The lack of new models and the presence of competitive local cars like Chery and Geely will not help Hyundais cause. Company has a limited ability to add new models. Need for stronger brand management.

Competitive Landscape:
The major drivers of US demand are employment and interest rates. The profitability of individual companies depends on manufacturing efficiency, product quality, and effective marketing. Large companies manufacture multiple product lines, marketed under different brand names. Smaller companies manufacture a few or single product lines. Large companies have advantages of economy of scale; smaller companies compete by focusing on specialized markets.

Industries Where Hyundai Competes:

Automotive & Transport o Auto Manufacturing (primary) Industrial Manufacturing o Industrial Automation & Industrial Control Products Manufacturing o Material Handling Equipment Manufacturing

Top Hyundai Competitors:

Ford Motor General Motors Toyota Tata motors Maruti Suzuki

FORD MOTOR COMPANY:

Ford Motor Company is an American multinational corporation and the world's third largest automaker based on worldwide vehicle sales. Based in Dearborn, Michigan, a suburb of Detroit, the automaker was founded by Henry Ford and incorporated in June 16, 1903. Ford now encompasses many global brands, including Lincoln and Mercury of the US, Jaguar and Land Rover of the UK, and Volvo of Sweden. Ford also owns a one-third controlling interest in Mazda. In 2007, Ford became the third-ranked automaker in US sales after General Motors and Toyota, falling from the second-ranked automaker slot for the first time in the previous 56 years. Ford was also the overall seventh-ranked American-based company in the 2007 Ford received more quality survey awards from J. D. Power and Associates than any other automaker, with five vehicles ranking at the top of their categories, and fourteen vehicles ranked in the top three. Contact Details: 1. Head Office: Corporate office, Ford India Pvt Ltd. Via S.P. Koil, Chengalpattu E-mail: www.india.ford.com

GENERAL MOTORS:
General Motors Corp, the world's largest automaker, has been the global industry sales leader for 76 years. Founded in 1908, GM today employs about 284,000 people around the world. With global headquarters in Detroit, GM manufactures its cars and trucks in 33 countries. GM strengthened its presence in India with new product launches Chevrolet Optra in 2003 and Chevrolet Tavera (Multi Utility Vehicle) in 2004. The existing General Motors plant was originally built by Hindustan Motors (HM). The company entered into a 50 per cent Joint Venture with HM

Subsidiaries: Hughes Electronics Corp. General Motors Acceptance Corporation (GMAC) GM Locomotive Group Allison Transmission Division Product: Automobiles and engines Registered Office: General Motors India Pvt. Ltd. Chandrapura Industrial Estate

Halol, Distt. Panchmahals, Gujarat E-mail: www.gm.co.in

TOYOTA MOTORS:
With the full devotion and round the clock services, Toyota Company has dragged the attention of Indian customers to its products. Toyota tied up with Kirloskar Group by forming Toyota Kirloskar Motor Private Limited. Establishment of Toyota Kirloskar Motor Private Limited or TKM took place ceremonially on 6th October, 1997. Percentage of shares between two shareholders are -Toyota Motor Corporation holding share of 89% while Kirloskar group is having the share of 11%.As a joint venture between Kirloskar Group and Toyota Motor Corporation, Toyota Kirloskar Motor Private Limited (TKM) aims to play a major role in the development of the automotive industry and the creation of employment opportunities, not only through its dealer network, but also through ancillary industries.

Contact Details: 1. Plot No.1, Bidadi Industrial Area, Ram Nagar Taluk, Bangalore, Karnataka. E-mail: www.toyotabharat.com

2. 6th Floor, LE Merridean, Commercial Towers, Raisina Road 8Windsor Road New Delhi. E-mail: www.toyotabharat.com

Tata motors ;
Tata Motors Limited is India's largest automobile company, with revenues of Rs. 32,426 crores (USD 7.2 billion) in 2006-07. It is the leader by far in commercial vehicles in each segment, and the second largest in the passenger vehicles market with winning products in the compact, midsize car and utility vehicle segments. Like indica,indigo sumo safari The company is the world's fifth largest medium and heavy commercial vehicle manufacturer, and the world's second largest medium and heavy bus manufacturer.

Contact; www.tata motors .com

Maruti Suzuki;

More than half the number of cars sold in India wears a Maruti Suzuki badge. Maruti Suzuki is a subsidiary of Suzuki Motor Corporation Japan. As India's largest passenger car company, Maruti Suzuki account for over 50 per cent of the domestic car market. Maruti Suzuki have a sales network of 562 outlets in 372 towns and cities, and provide maintenance support to customers at 2538 workshops in over 1200 towns and cities (as on December 31,2007).

Since inception, Maruti Suzuki have produced and sold over 6.75 million vehicles, including almost 500,000 units in Europe and other export markets. Maruti Suzuki have been rated first in customer satisfaction for eight years in a row in J D Power's Surveys, and are India's Most Respected Automobile Company (As per survey conducted by Business world, a reputed Indian Magazine)

Contact: marutiudyog.com

PRODUCT OFFERINGS:
Hyundai Motor Company is an automobile manufacturer in Korea. The Company markets the Atoz Prime, Getz, Accent, Elantra, Hyundai Coupe, Sonata, Grandeur XG and Centennial passenger cars; the Trajet, Terracan, Tucson, Santa Fe, H-1 and Matrix recreational vehicles, and commercial vehicles, which include trucks, buses, tractors and specialty vehicles, such as refrigerated vans, remicon mixers and oil tankers. In addition, the Company manufactures gasoline, diesel and industrial engines. It operates overseas plants in North America, India and China, and research and development centers in North America, Japan and Europe. Some of the Passenger Cars: 1. i10:

2. i30 :

3. Atos Prime:

4. Getz:

5. Accent:

6. Elantra:

6. Sonata:

7. Hyundai verna

Some Recreational Vehicles: 1. Veracruz:

2. Tucson:

3. Terracan:

Some commercial vehicles:

1. Super Aero City:

2:County:

GLOBAL EXISTENCE:

DISTRIBUTION IN THE COUNTRY:

The Bhagat Group is currently operating several automobile dealerships for Ford India Limited and Hyundai Motor India Limited across the state of Punjab. The Bhagat Group is among the leading Hyundai dealers in India. It was established in 1998 and renowned as one of most reputed Hyundai dealers in Punjab, Bhagat Hyundai dealerships are located at Patiala, Bhathinda, Sangrur, Rajpura, and Mukatsar.

THE PRESENT:

Hyundai motor India ltd is the second largest & the fastest growing car manufacture in India , presently markets 34 variants of passenger cars in six segments. The santro in the B segment , getz prime ,i10 in the B+ segment , the assent & verna in the c segments & elantra in the D segments , the sonata embera in the E segment & the Tucson & terracan in the suv segments.

THE FUTURE: In addition to promoting its i10, hundai launched two cars at the 9th auto expo 2008 held on new delhi. The santa fe suv finally going to lands on Indian shores, sporting 2.2liter diesel engine and price tag of rs 16 lakh Hyundai will also make the world debut of the i30 sedan , which will replace the elantra and will be priced in the rs 9-10 lakhs bracket. Expected to be launched by the end of 2008, it will be available with 2 litre petrol as well as 1.6 litre diesel engines. the karma q and veloster concepts would also be showcased at the auto expo. Hyundai motors India ltd is investing to expand capacity in line with its positioning as Hyundai motor company global export hub for compact cars , apart from expansion of production capacity ,hmil plans to expand its dealer network which will be increased from 183 to 250 this year .& with the companys greater focus on the quality of its after sales-service hmils service network will be expanded to around 1000 Hyundai Motors India Ltd. plans to build a world class facility, which will offer quality products and services to the discerning consumer. It plans to enforce the " global optimum production system", setting its goal to achieve the utmost result with the lowest running cost

The Indian operations will play an important role for Hyundai to develop and expand their presence in the neighboring South East Asian countries and plans to export the Santro as SKDs (semi-knockdown kits) and CBUs (completely built units) to the neighboring countries like Pakistan, Bangladesh, Nepal and Sri Lanka .In fact the Santro has been launched in its parent country under a new name the Visto. The body panels and the engine as well as the transmission components are entirely imported from India, and the Visto is being assembled by HMC at their Ulsan Plant. Best customer service Best technology Best quality products Best value for people.

COMPANY PROMOTIONAL STRATEGIES

SANIYA MIRZA

PreityZinta 1. Promotional Strategies:

Hyundai Motor India offers women friendly incentives: With the purchase of a new Hyundai, female car buyers in India are being offered women-friendly features like reduced interest rates, lower processing fees, discounts on gold purchases, and a free credit card. Hyundai, the No. 2 automaker in India, launched the Special Women Scheme in order to encourage car ownership among the fairer sex. Hyundai partnered with 14 banks and auto finance companies in order to present the offer. ICICI BANK for example, has an auto loan product only being offered to women that includes discounts on gold purchases. For the brand launch, Hyundai roped in Saatchi & Saatchi as the ad agency. Thus came the first commercial. The ad introduced Kim and Shah Rukh and a glimpse of the car. Kim was the Hyundai official who wanted SRK to be the brand ambassador for Santro. The name Kim was chosen wisely because the only familiar Korean name known to Indians was KIM .The ad introduced the brand and the company with a subtle statement from Kim: We settle only for the best. The first ad was followed by teaser ads where Kim tries to convince SRK that Hyundai is serious about India, the quality issue and the brand Santro. These ads really created hype in the market about Santro. Teaser ads are dangerous and expensive. Dangerous because if the teaser failed to click, the

entire product launch will land up in trouble. Another issue is that the brand should follow up the hype built by teaser ads. In the case of Santro, the teasers were intelligently made and clicked. Finally came the launch ad which showed Shah Rukh who represented the Indian consumer saying I am Convinced" to Kim. Shah Rukh fitted perfectly to the promotional scheme of Santro

SRK IS A BRAND AMBASSADER OF HYUNDAI MOTORS INDIA

. Pricing Strategy:

This value strategy obviously finds clearest expression in pricing decisions. Hyundai Motors launched its cars in the United States in 1986 priced 20% below Japanese competitors, though the price differential today is only 10% . This value strategy obviously finds clearest expression in pricing decisions. Hyundai Motors launched its cars in the United States in 1986 priced 20% below Japanese competitors, though the price differential today is only 10% .Such pricing strategy is crucial to communicate greater value positioning, and the target consumer segments are correspondingly those of lower segments.

Hyundai Motor India Ltd rolled out the fastest 1,500,000th car in September 2007.

The celebration event comes nine years since Hyundai started production in India. According to the company, Hyundai Motor India would continue to bring the best and the latest in automotive technology and design backed by the best of warranty, competitive pricing, and a huge sales and service support network to its customers in the country.

Latest news :

29th February, 2008 Hyundai Motor India drops prices by Rs 19,419 The Union budget announced today brought about the much awaited excise duty cut for the small car segment at a time when the industry was just beginning to witness flattening growth curve. Hyundai Motor India the countrys second largest passenger car manufacturer and the largest exporter which offers a full range of cars starting from compact to premium luxury cars will offer its customers a much revised price package for it compact cars. The competitive price of Hyundai cars are set to become even more competitive after this years Union Budget with the price cut going as high as Rs 19,419 for its Getz Prime CRDi model. The HMI range of cars now start at an attractive Rs 261,631 for it flagship model the Santro and goes up to

Rs 351,482. The newly launched, segment defining, i10 sports a new price tag of Rs 330,686 making it one of the best priced cars in this segment. Model Santro i10 Getz Prime Price reduction range Rs 8,730 Rs 13,278 Rs11,047 Rs 16,324 Rs 13,169 Rs 19,419

28th February, 2008 Hyundai celebrates Womens Day with attractive offer on the Santro AT New Delhi, February 28, 2008: Hyundai Motor India the countrys second largest passenger car manufacturer and the largest exporter have launched a new scheme for its women customers in celebration of the International Womens day and the Womens Week starting from 1st March, 2008. The flagship model of the company the Hyundai Santro will be made available to its customers with an Automatic Transmission (AT) and a more attractive price tag. The price has been reduced by approximately Rs 14,000 to increase its appeal. The Automatic version had been available to its customers since September, 2002 but what is new about the scheme is that Hyundai Motor India is now targeting its womens customers with an offer of reduced finance scheme in collaboration with its financing partner Axis Bank Ltd. Not only is there a 0.75% discount on the interest rate but also the loan processing fee has been reduced to 50%. The company will offer all the prevailing discounts and offers which are ongoing for the Santro. The automatic version of the Santro is a perfect choice for the women drivers and city driving condition as it doesnt require the driver to frequently change gears and makes driving an enjoyable experience. The Santro which is the largest selling car in it segment is one of the first cars in this segment to offer a choice of 4-speed Automatic transmission.