PROJECT REPORT ON MARKETING STRATEGIES OF MARUTI SUZUKI

SUBMITTED BY AKASH SHUKLA

T.Y.B.M.S. 2012 - 13

PROJECT GUIDE SUMBUL

SUBMITTED TO UNIVERSITY OF MUMBAI

VIDYALANKAR SCHOOL OF INFORMATION TECHNOLOGY (AFFILIATED TO UNIVERSITY OF MUMBAI) VIDYALANKAR MARG, WADALA (E), MUMBAI 400 037

MARKETING STR ATEGI ES

A Project Report on MARKETING STRATEGIES OF SAMSUNG

Submitted By AKASH SHUKLA

T.Y.B.M.S Semester V 2012 - 13

Submitted To University of Mumbai

Vidyalankar School of Information Technology (Affiliated to University of Mumbai) Vidyalankar Marg, Wadala (E), Mumbai 400 037

VIDYALANKAR SCHOOL OF INFORMATION TECHNOLOGY

(Affiliated to Mumbai University)

Certificate
This is to certify that Mr./Ms. _________________________________ of B.M.S Semester _____ has undertaken & completed the project work titled ______________________________ during the academic year __________ under the guidance of Mr./Ms. _______________ submitted on _________ to this college in fulfillment of the curriculum of Bachelor of Management Studies, University of Mumbai.

This is a bonafide project work & the information presented is True & original to the best of our knowledge and belief.

PROJECT GUIDE

COURSE CO-ORDINATOR

EXTERNAL EXAMINER

PRINCIPAL

DECLARATION

Vidyalankar School of Information Technology (Affiliated to University of Mumbai) Vidyalankar Marg, Wadala (E), Mumbai 400 037

I AKASH SHUKLA of Vidyalankar School of Information Technology, T.Y.B.M.S Semester V hereby declare that I have completed the project on MARKETING STRATEGIES OF MARUTI SUZUKI in academic year 2012 - 13 The information submitted is true and original to the best of my knowledge

Signature of the Student, AKASH SHUKLA

ACKNOWLEDGMENT

I hereby acknowledge all those who directly or indirectly helped me to draft the project report. It would not have been possible for me to complete the task without their help and guidance

First of all I would like to thank the principal Dr. Rohini Kelkar Madam and the coordinator Prof. Vijay Gawde Sir who gave me the opportunity to do this project work. They also conveyed the important instructions from the university from time to time. Secondly, I am very much obliged of Prof. [Name of Project Guide] for giving guidance for completing the project

Then I must mention the person who co-operated with me Deepak Shide, Ground Manager of Sai Service Andheri. They not only rendered time out of their busy scheduled but also answered my queries without hesitation. He gave me information on their system of working in their organisation and told me how Promotional Strategies are done in their organisation.

Last but not the least, I am thankful to the University of Mumbai for offering the project in the syllabus. I must mention my hearty gratitude towards my family, other faculties and friends who supported me to go ahead with the project.

EXECUTIVE SUMMARY
What comes to your mind first when u come across the term MARUTI SUZUKI, it always absolutely has to be Maruti 800, best known as The Middle class car of India.

 Leading Growth as the market leader, MUL led the growth in the passenger car sectorlast year. Marutis sales went up 30% to 4,72,000/- units.
It is observed that, 46% of the customers are of opinion that Maruti should improve in quality, and 16% of the opinion that Maruti should improve in price. The company annually exports more than 50,000 cars and has an extremely largedomestic market in India selling over 730,000 cars annually. Maruti 800, till 2004, wasthe India's largest selling compact car ever since it was launched in 1983. More than amillion units of this car have been sold worldwide so far. Currently, Maruti Alto tops thesales charts and Maruti Swift is the largest selling in A2 segment Due to the large number of Maruti 800s sold in the Indian market, the term"Maruti" is commonly used to refer to this compact car model.

INTRODUCTION TO THE STUDY

Aim of doing the project To find the marketing strategies of Maruti Suzuki To learn about the strategies how they market their new products.

Objective of doing the project 1. To find out the market share of Maruti Suzuki 2. To study competitors of Maruti Suzuki 3. To study the marketing strategies of Maruti Suzuki

Limitation of doing the project: 1. It was difficult to get the information 2. Less Co operation from the organization

Methodology of data collection: 1. Questionnaire 2. Talks with aruti Suzuki Officials 3.Internet

TABLE OF CONTENTS
Sr.No.
1. 2. 3. 4. INTRODUCTION HISTORY OF MARUTI UDYOG OTHER PRODUCTS OF MARUTI SUZUKI TIMELINE

Particulars

Page No.

5.

COMPETITORS

6. 7. 8.

7 Ps OF MARUTI SUZUKI SWOT ANALYSIS BRAND POSITIONING

9.

ETHICAL ISSUES

10. COMPANY PROFILE 11. FUTURE STRATEGIES

12. FUTURE CHALLENGES

13. 14 15 16 17 18 19

INDUSTRY ANALYSIS CURRENT SCENARIO KEY STRATEGIES CASE STUDY ADD ON SERVICES SUGGESTIONS

LIMITATIONS 20 QUESTIONNAIRE

21

CONCLUSION

22

BIBLOGRAPHY

MARKETING STRATEGIES OF MARUTI SUZUKI SWIFT

MARUTI SUZUKI SWIFT

INTRODUCTION

Maruti Udyog Limited Maruti Udyog Limited, a subsidiary of Suzuki Motor Corporation of Japan, has been the leader of the Indian car market for about two decades. Its manufacturing plant, located some 25 km south of New Delhi in Gurgaon, has an installed capacity of 3,50,000 units per annum, with a capability to produce about half a million vehicles. The company has a portfolio of 11 brands, including Maruti 800, Omni, premium small car Zen, international brands Alto and WagonR, offroader Gypsy, mid size Esteem, luxury car Baleno, the MPV, Versa, Swift and Luxury SUV Grand Vitara XL7. In recent years, Maruti has made major strides towards its goal of becoming Suzuki Motor Corporation's R and D hub for Asia. It has introduced upgraded versions of WagonR, Zen and Esteem, completely designed and styled in-house. Maruti's contribution as the engine of growth of the Indian auto industry, indeed its impact on the lifestyle and psyche of an entire generation of Indian middle class, is widely acknowledged. Its emotional connect with the customer continues Maruti tops customer satisfaction again for sixth year in a row according to the J.D. Power Asia Pacific 2005 India Customer Satisfaction Index (CSI) Study. The company has also ranked highest in India Sales Satisfaction Study. The company's quality systems and practices have been rated as a "benchmark for the automotive industry world-wide" by A V Belgium, global auditors for International Organisation forStandardisation. In

keeping with its leadership position, Maruti supports safe driving and traffic management through mass media messages and a state-of-the art driving training and research institute that it manages for the Delhi Government. The company's service businesses including sale and purchase of pre owned cars (TrueValue), lease and fleet management service for corporates (N2N), Maruti Insurance and Maruti Finance are now fully operational.. These initiatives, besides providing total mobility solutions to customers in a convenient and transparent manner, have helped improve economic viability of The company's dealerships. The company is listed on Bombay Stock Exchange and National Stock Exchange. The objectives of MUL then were: Modernization of the Indian Automobile Industry. Production of fuel-efficient vehicles to conserve scarce resources. Production of large number of motor vehicles which was necessary for economic growth. Production / R & D Spread over a sprawling 297 acres with 3 fully-integrated production facilities, the Maruti Udyog Plant has already rolled out over 4.3 million vehicles. In fact, on an average, two vehicles roll out of the factory every minute. And it takes on an average, just 14 hours to make a car. More importantly, with an incredible range of 11 models available in 50 variants, there's a Maruti Suzuki made here to fit every car-buyer's budget. And dream.

TIMELINE OF MARUTI UDYOG

1981- MARUTI UDYOG LTD was incorporated on under the INDIAN COMPANIES ACT, 1956. 1982- License and Joint Venture agreement signed between Maruti Udyog Ltd. & Suzuki Motor Corporation Japan(SMC). 1987- First lot of 500 cars exported to Hungary 1992- SMC increases its stake in Maruti to 50 percent. 2002- Maruti Finance in Mumbai with 10 Finance companies is introduced. Childrens park inaugurated in Delhi. SMC acquires majority stake in MUL (increases to 54.2%). 2003- IPO (JUNE- ISSUE oversubscribed 11.2 times) Maruti gets listed on BSE and NSE- July. 2006- New car plant and the diesel engine facility commences operations during 2006-2007 at Manesar, Haryana. In November Maruti inaugurated a new Institute of Driving Training and Research( IDTR) set up as a collaborative project with Delhi Government at Sarai Kale Khan in South Delhi. 2007- Board of Directors give approval to new name MUL to become Maruti Suzuki India Limited. Corporate Social Responsibility: adopts three villages in Manesar 2008- M-800 crosses 25 lakh mark. MSIL celebrates its Silver Jubilee. MSIL launches National Road Safety Program. 2009- A-STAR or Suzuki Alto debuts at Geneva Motor Show sales begins. Capacity to manufacture expanded from 800,000 to a million units( Gurgaon plus Manesar plants) annually.

HISTORY

The Evolution Marutis history of evolution can be examined in four phases: two phases during preliberalization period (1983-86, 1986-1992) and two phases during post-liberalization period (1992-97, 1997-2002), followed by the full privatization of Maruti in June 2003 with the launch of an initial public offering (IPO). The first phase started when Maruti rolled out its first car in December 1983. During the initial years Maruti had 883 employees, a capital of Rs. 607 mn and profit of Rs. 17 mn without any tax obligation. From such a modest start the company in just about a decade (beginning of second phase in 1992) had turned itself into an automobile giant capturing about 80% of the market share in India. Employees grew to 2000 (end of first phase 1986), 3900 (end of second phase 1992) and 5700 in 1999. The profit after tax increased from Rs 18.67 mn in 1984 to Rs. 6854.54 mn in 1998 but started declining during 1997-2001. During the pre-liberalization period (1983-1992) a major source of Marutis strength was the wholehearted willingness of the Government of India to subscribe to Suzukis technology and the principles and practices of Japanese management. Large number of Indian managers, supervisors and workers were regularly sent to the Suzuki plants in Japan for training. Batches of Japanese personnel came over to Maruti to train, supervise and manage. Marutis style of management was essentially to follow Japanese management practices. The Path to Success for Maruti was as follows: (A)teamwork and recognition that each employees future growth and prosperity is totally dependent on the companys growth and prosperity (b) strict work discipline for individuals and the organization (c) constant efforts to increase the productivity of labor and capital (d) steady improvements in quality and reduction in costs (e) customer orientation (f) long-term objectives and policies with the confidence to realize the goals (g) respect of law, ethics and human beings. The path to success translated into practices that Marutis culture approximated from the Japanese management practices.

 Maruti adopted the norm of wearing a uniform of the same color and quality of the fabric for all its employees thus giving an identity. All the employees ate in the same canteen. They commuted in the same buses without any discrimination in seating arrangements. Employees reported early in shifts so that there were no time loss in-between shifts. Attendance approximated around 94-95%. The plant had an open office system and practiced on-the-job training, quality circles, kaizen activities, teamwork and job- rotation. Near-total transparency was introduced in the decision making process. There were laid-down norms, principles and procedures for group decision making. These practices were unheard of in other Indian organizations but they worked well in Maruti. During the pre- liberalization period the focus was solely on production. Employees were handsomely rewarded with increasing bonus as Maruti produced more and sold more in a sellers market commanding an almost monopoly situatio

OTHER PRODUCTS OF MARUTI SUZUKI

MARUTI SUZUKI SWIFT

MODELS AVAILABLE FROM Rs 4.48 L - 6.80 L

OTHER PRODUCTS OF MARUTI SUZUKI

MARUTI SUZUKI RITZ

MODELS AVAILABLE FROMRs. 4.28L - Rs. 6.26 L

OTHER PRODUCTS OF MARUTI SUZUKI

MARUTI SUZUKI SWIFT

MODELS AVAILABLE FROM Rs Rs 7.15 L - 9.43 L

OTHER PRODUCTS OF MARUTI SUZUKI

MARUTI SUZUKI ERTIGA MODELS AVAILABLE FROM Rs Rs 7.15 L - 9.43 L

ABOUT MARUTI UDYOG LTD.

MARUTI SUZUKI ERTIGA MODELS AVAILABLE FROM Rs Rs 3.02 L - 3.98

COMPETITORS OF MARUTI UDYOG LTD.

COMPETITORS OF MARUTI SUZUKI SWIFT

Hyundai Santro 1.1 CRDi When Hyundai launch the Santros replacement in 2007, it will come with the surprise addition of a 1.1 litre common rail diesel. Likely to be the cheapest car on sale powered by a CRDi engine, this motor is the new Accents CRDi unit less one cylinder. Incredibly powerful for its size, this 1,120cc engine produces a whopping 75bhp. Unconfirmed reports talk of overall figures, city and highway combined, in excess of 20 kilometres a litre. Hyundai Getz 1.5 CRDi Not as attractive as the Swift, but more practical, with greater rear seat comfort and more useable space, Hyundais diesel assault continues up the range with its large hatch. The Getz will share its motors with the new Accent/ Verna. Hyundai sell the Getz powered by a detuned version of the new Accent motor in the European continent, and its likely to be the case here as well. Producing 87bhp as against 108bhp, using two versions of the same engine will help Hyundai get a handle on costs. The diesel Getz also qualifies for excise sops, meeting both length and engine capacity criteria. Tata Indica 1.3 Multijet By the time the larger new Indica is out, the Tata-Fiat tie-up will be going full throttle. Tata will borrow engines from Fiat with, you guessed it, the 1.3 litre Multijet being the engine of choice. Thoroughly localised, cheaply assembled and very capable, it will give the new Indica/ Indigo family a huge leap forward as far as overall ability is concerned.

7Ps OF MARUTI SUZUKI SWIFT

PRODUCT PRICE PROMOTION PLACE PHYSICAL LAYOUT PROVISION OF CUSTOMER SERVICE PROCESSES

 PRODUCT
Features:
The all-new Maruti Suzuki Swift is fully loaded with a range of exciting new features. It's a perfect complement to your evolved tastes and lifestyle. And the best way to take your driving pleasure to a brand-new high. European Styling. Japanese Engineering. Dream-Like Handling.

The new Swift is a generation different from Suzuki design. Styled with a clear sense of muscularity, its one-and-a-half box, aggressive form makes for a look of stability, a sense that it is packed with energy and ready to deliver a dynamic drive. Its solid look is complemented by an equally rooted road presence and class-defining ride quality. New chassis systems allow for the front suspension lower arms, steering, gearbox and rear engine mounting to be attached to a suspension frame. You get lower road noise, and a greater feeling of stability as you sail over our roads with feather-touch ease. There are three variants of Maruti Suzuki Swift : Swift LXi Swift VXi Swift ZXi Swift LXi 3 assist grips, 3 spoke urethane steering wheel, antenna, cabin light (3 position), console box (lower), cup holders (front 2, rear1), front door trim pockets, green tinted glass window, halogen headlamps, headlamp leveling device, heater and manual Air conditioning, OVRM (internally adjusted), rear fog lamps, wind screen wiper 2 speed plus 1 speed

intermittent, tailgate opener key type, trip meter (digital display), sun visors (both sides), brake assist , child lock (rear door), high mounted stop lamp, power steering, rear seat belts etc. are the features available in this model. Swift VXi Apart from the features found in other model, striking features of this model are black colored A & B pillars, 12v accessory socket in center console, day and night rear view mirror, door ajar warming lamp, driver's seatbelt warning lamp, tachometer, driver's seat belt warning lamp, vanity mirrors (sun visor co-driver side), rear seat head restraints, fabric accented door trims, central door locking (4 door), front and rear electronic windows, front fog lamps, light off/ key reminder, manual air-conditioning, key not removed warning buzzer, etc. Swift ZXi Special features that have made this model more market friendly are rear window demister, rear parcel shelf, rear window wiper, room lamp and luggage room, keyless entry,dual front airbags, colored outside door mirror cowls, colored outside door handles, 12v accessory socket in luggage room, driver seat height adjuster, central door locking (5 doors), seat belts 3-point ELR with shoulder adjusters, seat belts front 3-point ELR with pretensioning,tailgate opener electromagnetic type etc.

 PRICE
Maruti is expected to take Hyundai heads on with the pricing of their upcoming Maruti Suzuki Swift car. After launching cars for the masses since so many years, Indias largest automobile manufacturer is now targeting the premium segment with their latest model from the Suzukis stable. The analysts predict the pricing of this premium hatchback to start from Rs. 4 lakh. This price range would practically rip apart Hyundais offering in Getz, which is priced at a much higher tag of Rs. 4.5 lakh. Both the companies are known for their value based offerings and Maruti with their extensive service network and brand reputation for making reliable cars should get the customers nod over their competition. The official pricing however is still not out. However, the company is said to be studying the prospects of launching the base model at the 4lakh price tag. There is another advantage in doing so considering in the capital city of Delhi NCR road tax on the sub 4 lakh priced cars is comparatively lower at 2%. Cars at a price higher than 4 lakh have to pay a 4% road tax. Delhi NCR is one of the major targeted markets and it might get the benefit of this policy. And if they indeed do take the chance of pricing Suzuki Swift at a considerable lower price than Hyundai Getz, they would quite likely force the competition to rethink their strategy.

Variant Swift LXi Swift VXi Swift VXi (ABS) Swift ZXi

Non Metallic Price 416485 443924 464962 528096

Metallic Price 416485 443924 464962 528096

 PROMOTION
When Maruti Udyog launched the Swift in May last year, the automotive industry was agog with expectation that the car had the makings of a real winner. Three versions were launched with the base variant carrying a retail tag of Rs 3.85 lakh, ex-showroom, New Delhi, and this aggressive pricing only reinforced this feeling. A year later, the company says the Swift is now the most-sold car in the first year of any car in the history of the Indian automobile industry, having totted up sales of 61,200 units. This is higher than what Maruti had initially planned to sell. The car recorded an estimated 4,000 bookings at the time of its launch, and the initial output of 200 units a day on a two-shift basis, wasnt enough to cope with demand. In October, the company increased capacity for the Swift which helped cut down on the waiting time from an estimated three months. The company currently makes over 300 units every day. The Swift has made a real impact in the small hatchback segment leaving its closet rival, the Getz far behind. Between April 2005 and April 2006, Hyundai sold 16,872 units of the Getz. Maruti is now gearing up for the diesel version of the Swift which is expected to debut by October. The diesel version will benefit from the excise sops in this years buget, and it remains to be seen how the models fares in the marketplace.

 PLACE
The car manufacturing company, called Maruti Suzuki Automobiles India Limited, is a joint venture between Maruti Udyog and Suzuki Motor Corporation holding a 70 per cent and 30 per cent stake respectively. The Rs1,524.2 crore plant has a capacity to roll out 1 lakh cars per year with a capacity to scale up to 2.5 lakh units per annum. The car manufacturing plant will begin commercial production by the end of 2006. The engine and the transmission plant has owned by Suzuki Powertrain India Limited in which Suzuki Motor Corporation would hold 51 per cent stake and Maruti Udyog holding the balance.

The ultimate total plant capacity is three lakh diesel engines. However, the initial production is 1 lakh diesel engines, 20,000 petrol engines and 1.4 lakh transmission assemblies. MUMBAI - Showrooms AUTOMOTIVE MANUFACTURERS LTD MIDC,TTC INDL.AREA, PLOT NO.D-234,SHIRVANEVILLAGE BOMBAY PUNE ROAD Autovista 257,S.V. ROAD, BANDRA (W) MUMBAI MAHARASHTRA M/S SK WHEELS PVT LTD SITE NO. D-267 TTC INDUSTRIAL AREA, MIDC TURBHE, NAVI MUMBAI NAVNIT MOTORS PVT LTD GOKUL NAGAR MUMBAI-AGRA ROAD, THANE-400 061 RATAN MOTORS 23/24 BEZZOLA COMPLEX SION-TROMBAY ROAD CHEMBUR SAH and SANGHI AUTO AGENCIES (P) LTD GIRI KUNJ, 11-C N S PATKAR MARG KEMPS CORNER SAI SERVICE STATION LTD PHOENIX MILL COMPOUND, 462,SENAPATI BAPAT MARG,

LOWER PAREL,

SWOT ANALYSIS OF MARUTI UDYOG LTD.

STRENGTHS WEAKNESSES OPPURTUNITIES THREATS

STRENGTHS
The Quality Advantage Maruti Suzuki owners experience fewer problems with their vehicles than any other car manufacturer in India (J.D. Power IQS Study 2004). The Alto was chosen No.1 in the premium compact car segment and the Esteem in the entry level mid - size car segment across 9 parameters. The J.D. Power APEAL Study 2004 proclaimed the Wagon R no. 1 in the premium compact car segment and the Esteem No.1 in the entry level mid - size car segment. This study measures owner in terms of design, content, layout and performance of vehicles across 8 parameters. A Buying Experience Like No Other Maruti Suzuki has a sales network of 307 state-of -the-art showrooms across 189 cities, with a workforce of over 6000 trained sales personnel to guide our customers in finding the right car. Our high sales and customer care standards led us to achieve the No.1 nameplate in the J.D. Power SSI Study 2004.

Quality Service Across 1036 Cities In the J.D. Power CSI Study 2004, Maruti Suzuki scored the highest across all 7 parameters: least problems experienced with vehicle serviced, highest service quality, best in-service experience, best service delivery, best service advisor experience, most user-friendly service and best service initiation experience. 92% of Maruti Suzuki owners feel that work gets done right the first time during service. The J.D. Power CSI study 2004 also reveals that 97% of Maruti Suzuki owners would probably recommend the same make of vehicle, while 90% owners would probably repurchase the same make of vehicle. MUL is in a leadership position in the market. Major strength of MUL is having largest network of dealers and after sales service caters in the country. Self competing product range in small car segment Maruti 800 OmnI Zen Wagon R Good promotional strategy is adopted by MUL to transform its thoughts to the people about its products After Sales Service - Availibility of service stations even in the remotest place in the country. Refurbished Cars: MUL has also entered into second hand car market with a brand name Maruti True Value Loyal Customer Base is another big strength of MUL. In JD Power survey, MUL has been awarded consequently 5th year for best customer satisfaction. Strong Brand Value Availability of raw material

WEAKNESSES

Lack of having products in mid size car segment could result in shifting of loyal customers who has a desire to upgrade their cars. Low interior quality in side the cars. Labour Laws and Labour Unions are not in a good form in India. Government intervention due to having share in MUL.

OPPORTUNITIES Leading Growth as the market leader, MUL led the growth in the passenger car sectorlast year. Marutis sales went up 30% to 4,72,000/- units. This is thehighest annual sale since the company began operations 20 years ago.Maruti also gained market share, mainly on account of its performancein the competitive A2 segment where it increased its share from 40.3%in 2002-03 to 47.7% in 2003-04 The record sales performance was reflected in the financials. Net Sales(excluding excise) grew by 31% to Rs 93,456 million. Operating ProfitMargin increased from 0.8 % in 2002-03 to 4.7 % in 2003-04. Profit AfterTax jumped 2700 million to Rs 5421 million.MUL is committed to motorising India. Towards this end, companyspartnership with State Bank of India and its Associate Banks tookorganised finance to small towns to enable people to buy Maruti cars MUL may encash the opportunity to enter again into the diesel segment of the cars to compete its nearest competitor TATA in diesel segment of small cars. Though MUL launched Zen in diesel version but it was not successful. MUL has launched its LPG version of Wagon R and it was a good move simultaneously MUL can start R&D on electric cars for a much better substitute of the fuel. REMARKABLE GROWTH: If we observe Maruti as a brand over the years we can note a remarkable phenomena or strategy from their growth in past years. It first became popular n still is with its launch of Maruti 800 many years back. They targeted middle income groups, who were first time car buyers, looking for low ownership cost with basic need of a family vehicle and the price was approx 2lacs. After this they never looked back. Then came the other various hatchback models of Maruti like Zen, WagonR, and Alto etc. These Cars again targeted the middle income groups, but this

time the positioning was not as the basic need, it was comfort at comparatively lower price, of 4 5 lacs. Then putting Yet another Step forward, they came into Sedans with a price of 8-9 lacs these Sedans targeted SEC A as well as B(up till a certain extent) Economic growth of the country is sound and promising in future. Liberal policies of GOI. Big Market: Domestic and Abroad

 THREATS THREATS FROM COMPETITORS Tata Motors LimitedIn the 2004 fiscal year, Tata Motors generated revenues of $3,542.2 million(INR154,935.2 million). The company made a net profit of $185 million(INR8,103.4 million) in the 2004 fiscal year.General Motors CorporationFor the fiscal year ended December 2004, GM generated revenues of $193,517million, an increase of 4.3% from the previous year. The company reported anet income of $2,805 million for fiscal 2004, down 26.6% from the previous year. Tata Motors has launched TATA NANO with a price tag of Rs. 1 Lac and that could give a big impact on sales of MUL HMIL is a challenger and trying hard to achieve number one position in the market. China may give a good competition as they are also planning to enter into car segment.

BRAND POSITINING

What comes to your mind first when u come across the term MARUTI SUZUKI, it always absolutely has to be Maruti 800, best known as The Middle class car of India.

BRAND IMAGE: MARUTI from as a brand itself is seldom looked at, as a luxury brand. Maruti as a brand is more linked with the SEC B rather than A. And over past many years Maruti Has maintained and up till certain extent restricted its Target Market to same SECs.

OBJECTIVES OF THE STUDY

1. To find out the market share of Maruti Suzuki 2. To study competitors of Maruti Suzuki 3. To study the marketing strategies of Maruti Suzuki 4. To study the strength, weakness, opportunity, and threats (swot - - analysis) 5. To study the customer satisfaction regarding Maruti Suzuki cars 6. To study the comparison of swift and swift dzire.

ETHICAL ISSUES OF MARUTI SUZUKI Labor Pains Continue at Maruti Suzuki

Maruti Suzuki, the Indian subsidiary of Suzuki Motor of Japan, has been in the news for the past several months because of a continuing workers agitation. The strike is now over. But the way it was settled raises several important issues The problem arose at Marutis plant in Manesar (near Delhi). Workers went on strike October 7, demanding the reinstatement of employees who were suspended during previous agitations and the establishment of an independent workers union. The agitation was all set to accelerate with the Maruti management subsequently suspending home-grown leader Sonu Gujjar and 29 others. We will fight to the end, the 24-year-old Gujjar told economic dailyBusinessLine a few days after he was suspended. The Indian press characterized Gujjar as the shy hero of Manesar and portrayed him as a young Arthur battling the dragons. Then, on Friday came reports that Gujjar and his suspended colleagues had a few days earlier taken severance checks from the Maruti management and resigned. Sonu Gujjar, suspended workers at Maruti grab check and quit, reported NDTV. The Times of India is calling the defections a bribery controversy and others are characterizing Gujjar and the other workers as traitors. The settlement amounts reportedly range from $20,000 to $80,000, with Gujjar at the top end. In India, these are significant amounts for what is claimed to be a voluntary retirement payout, especially as most of the 30 had been with the company for only four years. On Monday, there were reports that workers planned to register a new union and take the agitation forward. But the implications of the payouts go far beyond one car plant and one company. The national trade unions have long protested against what they see as heavy-handed labor policies by the management of multinational firms. Now they have a real-life, Indian example. The Maruti deal has gotten even progressive politicians and industrialists thinking twice about how much flexibility should be given to company management in dealing with labor strife. Its unfortunate that a few leaders have accepted money and fallen prey to the practices of multinational companies, A.D. Nagpal, general secretary of the Hind Mazdoor Sabha, told the Times of India. Although it is an isolated incident, the damaging repercussions will hurt the [trade union] movement for a long time.

The second fallout relates to corporate governance. In India, even large shareholders have generally not interfered with the managements of companies in which they own equity. They normally sell their stake and quit the company rather than raise contentious issues. In the Maruti incident, in mid-October Nirmal Bang Institutional Equities organized a conference call with Gujjar. Several analysts and shareholders participated. This was a first for India. Now other investors are questioning the deal with the so-called Manesar 30. Of course, there is a corporate governance issue in what Maruti has done. No doubt about that. It was totally unbecoming of such a large company, Anil Singhvi of Institutional Investors Advisory Services, which works with shareholders on governance issues, told economic daily Business Standard. It is one of the most badly handled situations in the recent past. The Manesar 30 have some supporters, however. Mint, a business daily, argued: Some 1,200 workers went on strike at Manesar. Of these 1,200, it was 30 who bore the brunt. They were suspended and, at one point, their jobs appeared to be under threat. Effectively, they spearheaded the campaign while the others were free-riding. In addition, Maruti leadership was facing significant hits to the companys bottom line due to the strike. The several rounds of labor agitation have resulted in loss of production of 51,000 to 83,000 vehicles, amounting to $330 million to $470 million, according to different estimates. The company couldnt afford to continue with those losses for too long, observers note. Ritu Tripathi, an assistant professor of organizational behavior and human resources management at the Indian Institute of Management in Bangalore, lists two lessons others can take from the situation: the need for strong and open communication channels between workers and their organizations, and the importance of transparency in all policies and procedures. Pointing out that unions themselves often become hubs of politics, Tripathi says that workers must be able to see procedural justice. Research has proved that whenever workers perceive that procedural justice is high, they are more committed towards their organizations. This entry was posted in Knowledge@Wharton Today, Law and Public Policy, Strategic Managementand tagged India, Maruti Suzuki, strike. Bookmark the permalink. Follow any comments here with theRSS feed for this post.

COMPANY PROFILE

Company Profile Maruti Suzuki India Limited is a publicly listed automaker in India. It is aleading four-wheeler automobile manufacturer in South Asia. Suzuki Motor Corporationof Japan holds a majority stake in the company. It was the first company in India to mass- produce and sell more than a million cars. It is largely credited for having brought in anautomobile revolution to India. It is the market leader in India and on 17 September 2007, Maruti Udyog was renamed Maruti Suzuki India Limited. The company's headquartersare in Gurgaon, Haryana (near Delhi).Maruti Suzuki is one of India's leading automobile manufacturers and the marketleader in the car segment, both in terms of volume of vehicles sold and revenue earned.Until recently, 18.28% of the company was owned by the Indian government, and 54.2% by Suzuki of Japan. The Indian government held an initial public offering of 25% of thecompany in June 2003. As of May 10, 2007, Govt. of India sold its complete share toIndian financial institutions. With this, Govt. of India no longer has stake in MarutiUdyog.Maruti Udyog Limited (MUL) was established in February 1981, though the actual production commenced in 1983 with the Maruti 800, based on the Suzuki Alto kei car which at the time was the only modern car available in India, its' only competitorstheHindustan Ambassador and Premier Padmini were both around 25 years out of date atthat point. Through 2004, Maruti has produced over 5 Million vehicles. Marutis are soldin India and various several other countries, depending upon export orders. Cars similar to Marutis (but not manufactured by Maruti Udyog) are sold by Suzuki and manufacturedin Pakistan and other South Asian countries.

The company annually exports more than 50,000 cars and has an extremely largedomestic market in India selling over 730,000 cars annually. Maruti 800, till 2004, wasthe India's largest selling compact car ever since it was launched in 1983. More than amillion units of this car have been sold worldwide so far. Currently, Maruti Alto tops thesales charts and Maruti Swift is the largest selling in A2 segment.Due to the large number of Maruti 800s sold in the Indian market, the term"Maruti" is commonly used to refer to this compact car model. Till recently the term"Maruti", in popular Indian culture, was associated to the Maruti 800 model.Maruti Suzuki India Limited, a subsidiary of Suzuki Motor Corporation of Japan,has been the leader of the Indian car market for over two decades.Its manufacturing facilities are located at two facilities Gurgaon and Manesar south of New Delhi. Marutis Gurgaon facility has an installed capacity of 350,000 units per annum. The Manesar facilities, launched in February 2007 comprise a vehicleassembly plant with a capacity of 100,000 units per year and a Diesel Engine plant withan annual capacity of 100,000 engines and transmissions. Manesar and Gurgaon facilitieshave a combined capability to produce over 700,000 units annually.More than half the cars sold in India are Maruti cars. The company is a subsidiaryof Suzuki Motor Corporation, Japan, which owns 54.2 per cent of Maruti. The rest isowned by the public and financial institutions. It is listed on the Bombay Stock Exchangeand National Stock Exchange in India.

During 2007-08, Maruti Suzuki sold 764,842 cars, of which 53,024 wereexported. In all, over six million Maruti cars are on Indian roads since the first car wasrolled out on December 14, 1983.Maruti Suzuki offers 12 models, Maruti 800, Omni, Alto, Versa, Gypsy, A Star,Wagon R, Zen Estilo, Swift, Swift Dzire, SX4, Grand Vitara. Swift, Swift dzire, A star and SX4 are manufactured in Manesar, Grand Vitara is imported from Japan as acompletely built unit (CBU), remaining all models are manufactured in Maruti Suzuki'sGurgaon Plant.More than half the numbers of cars sold in India wear a Maruti Suzuki badge.We are a subsidiary of Suzuki Motor Corporation Japan.Suzuki Motor Corporation, the parent company, is a global leader in mini andcompact cars for three decades. Suzukis technical superiority lies in its ability to pack power and performance into a compact, lightweight engine that is clean and fuel efficient.Maruti is clearly an employer of choice for automotive engineers and youngmanagers from across the country. Nearly 75,000 people are employed directly by Marutiand its

REPOSITIONING OF MARUTI PRODUCTS

Whenever a brand has grown old or its sales start dipping Maruti makes some facelifts in the models. Other changes have been made from time to time based on market responses or consumer feedbacks or the competitor moves. Here are the certain changes observed in different models of Maruti. Omni has been given a major facelift in terms of interiors and exteriors two months back. A new variant called Omni Cargo, which has been positioned as a vehicle for transporting cargo and meant for small traders. It has received a very good response from market. A variant with LPG is receiving a very good response from customers who look for low cost of running. Versa prices have been slashed and right now the lowest variant starts at 3.3 lacs. They decreased the engine power from 1600cc to 1300cc and modified it again considering consumers perception. This was a result of intensive survey done all across the nation regarding the consumer perception of Versa. Esteem has gone through three facelifts. A new look last year has helped boost up the waning sales of Esteem. Baleno was launched in 1999 at 7.2 lacs. In 2002 they slashed prices to 6.4 lacs. In 2003 they launched a lower variant as Baleno LXi at 5.46 lacs. This was to reduce the price and attract customers. Wagon-R was perceived as dull boxy car when it was launched. This made it a big failure on launch. Then further modifications in engine to increase performance and a facelift in the form of sporty looking grills on the roof. Now its of the most successful models in Maruti stable. Zen has been modified four times till date. They had come up with a limited period variant called Zen Classic. That was limited period offer to boost short term sales. Maruti 800 has so far been facelifted two times. Once it came with MPFi technology and other time it came up with changes in front grill, head light, rear lights and with round curves all around.

C) MAJOR FUTURE STRATEGIES

I. PHASING OUT ZEN IN 2007

The launch of Swift and phasing out Zen is a strategic move. Alto was launched keeping in mind that it will take over Maruti 800 market in future. Perhaps being the flagship product phasing out of Maruti 800 faced lots of resistance from dealers all over. Another reason behind not phasing out Maruti 800 was the fear of brand shift of customers to other competitors product. Swift was launched in May, 2005 in the price band starting from 4 lacs. Before launch of Swift Maruti management had decided that they will phase out Zen since it had already came up with two modifications. The major reason behind this decision was cannibalization of Wagon R and Swift due to overlapping of price band. It is a rational decision to kill a product before it starts facing the decline stage in product cycle. Maruti is offering Rs. 3000.00 more margins to dealer on the sale of Wagon-R as compared to Zen. This is to let dealer push Wagon R instead of Zen. II. MARUTI PLANS FOR A BIG DIESEL FORAY The new car manufacturing company, called Maruti Suzuki Automobiles India Limited, will be a joint venture between Maruti Udyog and Suzuki Motor Corporation holding a 70 per cent and 30 per cent stake respectively. The Rs1,524.2 crore plant will have a capacity to roll out 1 lakh cars per year with a capacity to scale up to 2.5 lakh units per annum. The new car manufacturing plant will begin commercial production by the end of 2006.

Maruti would set up a diesel engine plant at Gurgaon in line with its plan to become a major player in diesel vehicles in a couple of years. This has been done in the wake of major competition from Tata Indica and meets the growing demand of diesel cars in India. While the annual growth in the diesel segment was 13 per cent in the last three years, it was 19-20 per cent in the first quarter (April-June) of the current fiscal. Maruti has currently an insignificant presence in diesel vehicle.It will manufacture new generation CRDI (common rail direct injection) engines in collaboration with Fiat-GM Opel and engines will be of 1200 cc. The plant with a capacity to produce one lakh diesel engines would be operational in 2006.At present, Peugeot of France, supplies diesel engines for Maruti's Zen and mid-sized Esteem models. This will further reduce the imported component in Maruti vehicles, making them more competitive in the Indian market. III. MARUTI PLANS FOR A NEW ENGINE AND TRANSMISSION PLANT The engine and the transmission plant will be owned by Suzuki Powertrain India Limited in which Suzuki Motor Corporation would hold 51 per cent stake and Maruti Udyog holding the balance. The ultimate total plant capacity would be three lakh diesel engines. However, the initial production would be 1 lakh diesel engines, 20,000 petrol engines and 1.4 lakh transmission assemblies. Investment in this facility will be Rs.1,747.7 crore. The commercial production will start by the end of 2006. IV. INDIA AS EXPORT HUB FOR MARUTI Three years back as an experiment, based on the increasing design capabilities of suppliers in countries like India, McKinsey did an exercise to figure out just how much money could be saved if automobiles were to be made in overseas locations like India, Mexico and South Africa - an automobile BPO, so to speak. The result was staggering: the industry stands to gain $ 150 billion annually in cost savings, and an additional $ 170 billion annually in new revenues once demand shoots up following the drop in prices, and the combination of which means a 25 per cent increase in existing revenue levels. According to the study, over 90 per cent of automobiles today are sold in the countries they are made in, so there's a lot of money to be made by shifting the production overseas. Till recently, just 100,000 cars produced in low-cost countries were exported to high-cost ones -- presumably this figure is going up now that Altos from Maruti, Santros from Hyundai, Indicas from Tata Motors, and Ikons from Ford, among others, are being regularly exported out of India. Yet, as McKinsey points out, since it just costs $ 500 and just three weeks (and both figures are falling) to ship out a car to anywhere in the world, why produce cars in high-wage islands? If a car was produced in India instead of in Japan, the study says, it will cost 22-23 per cent less, after factoring in higher import duties for components/steel, lower levels of automation, and transport costs.

In August, 2003 Maruti crossed a milestone of exporting 300,000 vehicles since its first export in 1986. Europe is the largest destination of Marutis exports and coincidentally after the first commercial shipment of 480 units to Hungary in 1987, the 300,00 mark was crossed by the shipment of 571 units to the same country. The top ten destination of the cumulative exports have been Netherlands, Italy, Germany, Chile, U.K., Hungary, Nepal, Greece, France and Poland in that order. The Alto, which meets the Euro-3 norms, has been very popular in Europe where a landmark 200,000 vehicle were exported till March 2003. Even in the highly developed and competitive markets of Netherlands, UK, Germany, France and Italy Maruti vehicles have made a mark. Though the main market for the Maruti vehicles is Europe, where it is selling over 70% of its exported quantity, it is exporting in over 70 countries. Maruti has entered some unconventional markets like Angola, Benin, Djibouti, Ethiopia, Morocco, Uganda, Chile, Costa Rica and El Salvador. The Middle-East region has also opened up and is showing good potential for growth. Some markets in this region where Maruti is, are Saudi Arabia, Kuwait, Bahrain, Qatar and UAE.

The markets outside of Europe that have large quantities, in the current year, are Algeria, Saudi Arabia, Srilanka and Bangladesh. Maruti exported more than 51,000 vehicles in 2003-04 which was 59% higher than last year. In the financial year 2003-04 Maruti exports contributed to more than 10% of total Maruti sales.

V. MARUTI EMERGING AS R&D HUB FOR SUZUKI MOTOR CORPORATION Japanese auto major Suzuki is all set to convert Maruti Udyog Ltds research and development (R&D) facility as its Asia hub by 2007 for the design and development of new compact cars, according to a top official of the firm. The countrys leading car manufacturer will make substantial investments to upgrade its research and development centre at Gurgaon in Haryana for executing design and development projects for Suzuki. This includes localisation, modernisation and greater use of composite technologies in upcoming models. The company will be hiring more software engineers and technocrats to handle Suzukis R&D projects. Investment would be more in terms of manpower than in infrastructure, which is already in place. Apart from working on innovative features, the R&D teams will focus on latest technologies using CAD-CAM tools to roll out new models that will meet the needs of MULs diverse customers in the future. The reasons as to why it can be good for R&D is that

 Firstly the cost involved in R&D and infrastructure is low in India as compared to other countries. Also the technical skills are abundantly available; again at a cheaper cost. Secondly, India is growing as an export hub along with the Indian market growing aggressively into becoming an attractive one for investors. Thirdly, Suzukis investment in India, is also important as it has completely divested now as a result MUL will now become a 100% subsidiary of Suzuki in the coming year.

KEY SUCCESS FACTORS

(1)The Quality Advantage Maruti Suzuki owners experience fewer problems with their vehicles than any other car manufacturer in India (J.D. Power IQS Study 2004). The Alto was chosen No.1 in the premium compact car segment and the Esteem in the entry level mid - size car segment across 9 parameters. (2)A Buying Experience Like No Other Maruti Suzuki has a sales network of 307 state-of -the-art showrooms across 189 cities, with a workforce of over 6000 trained sales personnel to guide MUL customers in finding the right car. (3)Quality Service Across 1036 Cities In the J.D. Power CSI Study 2004, Maruti Suzuki scored the highest across all 7 parameters: least problems experienced with vehicle serviced, highest service quality, best in-service experience, best service delivery, best service advisor experience, most user-friendly service and best service initiation experience. 92% of Maruti Suzuki owners feel that work gets done right the first time during service. The J.D. Power CSI study 2004 also reveals that 97% of Maruti Suzuki owners would probably recommend the same make of vehicle, while 90% owners would probably repurchase the same make of vehicle.

(4)One Stop Shop At Maruti Suzuki, customers will find all car related needs met under one roof. Whether it is easy finance, insurance, fleet management services, exchange- Maruti Suzuki is set to provide a single-window solution for all car related needs. (5) The Low Cost Maintenance Advantage The acquisition cost is unfortunately not the only cost customers face when buying a car. Although a car may be affordable to buy, it may not necessarily be affordable to maintain, as some of its regularly used spare parts may be priced quite steeply. Not so in the case of a Maruti Suzuki. It is in the economy segment that the affordability of spares is most competitive, and it is here where Maruti Suzuki shines. (6)Lowest Cost of Ownership The highest satisfaction ratings with regard to cost of ownership among all models are all Maruti Suzuki vehicles: Zen, Wagon R, Esteem, Maruti 800, Alto and Omni. (7) Technological Advantage It has introduced the superior 16 * 4 Hypertech engines across the entire Maruti Suzuki range. This new technology harnesses the power of a brainy 16-bit computer to a fuel-efficient 4-valve engine to create optimum engine delivery. This means every Maruti Suzuki owner gets the ideal combination of power and performance from his car.

FUTURE CHALLENGES

Maruti has always been identified as a traditional carmaker producing valuefor-money cars and right now the biggest hurdle Maruti is facing is to shed this image. Maruti wants to change it for a more aggressive image. Maruti Baleno has failed due to one of the major reasons being that customers could not identify Maruti with a car as sophisticated as Maruti Baleno. Maruti is looking forward to bring about a perception change about the company and its cars. Maruti started the exercise with the new-look Zen, and Suzuki's decision to pick India as one of the first markets for this radically different-looking car gave this endeavor a new thrust. Maruti has also changed its logo at the front grill. It has replaced the traditional Maruti logo on grill stylish M with S. The major thrust in the facelift endeavour is with the launch of 1.3 litre Swift. Its a style statement from Maruti to Indian market. The next threat Maruti faces is the growing competition in compact cars. Companies like Toyota, Ford, Honda and Fiat are planning to come out with small segment cars in near future.Ford is launching Focus and Fiesta, GM is launching Aveo in 2006, Chevrolet is launching Spark in 2006, Hyundai is launching its new compact car in 2006, Honda is launching Jazz in 2006, GM is has reduced prices of its Corsa, Fiat is coming up with Panda and new Fiat Palio, Skoda is launching Fabia. All this will pose a major threat to Maruti leadership in compact cars. New emission norms like Bharat Stage 3 which has come into effect from April 2005 has increased car prices by Rs.20000 and Bharat Stage 4 which is coming

into force in 2007 will contribute in increasing car prices further. This could be of concern to Maruti which is low cost provider of passenger cars. Rise in petrol prices and growing popularity of other substitute fuels like CNG will be another threat to Maruti. There is also a threat to Suzuki from R&D investment by Toyota and Honda in Hybrid cars. Hybrid cars could run on both petrol and gaseous fuels. There is a threat to Maruti models ageing. Maruti models like Maruti 800 which is in market for the last twenty years and others like Zen and Esteem which have also entered the decline phase are the other threats. Maruti is planning phasing out Zen in 2007 and there were rumors of phasing out Maruti 800 also. This all makes Suzuki to replace these brands with new launches . As Swift and Wagon R are replacing the Zen market. Maruti will have to keep on making modifications in its present models or its models will face extinction.

INDUSTRY ANALYSIS GLOBAL FOUR WHEELER INDUSTRY

Evolution The automobile industry has undergone significant changes since Henry Ford first introduced the assembly line technique for the mass production of cars. Production concepts, processes and the associated technologies have changed dramatically since the first cars were built. Some 70 years ago, car assembly was primarily manual work. Today, the process of car assembly is almost fully automated. In the old days, firms attached importance to the production of virtually every part in a single plant, while today, carmakers concentrate on only a few specific production stages (i.e. car assembly). Parts and module production, services and related activities have been shifted to other, specialised firms (outsourcing of production steps).Since the 1980s, it has become clear that further productivity gains to retain competitiveness can be possible only by outsourcing and securing greater flexibility. For example, firms, especially small car producers whose markets have been threatened by imports, have diversified their production programmes (e.g. by building off-road cars or convertibles) thereby introducing greater flexibility in the production process. Also, firms and their production have become more internationalized in lieu of outsourcing.

CURRENT SCENARIO
The global passenger car industry has been facing the problem of excess capacity for quite sometime now. For the year 2002, the global capacity in the automotive industry was 75 million units a year, against production of only 56 million units (excess capacity estimated at 25%). Efforts to shore up capacity utilization have prompted severe price competition, thus affecting margins and forcing fundamental changes in the industry. The pressure on sales and margins is driving players to emerging markets in pursuit of better growth opportunities and/or access to low-cost manufacturing bases. The concept of selling in the passenger car industry is changing from original sales towards lifecycle value generation, encompassing financing, repairs & maintenance, cleaning, provision of accessories, and so on. Vehicle manufacturers are moving into completely new materials and technologiespartly guided by environmental legislationin striving to come up with radically different products. Some of these new technologies involve parts that can be bolted on to an existing vehicle with relatively few implications for the rest of the vehicle. Others are much more fundamental, and are likely to have a profound impact throughout the supply chain. The examples include battery, electric or hybrid power trains, and alternatives to the all-steel body. Carmakers are increasingly outsourcing component production, and focusing on product design, brand management and consumer care, in contrast to the traditional emphasis on manufacturing and engineering. The increasing need to attain global scales underscores the importance of platform sharing among carmakers. All original equipment manufacturers (OEMs) are trying to reduce the number of vehicle platforms, but raise the number of models produced from each platform. This means producing a number of seemingly distinct models from a common platform. As in manufacturing, distribution in the automobile industry is undergoing significant changes, involving Internet use, retailer consolidation, and unbundling of services provided by retailers.

INDIAN FOUR WHEELER INDUSTRY Evolution

The Indian automobile industry developed within the broader context of import substitution during the 1950s.The distinctive feature of the automobile industry in India was that in line with the overall policy of State intervention in the economy, vehicle production was closely regulated by an industrial licensing system till the early 1980s that controlled output, models and prices. The cars were built mostly by two companies, Premier Automobiles Limited and HM. However, the Indian market got transformed after 1983 following the relaxation of the licensing policy and the entry of MUL into the car market. In 1991, car imports were insignificant, while component imports were equivalent to 20% of the domestic production, largely because of the continuing import of parts by MUL. The liberalization of the Indian automotive industry that began in the early 1990s was directed at dismantling the system of controls over investment and production, rather than at promoting foreign trade. Multinational companies were allowed to invest in the assembly sector for the first time, and car production was no longer constrained by the licensing system. However, QRs on built-up vehicles remained and foreign assemblers were obliged to meet local content requirements even as export targets were agreed with the Government to maintain foreign exchange neutrality. The new policy regime and large potential demand led to inflows of foreign direct investment (FDI) by the mid-1990s. By the end of 1997, Daewoo, Ford India, GM, DaimlerChrysler and Peugeot had started assembly operations in India. They were followed by Honda, HMIL, and Mitsubishi.

Major Players

Bajaj Tempo Limited, DaimlerChrysler India Private Limited, Fiat India Automotive Private Limited, Ford India Limited, General Motors India Limited, Hindustan Motors Limited, Honda Siel Cars India Limited, Hyundai Motor India Limited, Mahindra & Mahindra Limited, Maruti Udyog Limited, Skoda Auto India Limited, Tata Motors Limited, Toyota Kirloskar Motors Limited.

Current scenario in Passenger Car Category

The dominant basis of competition in the Indian passenger car industry has changed from price to price-value, especially in the passenger car segment. While the Indian market remains price sensitive, the stranglehold of Economy models has been slackening, giving way to higher-priced products that better meet customer needs. Additionally, a dominant trend in the Indian passenger car segment is the increasing fragmentation of the market into sub-segments, reflecting the increasing sophistication of the Indian consumer. With the launch of new models from FY2000 onwards, the market for MUVs has been redefined in India, especially at the upper-end. Currently, the higher-end MUVs, commonly known as Sports Utility Vehicles (SUVs), occupy a niche in the urban market, having successfully shaken off the tag of commercial vehicles attached to all MUVs till recently. Domestic car manufacturers are now venturing into areas such as car financing, leasing and fleet management, and used-car reconditioning/sales, to complement their mainstay-business of selling new cars.

COMPETITIVE FORCES IN INDIAN PASSENGER CAR MARKET

Critical Issues and Future Trends The critical issue facing the Indian passenger car industry is the attainment of break-even volumes. This is related to the quantum of investments made by the players in capacity creation and the selling price of the car.

Threat from the new players: Increasing Most of the major global players are present in the Indian market; few more are expected to enter. Financial strength assumes importance as high are required for building capacity and maintaining adequacy of working capital. Access to distribution network is important. Lower tariffs in post WTO may expose Indian companies to threat of imports.

Market strength of suppliers: Low A large number of automotive components suppliers. Automotive players are rationalizing their vendor base to achieve consistency in quality.

Rivalry within the industry: High There is keen competition in select segments. (compact and mid size segments). New multinational players may enter the market.

Market strength of consumers: Increasing Increased awareness among consumers has increased expectations. Thus the ability to innovate is critical. Product differentiation via new features, improved performance and after-sales support is critical. Increased competitive intensity has limited the pricing power of manufacturers.

Threat from substitutes: Low to medium With consumer preferences changing, inter product substitution is taking place (Mini cars are being replaced by compact or mid sized cars).

The amount of investment in capacities by passenger car manufacturers in turn depends on the productionstrategies of the car manufacturers. Setting up integrated manufacturing facilities may require higher capital investments than establishing assembly facilities for semi knocked down kits or complete knocked down kits. In recent years, even though the ratio of sales to capacity (an important indicator of the ability to reach break-even volumes) of the domestic car manufacturers have improved, it is still low for quite a few car manufacturers in India. India is also likely to increasingly serve as the sourcing base for global automotive companies, and automotive exports are likely to gain increasing importance over the medium term. However, the growth rates are likely to vary across segments. Although the Mini segment is expected to sustain volumes, it is likely to continue losing market share; growth in the medium term is expected to be led largely by the Compact and Mid-range segments. Additionally, in terms of engine capacity, the Indian passenger car market is moving towards cars of higher capacity. This apart, competition is likely to intensify in the SUV segment in India following the launch of new models at competitive prices.

KEY STRATEGIC INITIATIVES BY MARUTI

A) TURNAROUND STRATEGIES MARUTI FOLLOWED Maruti was the undisputed leader in the automobile utility-car segment sector, controlling about 84% of the market till 1998. With increasing competition from local players like Telco, Hindustan Motors, Mahindra & Mahindra and foreign players like Daewoo, PAL, Toyota, Ford, Mitsubishi, GM, the whole auto industry structure in India has changed in the last seven years and resulted in the declining profits and market share for Maruti. At the same time the Indian government permitted foreign car producers to invest in the automobile sector and hold majority stakes. In the wake of its diminishing profits and loss of market share, Maruti initiated strategic responses to cope with Indias liberalization process and began to redesign itself to face competition in the Indian market. Consultancy firms such as AT Kearney & McKinsey, together with an internationally reputed OD consultant, Dr. Athreya, have been consulted on modes of strategy and organization development during the redesign process. The redesign process saw Maruti complete a Rs. 4000 mn expansion project which increased the total production capacity to over 3,70,000 vehicles per annum. Maruti executed a plan to launch new models for different segments of the market. In its redesign plan, Maruti, launches a new model every year, reduce production costs by achieving 85-90% indigenization for new models, revamp marketing by increasing the dealer network from 150 to 300 and focus on bulk institutional sales, bring down number of vendors and introduce competitive bidding. Together with the redesign plan, there has been a shift in business focus of Maruti. When Maruti commanded the largest market share, business focus was to sell what we produce. The earlier focus of the whole organization was "production, production and production" but now the focus has shifted to "marketing and customer focus". This can be observed from the changes in mission statementof the organization: 1984: "Fuel efficient vehicle with latest technology". 1987: "Leader in domestic market and be among global players in the overseas market". 1997: "Creating customer delight and shareholders wealth". Focus on customer care has become a key element for Maruti. Increasing Maruti service stations with the scope of one Maruti service station every 25 km on a highway. To increase its market share, Maruti launched new car models, concentrated on marketing and institutional sales. Institutional sales, which currently contributes to 7-8% of Marutis total sales. Cost reduction and increasing operating efficiency were another redesign variable. Cost reduction is being achieved by reaching an indigenization level of 85-90 percent for all the models. This would save foreign currency and also stabilize prices that fluctuate with exchange rates. However, change in the mindset was not as fast as required by the market. Maruti planned to

reduce costs, increase productivity, quality and upgrade its technology (Euro I&II, MPFI). In addition, it followed a high volume production of about 400,000 vehicles / year, which entailed a smooth relationship between the workers and the managers. Post 1999, the market structure changed drastically. Just before this change, Maruti had wasted two crucial years (1996-1998) due to governmental interventions and negotiation with Suzuki of Japan about the break-up of the share holding pattern of the company. There was a change in leadership, Mr. Sato of Suzuki became the Chairman in June 1998, and the new Mr.J. Khatter was appointed as the new Joint MD. Khatter was a believer in consensus decision making and participative style of management.As a result of the internal turmoil and the changes in the external environment, Maruti faced a depleting market share, reducing profits, and increase in inventory levels, which it had not faced in the last 18 years. After their fall in market share they redesigned their strategies and through their parent company Suzuki they learned a lot.The organizational learning of Maruti was moderately successful, the cost was relatively inexpensive as Maruti had its strong Japanese practices to fall back upon. With the program of organizational redesign, rationalization of cost and enhanced productivity, Maruti bounced back to competition with 50.8% market share and 40% rise in profit for the FY2002-2003.

B) CURRENT STRATEGIES FOLLOWED BY MUL I. PRICING STRATEGY - CATERING TO ALL SEGMENTS

Maruti caters to all segment and has a product offering at all price points. It has a car priced at Rs.1,87,000.00 which is the lowest offer on road. Maruti gets 70% business from repeat buyers who earlier had owned a Maruti car. Their pricing strategy is to provide an option to every customer looking for up gradation in his car. Their sole motive of having so many product offering is to be in the consideration set of every passenger car customer in India. Here is how every price point is covered.

II. OFFERING ONE STOP SHOP TO CUSTOMERS OR CREATING DIFFERENT REVENUE STREAMS Maruti has successfully developed different revenue streams without making huge investments in the form of MDS, N2N, Maruti Insurance and Maruti Finance. These help them in making the customer experience hassle free and helps building customer satisfaction. Maruti Finance: In a market where more than 80% of cars are financed, Maruti has strategically entered into this and has successfully created a revenue stream for Maruti. This has been found to be a major driver in converting a Maruti car sale in certain cases. Finance is one of the major decision drivers in car purchase. Maruti has tied up with 8 finance companies to form a consortium. This consortium comprises Citicorp Maruti, Maruti Countrywide, ICICI Bank, HDFC Bank, Kotak Mahindra, Sundaram Finance, Bank of Punjab and IndusInd Bank Ltd.( erstwhile-Ashok Leyland Finance). Maruti Insurance : Insurance being a major concern of car owners. Maruti has brought all car insurance needs under one roof. Maruti has tied up with National Insurance Company, Bajaj Allianz, New India Assurance and Royal Sundaram to bring this service for its customers. From identifying the most suitable car coverage to virtually hassle-free claim assistance it's your dealer who takes care of everything. Maruti Insurance is a hassle-free way for customers to have their cars repaired and claims processed at any Maruti dealer workshop in India. True Value Initiative to capture used car market

Another significant development is MUL's entry into the used car market in 2001, allowing customers to bring their vehicle to a 'Maruti True Value' outlet and exchange it for a new car, by paying the difference. They are offered loyalty discounts in return.This helps them retain the customer. With Maruti True Value customer has a trusted name to entrust in a highly unorganized market and where cheating is rampant and the biggest concern in biggest driver of sale is trust. Maruti knows its strength in Indian market and has filled this gap of providing trust in Indian used car market. Maruti has created a system where dealers pick up used cars, recondition them, give them a fresh warranty, and sell them again. All investments for True Value are made by dealers. Maruti has build up a strong network of 172 showrooms across the nation.The used car market has a huge potential in India. The used car market in developed markets was 2-3 times as large as the new car market. N2N:Car maintenance is a time-consuming process, especially if you own a fleet. Marutis N2N Fleet Management Solutions for companies, takes care of the A-Z of automobile problems. Services include end-to-end backups/solutions across the vehicles life: Leasing, Maintenance, Convenience services and Remarketing. Maruti DrivingSchool (MDS): Maruti has established this with the goal to capture the market where there is inhibition in buying cars due to inability to drive the car. This brings that customer to Maruti showroom and Maruti ends up creating a customer.

III. REPOSITIONING OF MARUTI PRODUCTS

Whenever a brand has grown old or its sales start dipping Maruti makes some facelifts in the models. Other changes have been made from time to time based on market responses or consumer feedbacks or the competitor moves. Here are the certain changes observed in different models of Maruti.

Omni has been given a major facelift in terms of interiors and exteriors two months back. A new variant called Omni Cargo, which has been positioned as a vehicle for transporting cargo and meant for small traders. It has received a very good response from market. A variant with LPG is receiving a very good response from customers who look for low cost of running. Versa prices have been slashed and right now the lowest variant starts at 3.3 lacs. They decreased the engine power from 1600cc to 1300cc and modified it again considering consumers perception. This was a result of intensive survey done all across the nation regarding the consumer perception of Versa. Esteem has gone through three facelifts. A new look last year has helped boost up the waning sales of Esteem. Baleno was launched in 1999 at 7.2 lacs. In 2002 they slashed prices to 6.4 lacs. In 2003 they launched a lower variant as Baleno LXi at 5.46 lacs. This was to reduce the price and attract customers. Wagon-R was perceived as dull boxy car when it was launched. This made it a big failure on launch. Then further modifications in engine to increase performance and a facelift in the form of sporty looking grills on the roof. Now its of the most successful models in Maruti stable. Zen has been modified four times till date. They had come up with a limited period variant called Zen Classic. That was limited period offer to boost short term sales. Maruti 800 has so far been facelifted two times. Once it came with MPFi technology and other time it came up with changes in front grill, head light, rear lights and with round curves all around.
IV. CUSTOMER CENTRIC APPROACH

Marutis customer centricity is very much exemplified by the five times consecutive wins at J D Power CSI Awards. Focus on customer satisfaction is what Maruti lives with. Maruti has successfully shed off the public- sector laid back attitude image and has inculcated the customer-friendly approach in its organization culture. The customer centric attitude is imbibed in its employees. Maruti dealers and employees

are answerable to even a single customer complain. There are instances of cancellation of dealerships based on customer feedback. Maruti has taken a number of initiatives to serve customer well. They have even changed their showroom layout so that customer has to walk minimum in the showroom and there are norms for service times and delivery of vehicles. The Dealer Sales Executive, who is the first interaction medium with the Maruti customer when the customer walks in Maruti showroom, is trained on greeting etiquettes. Maruti has proper customer complain handling cell under the CRM department. The Maruti call center is another effort which brings Maruti closer to its customer. Their Market Research department remains on its toes to study the changing consumer behaviour and market needs.Maruti enjoys seventy percent repeat buyers which further bolsters their claim of being customer friendly. Maruti is investing a lot of money and effort in building customer loyalty programmes. V. COMMITTED TO MOTORIZING INDIA Maruti is committed to motorizing India. Maruti is right now working towards making things simple for Indian consumers to upgrade from two-wheelers to the car. Towards this end, Maruti partnerships with State Bank of India and its Associate Banks took organized finance to small towns to enable people to buy Maruti cars. Rs. 2599 scheme was one of the outcomes of this effort. Maruti expects the compact cars, which currently constitute around 80% of the market, to be the engine of growth in the future. Robust economic growth, favorable regulatory framework, affordable finance and improvements in infrastructure favor growth of the passenger vehicles segment. The low penetration levels at 7 per thousand and rising income levels will augur well for the auto industry. Maruti is busy fine-tuning another innovation. While researching they found that rural people had strange notions about a car - that the EMI (equated monthly instalments) would range between Rs 4,000 and Rs 5,000. That, plus another Rs 1,500-2,000 for monthly maintenance, another Rs 1,000 for fuel (would be the cost of using the car). To counter that apprehension, the company is working on a novel idea. Control over the fuel bill is in the consumer's hands. But, maintenance need not be. Says Khattar: "What the company is doing now is saying how much you spend on fuel is in your hands anyway. As far as the maintenance cost is concerned, if you want it that way, we will charge a little extra in the EMI and offer free maintenance."

VI. DISINVESTMENT AND IPO OF MARUTI UDYOG LIMITED It was a long and tough journey, but a rewarding one at the end. A reward worth Rs 2,424 crore, making it the biggest privatization in India till date. The size of Marutis sell- off deal is proof of its success. On the investment of Rs 66 crore it made in 1982, when Maruti Udyog Limited (MUL) was formally set up, the sale represents a staggering return of 35 times The best part of the deal is the Rs 1,000 crore control premium the Government has been able to extract from Suzuki Motor Corporation for relinquishing its hold over Indias largest car company. Now looking at the strategy point of it for Suzuki, of course, complete control of MUL means a lot. Maruti is its most profitable and the largest car company outside Japan. Suzuki will now be in the drivers seat and will not have to mind the whims and fancies of ministers and bureaucrats. Decisions will now become quicker. The response to changing market conditions and technological needs will be faster, says Jagdish Khattar, managing director, MUL. After the disinvestment Suzuki became the decision maker at MUL. They flowed fund in India for the major revamp in MUL. Quoting from the report that appeared in The Economic Times, 4th April 2005, The Indian car giant Maruti Udyog Limited has finalized its two mega investment plans a new car plant and an engine and transmission manufacturing plant. Both the projects will be implemented by two different companies. At its meeting the company's board approved a total investment of Rs3,271.9 crore for these two ventures, which will be located in Haryana. The above signifies when GOI was a major stakeholder in the MUL strategi es which
lead to investment have had a bureaucracy factor in it but after the disinvestment strategy followed is a TOP DOWN approach with a fast implementation. Suzuki's proposed two-wheeler facility in India, would start making motorcycles and scooters by the end of 2005 through a joint venture, in which Maruti has 51 per cent stake. The two-wheeler unit will have a capacity of 250,000 units a year. The disinvestment followed by IPO gives the insight in the fact that now all the strategic decisions are taken by Maruti Suzuki Corporation. Disinvestment had helped by removing the red tape and bureaucracy factor from its strategic decision making process.

VII. REALISATION OF IMPORTANCE OF VEHICLE MAINTENANCE SERVICES MARKET

In the old days, the company's operations could be boiled down to a simple three-box flowchart. Components came from the 'vendors' to the 'factory' where they were assembled and then sent out to the 'dealers'. In this scheme, you know where the company's revenues come from. The new scheme is more complicated. It revolves around the total lifetime value of a car. Work on this began in 1999, when a MUL team, wondering about new revenue streams, traveled across the world. Says R.S. Kalsi, general manager (new business), MUL: "While car companies were moving from products to services, trying to capture more of the total lifetime value of a car, MUL was just making and selling cars." If a buyer spends Rs 100 on a car during its entire life, one-third of that is spent on its purchase. Another third went into fuel. And the final third went into maintenance. Earlier, Maruti was getting only the first one-third of the overall stream. As the Indian market matured, customers began to change cars faster. Says Kalsi: "So the question was, if a car is going to see three users in, say, a life span of 10 years, how can I make sure that it comes back to me each time it changes hands ? So Maruti has changed gears to take a big share of this final one-third spent on maintenance. Maintenance market has a huge market potential. Even after having fifty lakh vehicles on road Maruti is only catering to approximately 20000 vehicles through its service stations everyday. For this they are conducting free service workshops to encourage consumers to come to their service stations. Maruti has increased its authorized service stations to 1567 across 1036 cities. Every regional office is having a separate services and maintenance department which look after the growth of this revenue stream. VIII. PLAYING ON COST LEADERSHIP Maruti is the price dictator in Indian automobile industry. Its the low cost provider of car. The lowest car on road is from Maruti stable i.e. Maruti 800. Maruti achieves this through continuous improvements in operational efficiency and productivity. The company has set itself (and its vendors) the target of a 50% improvement in productivity and a 30% reduction in costs in three years. The ability to keep lowering the prices sets Maruti apart from other players in the league. Maruti spread the overheads over a larger base. The impressive sales and profits were the result of major efforts within the company. Maruti also increased focus on vendor management. Maruti consolidated its vendor

base. This has provided its vendors with higher volumes and higher efficiencies. Maruti does that by working with vendors, assuring them that for every drop in price, volumes will go up. Maruti is now encouraging its vendors to develop R&D capability for specialized components. Based upon such activities, product competitiveness in the market will further increase. Maruti also made strides in applying IT to manufacturing. A new Vehicle Tracking System improved efficiency on the shop floor and enhanced quality control. The e Nagare system, adopted from Suzuki Motor Corporation, smoothened Marutis Just In Time operations.

CASE STUDY ON STRIKE ON PRODUCTION PLANT AT MANESAR (HARYANA)

Case study on Maruti SuZuki India Ltd Employees Strike Earlier, on June 4, workers at the plant had gone on a 13-day-long strike demanding the recognition of a new union, the Maruti Suzuki Employees Union (MSEU). Introduction: Differences in salary pay: Introduction: Differences in salary pay In the Gurgaon plant the salary of skilled workers adds to 30,000 40,000 Rs including the overtime and incentives, whereas the skilled labourers at Manesar get only around 13,000 to 17,000 Rs. It was a hard strike. The workers gave no notice to management, they stopped production completely and around 2,000 workers stayed inside the factory for nearly two weeks. The strike postponed the production of 13,200 cars and caused a loss of about 6 billion Rs. (133 million USD / 100 million Euro). Maruti Suzukis June sales figures dropped by 23 per cent, the sharpest fall in two and a half years.

Workers continued the strike despite the police stationed within the factory premises and despite strike having been officially declared illegal by Haryana government on 10th of June. The strike stopped production at around 200 local supplying factories, but no active connections were established between Maruti workers and the wider work-force in the territory. The main reasons for the defeat of the strike as follows: workers raised direct demands, but early on these demands were integrated in the workers hope that by formal recognition of an independent union their material situation would improve. An attack both by management and state, cutting of electricity, isolation of workers by army of security guards, declaring the strike formerly illegal and last but not least by sacking the 11 leaders; the main unions then offered support and at the same time focussed the struggle on the question of taking back the leaders and workers rights for representation. The fate of the strike was handed over to the negotiating forces. It is inexpert to repeat the phrase of unfaithfulness of the main unions. It evades the question of what gives them the power to betray in the first place. Haryana state sources a fair chunk of tax revenue from Maruti Suzuki. In 2010 the company paid around 13 billion Rs. tax to the regional state. The Working Conditions There are around 3,500 to 4,000 workers employed in the factory, but their status differs significantly. Around 900 to 1,300 workers are permanent workers, around 800 to 1,000 trainees, around 400 apprentices and around 1,000 to 1,200 temporary workers hired through contractors. Permanent workers at Manesar compared their wages to the wages of permanent workers at nearby Honda, Hero Honda or Maruti Gurgaon plant and voiced anger about the fact that they earn only half as much. The production capacity of Maruti has gone up from 10 lakh units in 2009-10 to 12.7 lakh units in 2010-11, but our salary has not gone up at all. Where is the incentive for hard work? Development of the Strike: Development of the Strike The company knew that trouble was brewing, they knew that some workers planned on registering a separate union and the company had already prepared legal documents for a possible expulsion of workers from the premises. Maruti Suzuki management tried to back a single union, the Maruti Suzuki Kamgar Union, for both Gurgaon and Manesar plant. This union had been set-up by forces close to management after the lockout at Gurgaon plant in 2000/2001. On 3rd of June, eleven leaders of the workers went to Chandigarh to meet the Labour Department to complete the formalities regarding registration of our union on June 3, 2011. On the morning of that day, the labour department officials faxed the news of our application to the management. On the morning of June 4, 2011, through struggle, we were able to retrieve some of the blank signed papers from the management. By the afternoon, it became clear that the management was using all kind of tricks to break our unity. In such circumstances, we were forced to go on flash tool down strike from the afternoon of June 4, 2011.

On the 4th of June after the change between morning and late shift around 2,000 workers stop work and remain in factory. Later on, the C-shift would not be refused entry by management and these workers largely remained outside the factory. During this initial stage, workers raised various issues and demands: low wages, incentive cuts, few breaks. The workers have demanded that the temporary workers should be given preference for permanent posts in new departments, which the company is currently building on the premises. Management reaction : Management reaction On 5th and 6th of June management sealed the gates and placed a row of security guards in front of them in order to prevent exchange between workers inside and outside, between workers and supporters and media. Management also restricted water, food, electricity and toilet access. Only after a demonstration outside the gate on 6th of June, the food supply through family and friends was permitted again. Eleven workers were officially dismissed on the 6th of June. Police was deployed both inside and outside the premises. Entrance of mediators into issue: Entrance of mediators into issue On the 8th of June the main unions AITUC, CITU, HMS, INTUC, UTUC formed a joint action committee to support the strike. Although this committee dominated by AITUC had no formal link with neither the Maruti workers nor the new Maruti union in formation, it became the main broker and spokesperson of the strike. Often quoted representatives were union leaders from Honda HMSI, Hero Honda Dharuhera and Rico Auto. On the 9th of June this action committee mobilised workers of 50 to 60 factories in Gurgaon , around 1,000 to 2,000 union members gathered in front of the gates. Sachdeva , secretary, AITUC, said, As we are a major union in this area, its our prime responsibility to support any cause that involves the rights of our affiliated workers. 10th of June the over-all pressure on the striking workers increased and pushed them further into the arms of the main unions. State government supported MSIL: State government supported MSIL The Haryana government has, under the provisions of the Industrial Depute Act, 1947, referred the matter of ongoing strike in Maruti Suzuki Udyog Ltd, Manesar , by the workers to the competent labour court and has also passed the orders prohibiting the continuance of the strike in the industrial unit, Minister of State for Labour and Employment Shiv Charan Lal Sharma said in a statement. The strike was officially called illegal. Strike call off: Strike call off On the 16th of June Maruti management told the media that it would try to revive production lines in the Gurgaon plant in case the strike dragged on for longer unnecessarily so, because a day later, on 17th of June, the dispute was settled. The workers were represented by leader of the proposed new union Maruti Suzuki Employees Union Shiv Kumar and national secretary of AITUC Sachdev . The company has now agreed that we would not be asked to sign the paper. Also, the fact that Maruti took back the 11 workers shows that our demands were met, said Shiv Kumar.

Strike again: Strike again July 28, 2011 | 17:05 , Just over a month after they called off a 13-day-long stir that resulted in a loss of about Rs 630 crore , workers at Maruti Suzuki India's Manesar plant went on strike again on Thursday afternoon. The workers resorted to a strike when five of them were suspended for "allegedly assaulting a supervisor" on Wednesday. Workers of Suzuki Powertrain India Ltd and Suzuki Motorcycle India Pvt Ltd, located in the Gurgaon-Manesar industrial belt, declared a strike at 3-45 p.m on Wednesday. Workers from Suzuki Castings a part of Suzuki Powertrain India Ltd affiliated to the Suzuki Powertrain India Employees' Union also joined the strike. On Tuesday MSI management dismissed five more workers on charges of attacking on three supervisors and a worker last Friday and hired 100 strike breakers to replace workers who have refused to sign the good conduct bond. Consequences: Haryana Labour Commissioner Satwanti Ahlawat declared the governments support for the company, saying: Whatever the bond that the management (MSI) is asking its workers to sign is as per rule and workers will have to sign it. Isolated by the AITUC bureaucracy and under pressure from the employers, over 100 locked-out workers have signed the good conduct bond. October 13, 2011 Haryana government on declared strike by workers at Maruti -Suzuki's Manesar plant as illegal. The strike on Thursday entered seventh day as workers continue to demand that the management take back all suspended and casual employees. Suzuki India Ltd. has incurred a revenue loss of 15 billion rupees ($306.7 million) since Aug. 29 due to labor woes at one of its factories that have severely impacted vehicle output at the country's largest car maker by sales. Negotiations: Negotiations The Haryana government signed separate pacts with MSI and its arms Suzuki Powertrain India Ltd (SPIL) and Suzuki Motorcycle India Pvt Ltd (SMIPL) and their respective workers' bodies to end the stir. Haryana government-brokered negotiations between Maruti Suzuki India management and its workers to end the standoff at MSIs Manesar plant failed today. Haryana Minister for Labour and Employment Shiv Charan Lal Sharma held talks with the companys management and workers of the Manesar plant along with representatives of MSIs recognised union Maruti Udyog Kamgar Union (MUKU) through the day but an agreement proved elusive. The workers were apologetic about the production loss that MSI has suffered and also about yesterdays violent incident, but they are insisting that the dismissed and suspended colleagues must be taken back, Sharma said. Conclusion: Conclusion In response to the workers request for transport, the company agreed to provide bus services in line with shift timings. To address the concerns of the Manesar workers, the company has agreed to set up a grievance redressal committee.

The committee will have representatives from the management and the workers. A labour officer from the state government will be a permanent invitee to it and review its proceedings. Maruti Suzuki has also agreed to the formation of a labour welfare committee to promote good relations between the management and the workers. The committee will comprise members of the management and the workers.

ADD-ON SERVICES

Ask any thing about Maruti. Anytime, call 1800 1800 180 ( Toll Free ). Mobile +91 9910 20 20 20

Maruti On road Service. Just dial 39891515 for a 24-hour on-road breakdown service in many cities. No other car company can match this.

Maruti Genuine Parts. Maruti Suzuki spares are easily available across the length and breadth of the country.

Maruti forever yours service include an extend of warranty with very reasonable rate.

Express Highway Service introduced with service stations at convenient points on important national highways.

Many of the auto component companies other than Maruti Udyog started to offer components and accessories that were compatible. This caused a serious threat and loss of revenue to Maruti. Maruti started a new initiative under the brand name Maruti Genuine Accessories to offer accessories like alloy wheels, body cover, carpets, door visors, fog lamps, stereo systems, seat covers and other car care products. These products are sold through dealer outlets and authorized service stations throughout India.

Maruti True service offered by Maruti Udyog to its customers. It is a market place for used Maruti Vehicles. One can buy, sell or exchange used Maruti vehicles with the help of this service in India.

As part of its corporate the MarutiDrivingSchool other cities of India as international standards,

social responsibility Maruti Udyog launched in Delhi. Later the services were extended to well. These schools are modeled on

where learners go through classroom and

practical sessions. Many international practices like road behavior and attitudes are also taught in these schools. Before driving actual vehicles participants are trained on simulators.

N2N is the short form of End to End Fleet Management and This fleet management service include end-to-end solutions across the vehicle's life, which includes Leasing, Maintenance, Convenience services and Remarketing.

QUESTIONNAIRE
Name: Address: Contact No:Age of Respondent a) <25 c) 35-44 b) 25-34 d)45 & above Sex:Occupation:-

Annual Income a) 3-5 lack c) 8-12 lack

b) 5-8 lack d) 12 and above

1. Which Model of Maruti are you using? Car:- 2. From how many years you are using this model? a) 0-2 years c) 4-6 years b) 2-4 years d) 6-8 years

3. Preference for choosing particular car? a) Comfort c) Feature e) Looks g) Others Please specify:- b) Mileage d) Performance f) Price

4. Are you satisfied with your car?

a) Yes b) No If No, give the reasons for the same a) Comfort c) Feature e) Looks b) Mileage d) Performance f) Price

1. From which of the following add- services are you unaware? a) MTV c) M-Insurance e) Any time Maruti b) MGP b) M-Finance d) Maruti on road services f) MGA h) Maruti Extend warranty

6. Do you prefer M-Insurance over any other insurance option? a) Yes b) No If No, then why:-.

7. Do you prefer M-Finance over any other finance option? a. Yes b. No If No, then why:-.

8. Do you prefer to get MGA fitted in your car or any local accessories? a) MGA b) Local

9. What is your Pre-sales experience while purchasing the car? a) Excellent b) Good

c) Average

d) Below Average

10. What is your Post-sales experience after purchasing the car? a) Excellent c) Average b) Good d) Below Average

11. Are you satisfied with the features of Maruti? c. Comfort. /5 b) Mileage. /5 d) Safety. /5 f) Price. /5

c) Feature . /5 e) Looks . /5

12. How will you rate Maruti on the basis of Value for Money? a) Above Expectation b) Below Expectation c) As per Expectation

13. Do you find easy availability of spare parts? a) Yes b) No

14. Would you like to re purchase the Marutis car? a) Yes b) No

15. Would you like to recommend the Maruti car to your friends/relatives? a) Yes b) No

16. In which sector do you think/feel Maruti should improve? a) Price c) Service b) Quality d) Others

17. Are you satisfied with the overall service of Maruti? a) Excellent c) Average b) Good d) Below Average

CONCLUSION
It has been observed that most customers are satisfied with pre sales services similarly most of these customers are dissatisfied with the post sales service which is the matter of concern for the company. Maruti Suzuki needs to improve some parts of products specifically the interiors. High customer satisfaction level helps the company to retain its existing customer as well as generate new customer through word to mouth publicity. Customer satisfaction index is a good tool to make improvements in the products and services of the company. And therefore should utilize carefully & kept as confidential as possible.

SUGGESTIONS
SUGGESTION
After conducting the survey and knowing the market, I realized that: The company should keep in mind the need of young generation. Company should improve the promotion strategy of product. Company should improve the promotion strategy of Add-on services. It will be beneficial for the company to make the warehouse near to the showroom and there should be roof facility, adequate security facility in the warehouse. The Company should know its customers satisfaction level throughout doing periodic surveys. Periodic surveys can treat customer satisfaction directly. Company should improve/upgrades its employees product knowledge, market situation, and its competitors knowledge by giving proper training to employee. Company should upgrade or innovate its new product. The Company should not only concentrate on the customer satisfaction but also the company led to monitor their competitors performance in their areas of operations. The Company should make changes according to the other competitors & according to the customers expectations.

LIMITATIONS
LIMITATIONS OF STUDY:
Though the research was conducted properly, the probability of errors & biases kept is minimum; still some errors occurred because of certain limitation. These are as follows:a) A very short span of time for research. b) This is time-consuming research method & the respondents did not have sufficient time for giving information for such type of research. c) People were reluctant to give responses for such type of research. d) People also did not give proper response for Questionnaire & interview, because of short time. e) Study is restricted to only Amravati city. I have honestly and sincerely tried to present the facts and figures but some error still might have cropped up.

FINDINGS
Findings
It is observed that 1. The prospective segment is from the business and self employed class. 2. The company should concentrate on the age group 26-34. 3. Maruti should continue to maintain the standard of the service. 4. It is observed that, 42% of the respondent are of opinion that vehicles are as per expectation, and 20% are saying its below expectation. 5. Company should improve its post sales service. 6. The customer highest priority is for the mileage. 7. Maruti Suzuki needs to improve its awareness about Add-on-Services like any time Maruti, MEW etc. 8. Customer are highly satisfied with the service which help in customer retention 9. It is observed that, 46% of the customers are of opinion that Maruti should improve in quality, and 16% of the opinion that Maruti should improve in price. 10. Customers are highly satisfied which help in customer retention. 11. Company has created goodwill among the customers which will help them to recommend car to friends and relatives. 12. Maruti Suzuki needs to educate the customers about the benefits of MFinance. They can motivate the cash customers to offer M-Finance. 13. It is observed that, 86% of the customers are ready to prefer M-Insurance, 14% are not ready to preferM-Insurance

BIBLIOGRAPHY

BIBLIOGRAPHY
2. Marketing Management by Philip Kotler, the millennium edition 3. Research Methodology-C.R. Kothari.2ndedition 4. Website visited www.marutisuzuki.com www.automotive.com www.marutiudyog.com

5. Newspaper-business standards, Dainak Gajran, Times of India, etc.