2011 Strategic Management Project Report Submitted to: Rajesh S Upadhyayula

Submitted By: PGP/14/260 NITESH KUMAR GUPTA PGP/14/280 MAHTAAB KAJLA PGP/14/287 PRACHI CHAWLA PGP/14/290 RAHUL MITTAL PGP/14/313 VINNY ARYA PGP/14/315 VISHAD DUBEY

India Yamaha Motors Limited

Table of Contents EXECUTIVE SUMMARY .......................................................................................................................... 2 INTRODUCTION ........................................................................................................................................ 3 OUR FOCUS ................................................................................................................................................ 3 YAMAHA INDIA- A BACKGROUND AND NEED FOR CHANGE IN STRATEGY ....................... 3 YAMAHA‟S CHANGING STRATEGY ..................................................................................................... 4 EXTERNAL ENVIRONMENTAL ANALYSIS ......................................................................................... 5 INDUSTRY ANALYSIS - Two Wheeler Geared Bikes .............................................................................. 8 INDUSTRY ATTRACTIVENESS......................................................................................................... 10 COMPETITIOR‟S ANALYSIS ................................................................................................................. 11 INTERNAL ENVIRONMENT ANALYSIS .............................................................................................. 11 VALUE CHAIN ANALYSIS..................................................................................................................... 11 YAMAHA INDIA‟S RESOURCES ........................................................................................................... 13 TANGIBLE RESOURCES .................................................................................................................... 13 INTANGIBLE RESOURCES ................................................................................................................ 13 YAMAHA INDIA‟S CAPABILITIES ................................................................................................... 14 RESOURCES CAPABILITIES......................................................................................................... 14 YAMAHA‟S CORE COMPETENCIES .................................................................................................... 16 SWOT ANALYSIS .................................................................................................................................... 17 RECOMMENDATIONS ............................................................................................................................ 18 REFERENCES ........................................................................................................................................... 19 ANNEXURE-A Detailed competitor Analysis........................................................................................... 20 YAMAHA IN PREMIUM SEGMENT .................................................................................................. 20 HERO HONDA MOTORS LTD. ........................................................................................................... 20 HONDA MOTORCYCLES & SCOOTERS INDIA PRIVATE LIMITED .......................................... 21 BAJAJ AUTO Ltd. .................................................................................................................................. 22 TVS MOTORS ........................................................................................................................................ 22 Annexure B – Achievements of Premium Segment Bikes of Yamaha ....................................................... 23 Chapter: EXECUTIVE SUMMARY

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India Yamaha Motors Limited

EXECUTIVE SUMMARY Yamaha enjoyed a great start in India with its models RX100 and RX135. But, the government ban on two stroke bikes was the biggest breakthrough in Yamaha‟s success. They ran in losses for almost for a decade. Parent company Yamaha Motor Corporation (Japan) has decided to utilize its deep R&D for the Indian markets. Premium segment industry is unattractive for the new entrants due to need of huge initial capital investment. The industry is also affecting by other factors like availability of cars in the same price range, stiff competition. But, rise in per capita income of households, westernization etc. provides an opportunity for the existing players to capture the market. Through this research, we are analyzing one of the new strategies by India Yamaha Motors Private Limited to enter into the premium segment bikes in India. Our research will be focusing to analyze the industry, to study internal and external forces affecting the decision of the company. In this research we have used various strategic tools and frameworks to support our analysis, took the help from various web and literary resources which is given in references section. Yamaha‟s main problems were identified as a late entry in the market, operational inefficiencies and not following aggressive selling. As compared to their competitors, their capabilities are not per standard in the current scenario. However, parent company‟s financial and technological support facilitates company to show their core competencies to the customers. To improve, Yamaha should focus to increase its production capacities. They should utilize their premium technology by giving focus to introduce new range of products to satisfy the consumer needs. They should also give importance to market the product well.

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Chapter: EXECUTIVE SUMMARY

Figure 3 Annexure A]. a Japanese company entered in India in 1980s through the acquisition of Escorts Motors Private Limited in 1999. It forayed into the market with Yamaha RX100 and RX135 in the mid-nineties.000. Premium bikes segment consists of the motorbikes with an engine power of 150-250cc. They adopted a turnaround strategy of involving structural. It is the second largest manufacturer of motorbikes in the world after Honda. Yamaha India suffered an operating loss of Rs. Still. 125cc. In India. 00. OUR FOCUS The premium bikes segment has emerged as the biggest growth segment in India because economy is booming and people moving up the salary bracket. The motorbikes market is considered as a big bull of Indian automobiles industry. 50. 300000-Rs. Yamaha India etc aim to provide efficiency and comfort ability without compromising on the fun and thrill of riding. 150-250cc and above 250cc bike. These companies provide various variants of motorbikes to satisfy all the types of consumers in the country. shortage of imported raw materials from Japan etc. In 2007-08. 2. 500000). attractive looks and comforts offered etc. With strong players like Hero Honda. Everything was going well until a government regulation came into force banning 2-stroke bikes and compelled Yamaha to pull out its bikes from the market.A BACKGROUND AND NEED FOR CHANGE IN STRATEGY Yamaha Motors. financial and marketing fronts.India Yamaha Motors Limited INTRODUCTION India is the second largest manufacturer of motorbikes in the world after China. In India. Bajaj Auto. inefficient operations strategy. there is a big scope for this industry to explore. The company on its part planned to cash in on the market . during which annual period sales of motorbikes in the country have grown by a multiple of 13. These bikes come under price range between Rs.000 to Rs. YAMAHA INDIA. only 31 out of every 1000 persons own motor bikes in India. huge margins in the segment have also led major players in the industry to focus on premium bikes. The basic target of every Motor Cycles company is the youth and middle-income households (RS. The factors for premium segment bikes in India can be the increasing income scales of the households. four different variants of motorbikes are available in the market with the power engines of 100cc. 40-45% of the motor bikes demand drives from urban India. 336 crores. In India. TVS. Later it introduced many new models but their success rate was poor despite the fact that the engines of theses bikes were among the best in the business. Several reasons why these models were not that successful were probably because of the choice of marketing. the share of motor bikes in the twowheeler industry has risen to 80% from 30% in the last decade and a half [Refer. There has also been an increase in distinctive and customized products. Besides growing demand.

Premium bike sales have in the meanwhile leaped up to over 15 per cent of total sales during 07-08. sales of which were growing y-o-y at 5% even as the total motorcycle sales in 2007-08 plunged by 12 per cent in the first ten months of the FY in 2007-08.sentiment of increasing tilt towards premium bikes. it realized the Indian market is viable for premium segment bikes and has shifted its focus from the lower end segments to the high-premium 3 Chapter: INTRODUCTION . After sufficient market research. Yamaha‟s niche in Japan is in racing bikes (high-premium segment) due to its high engine capacity which is its core competency.

India Yamaha Motors Limited segment. it is also optimistic about the FZ-16 series it has launched in the mid-market segment (150 cc) bikes. we can see that the aim is to provide niche products for the diverse customer segments. but the company has clearly indicated that it sees its future in the mid-market and premium segments. This kept it market share to below 5%.1 in customer satisfaction and is looking forward to providing the customer with an „experience‟ with its products. 4 . After launching models in premium segment like FZ1. In lieu of the growing Indian economy and the need for differentiator products. Olds who are willing to try taking the not so much treaded path of buying the „sports bike‟ rather than a „utility two wheeler ‟. just willing to limit itself to just prestige pricing. For example the company will be launching its new superbike in the 1000cc segment. it has seen an opportunity and attempted to leverage on it. 4) The target market of India Yamaha Motors is the young and enthusiastic 18-25 yr. This is its market differentiation strategy. From Cost Control to Market Differentiation -08. SZ and Fazer. f there is a pull. It will provide more value to the customer in terms of attributes like great technology. Its aim is to provide customers the full range of its engineering marvel. With the rising disposable income in India. So hence. 5) With the increasing dispensable income in India and growing middle and upper middle class segment Yamaha is sure to find many prospective customers. 2) Yamaha has a very strong focus on the technical department. superior design. ergonomics for long distance travelling etc. Apart from this. Yamaha has been following the cost control strategy by focusing on the low –end 100cc bikes like Crux and Alba. Yamaha revamped its strategy and shifted its focus to premium bikes. YAMAHA’S CHANGING STRATEGY 1) Yamaha has shifted its focus from the lower end segments to the premium segment of bikes. 3) Yamaha has aimed to become the No. the result of which can be seen with Yamaha comfortably leading the constructor‟s championship in the Superbikes racing with Valentino Rossi and Colin Edwards as their riders. Yamaha India is able to develop a brand image in front of their consumers. It aims to provide its customers the full range of its engineering marvels that make Yamaha the company that it is. These young guns are very conscious of the style quotient and look forward to their ride being a personality statement.

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thereby minimizing his loss of market share. introducing environment friendly engines. Yamaha’s Breadth Strategy Yamaha has globally forayed into an extensive range of products like motorcycles. reducing the size of the engines and introducing light weight and compact metals for its bikes. This will decrease the bargaining power of buyers. music instruments. scooters. It has come up with several innovations like improving fuel efficiency of the bikes.5% High per capita income results in higher disposable income with the buyers thereby making them less price sensitive. boats. Yamaha and Honda have been coming up with new higher models while the Bajaj industry has been upgrading its bikes model by only varying the cc engine. sail boats. watercrafts. racing karts etc EXTERNAL ENVIRONMENTAL ANALYSIS Political Environment Under the UPA rule most of the business from across all industries try and win over as much political support. It provides bikes for almost every market segment ranging from the 100cc Crux to the 1000cc FZ1. It is believed that Mr. outboard motors. Economy with an expected GDP of 8. Such political influences helps the incumbents to gain favorable bargains from the government making it difficult for new entrants to flourish thereby making Barriers to Entry high. Bajaj has used his political influence to raise the prices of the competitors‟ models. 5 .India Yamaha Motors Limited Yamaha can be described as a prospector (especially after the year 2007) as it has been constantly trying to explore new markets and opportunities. thus increasing barriers to entry. It aims at providing a diversified product range to satisfy a wide variety of customer preferences. Chapter: EXTERNAL ENVIRONMENTAL ANALYSIS Economic Environment or companies to arrange for funds for expansion but it effects the new entrants even more. The core competitor‟s viz.

To target common commuters. Deregulation of petrol has led to increase in prices and increase in commission to petrol pump owners and will continue the spiral This shall increase the cost of ownership of the vehicle thereby making them demand for more fuel efficient vehicles. DiASil Cylinder etc. are some things that many companies are looking forward to. This decreases the bargaining power of buyers as the product becomes more differentiated and companies woo new customers with innovative products. FZ & FZS. hese technology trends in its latest bikes i. Legal Environment .Yamaha SZ-Exit also launched sporty bikes like Yamaha Fazer 250 to cater young Indian population Technological Environment Chapter: EXTERNAL ENVIRONMENTAL ANALYSIS nd fuel efficiency has also seen major developments. the magnum wheels.Yamaha SZ . Yamaha Motor India launched 3 new bikes namely YBR 125. This increases the bargaining power of buyers as people start looking for that exclusive brand image and differentiation. India is getting westernized more and more by the day. As these companies are already very competent with high technologies and financial resources. back and front disc brakes. The expectations from buyers in this segment are very high since they look as their bikes as a style statement and a reflection of their attitude towards life. every customer keeps a basic knowledge about the standard technology required. Goods and Services Tax is expected by 2011 which is expected to remove the cascading effect caused due to multiplicity of taxes. Since the choice of the vehicle can save the buyer the running expenses. It also increases the competition in the industry thereby increasing the industry rivalry. The new technologies including the mono shockers. this shall make the Bargaining power of buyers high Socio Cultural Environment As education level in the country increases. Also with increasing globalization. the entry barrier will not be any issue and thus will increase the threat of competitors in the industry.India Yamaha Motors Limited foreign big giants like Harley Davidson to enter into the Indian market.e. Yamaha also developed CF Aluminum Die Casting Technology for mass production of Aluminum. This helped in reducing the weight of the parts. The public mentality that a two-wheeler is just for day-to-day commuting is changing and people are more and more moving towards premium bikes.

As discusses before. Indian Automobile Manufacturers (SIAM) 6 . Hence. it increases the bargaining power of buyers.the sector is driven by demands for fuel efficient automobile systems. the regulations on fuel efficiency are less.

In light of this Yamaha educates its employees about hazardous materials in products and has implemented LCA methodologies.45% from. Kawasaki Ninja. This shall compel the companies to invest in innovation and R&D thereby reducing their profits and making the industry unattractive for the new entrants thus decreasing the threat of new entrants. Another problem is the adherence to emission norms because of the lack of infrastructure for inspection. International Environment The two wheeler industry is currently growing at a CAGR of 9. Suzuki Hayabusa. These players cater to a very specific customer segment but due to the high margins make a profitable venture for players like Harley Davidson. However. and has thereby drawn the interest of a number of international players. This was accepted by all insurance firms after much deliberation. for long term sustainability in India every player will have to enter in the market in the premium segment range.India Yamaha Motors Limited covered the pillion rider on a two-wheeler should be offered by all the insurance firms. BMW etc. there will be a lot of pressure on the two-wheeler industry to come up with greener technologies. is some of the bikes which are already launched in India. Environmental Forces Demand for two wheelers is increasing and thereby overcrowding the roads. Suzuki Zeus. Increases the threat of new entrants and industry rivalry since more and more companies would soon be vying for the same customer segment which currently is not that large in size. Because of Euro II. 7 Chapter: EXTERNAL ENVIRONMENTAL ANALYSIS . Yamaha improved its production and air conditioning equipment to reduce greenhouse gas emissions.

E-Bikes: There are several players in this segment which includes YO bikes. . Although the speculation was there that after the launch of TATA NANO there might be a drop of 20% in growth of two wheelers. . OVERALL: Low/Medium Rationale: Indian two-wheeler premium bike industry has been able to create a niche for itself which primarily runs on three factors namely: Mileage/Maintenance Cost. features bikes like FZ. as consumer might want to buy a 4-wheeler which is available to them almost at comparable price. the decline is definitely there but not at such high extent. the parts are not highly differentiated when it comes to additional features and a huge number of small companies have already come up who manufacture such components. .Supplier’s product differentiation is low . OVERALL: Low Rationale: Even though the availability of high quality components is very critical for the auto manufacturers. for KMC it ‟s a win-win situation as Mahindra has global sourcing expertise and experience in building differentiated products. R15 would have an edge.The NANO Effect: TATA’s launch of 1 Lac car has obviously raised concerns for two wheeler automobile industry. .Most of the component work is outsourced proper supply chain management is costly yet needed. BARGAINING POWER OF SUPPLIERS THREAT OF SUBSTITUTES .The relative price of substitutes like E-bikes and Kinetic would be lower as compared to NANO but relative quality such as engine. with the increasing global prices of crude oil and gas the demand for such types of bikes is increasing slowly but in consistent fashion. This means that though this deal Kinetic will get the support of financial muscle of Mahindra Finance whereas.Supplier’s threat of forward integration is low as the capital investment required is very high and suppliers are small and fragmented. . BSA Electric bikes. India‟s largest tractor and utility vehicle maker has already bought the business assets of loss making scooter maker Kinetic Motor Company and has 80% of the share in JV by investing Rs 110 crore to gain an entry into the two-wheeler market.Two Wheeler Geared Bikes Kinetic Mahindra Deal – Gearless bikes: M&M.The switching costs in NANO’s case would be high but they would be getting a benefit of 4-wheeler but in case of E-Bikes and Gearless Bikes such as Kinetic Honda switching costs are not much high so in a country like India for female drivers and teens.Suppliers can influence the industry by deciding on the price at which the raw materials can be sold.India Yamaha Motors Limited INDUSTRY ANALYSIS . This is done in order to capture profits from the market The industry being capital intensive the switching costs of suppliers is high .Suppliers of auto components are fragmented and extremely critical for this industry. . Ebike India. Even though E-Bikes and Nano might be able to draw some customers away from geared bikes but they are still not capable enough to become the ride of the youth of the country who are more looking at it as a style statement. Karizma. Reliability and Style. . gearless bikes and E-bikes are preferred.

8 Chapter: Industry Analysis .Two Wheeler Geared Bikes .

Due to increase in number of models in all the categories. . Ducati (Priced up to Rs 10-45 lacs. TVS .HIGHER-END BIKES: Higher end bikes such as Kawasaki Ninja (Priced at Rs 2.The political influence of incumbents helps them get favors from the government which makes it difficult for new entrants to flourish .High expectations from buyers in terms of Styling and power .Importance of the product to buyers is high due to other factors like traffic congestion.1. . BMW bikes (Priced at Rs 18 lacs upwards and models like R 1200 GS. Since they have global presence and strong brand recognition worldwide. Bikes such as Yamaha R15. SBK and Sport Classic.After the liberalization policy of ‟91 barriers to entry for this segment has reduced and government regulations and taxes have been relaxed. but the customer base in high end market is not very significant. Desmosedici RR.g.Access to Distrubution channels would be tough and capital intensive if the new competitor doesn‟t tie up with any of existing player.Initial Capital Requirement for setting up production plant. R1 can face competition from these players.7 lacs.Industry growth rate(CAGR) in past decade is almost 10% which is definitely not so much lucrative after liberalization and India‟s GDP has grown up to 8% . . Hero Honda. Kawasaki has tie up with Bajaj Motor Limited) OVERALL: LOW Rationale: Looking at the high barriers to entry due to the initial capital requirements and other infrastructure like access to distribution channels and also the low growth rate.198cc engines) have also entered into India.Product differentiation definitely exists and whole industry is different from other industries . . the buyers are empowered to a large extent.Dealers threat of backward integration is low as the capital investment required is very high and buyers are small and fragmented. (e. .The other industries are having products that can act as substitutes but then the switching costs of buyers is high OVERALL: HIGH BARGENING POWER OF BUYERS . Ninja is a 250cc 4-stroke bike). . Hyper Motard.Cost disadvantage would be there for the new players since existing players already benefiting from economies of scale. S 1000 RR and bigger K series bikes with 4-cylinder engines). supply chain management would be high . Street Fighter. marketing costs. Monster. fuel prices .High per capita income makes buyers less price sensitive thereby decreasing the bargaining power . which are powered by 696.India Yamaha Motors Limited 9 Chapter: THREAT OF NEW ENTRANTS . with 15 different models including.The barriers to entry is very high due to presence of strong players like Yamaha. the industry should not see many new players entering the arena.

THREAT OF NEW ENTRANTS .

Hero Honda. the struggle to increase sales is being reduced to a constant-sum game where everyone is trying to outsmart the competitors by innovations and price wars. the Indian two wheeler market offers a decent potential for growth.Industry is earmarked with high profit margins Buyers‟ switching costs are low as each company has its own portfolio of products and it can cater to each and every segment OVERALL: HIGH/VERY HIGH Rationale: The industry is earmarked with large and powerful competitors like Bajaj and Hero Honda. who already have a huge market share. we can see that it‟s really very difficult for a new entrant to see the industry as economically viable to enter.The concentration of competitors is high i. This growth is relevant in the light of the fact that 70 per cent of India’s population is below the age of 35 Years and 150 million people [Refer Figure 1Annexure A]. KMC. we would say that the Industry is Attractive. the threat of substitutes as well as bargaining power of suppliers are favorable forces.e. Industry growth rate(CAGR) in past decade is almost 10% which is definitely not so much lucrative after liberalization and India’s GDP has grown up to 8% . Due to moderate industry growth rate of 10%. LML etc The relative size of competitors is large and they have enough operational excellence and financial muscle. Even though the industry is bound to see a lot of competition. The threat of new entrants. INDUSTRY RIVALRY 10 Chapter: INDUSTRY RIVALRY . Royal Enfield. Bajaj Auto. looking at the high profit margins along with some moderate growth opportunities. TVS.India Yamaha Motors Limited . The reasons for unattractiveness of industry for a new entrant are: High bargaining power of buyers Requires huge investment in R&D Difficult to set a sales and distribution model across the country But for an incumbent the equation changes and with the rising levels of per capita income of people. INDUSTRY ATTRACTIVENESS From the analysis done.Product differentiation is low as any product being matched in a few months by competitor. .

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000 kilometers of its operation. whichever occurs first. YAMAHA warrants the products to be free from manufacturing defects for a period of two (2) years from the date of sale of the Motorcycle or first 30. those parts which may be found on examination to have manufacturing defect.000 kilometers of its operation.India Yamaha Motors Limited COMPETITIOR’S ANALYSIS PRODUCTION CAPACITY (in units) 3900000 1000000 3690000 2420000 600000 IN PROFITS? No. Also. to the purchaser. whichever occurs first. Yamaha receives heavy competitive pressures especially on grounds of the cost as well as distribution leadership assumed by these players. of models in 150cc+ bikes 5 2 4 4 3 Variants HERO HONDA HONDA MOTORS BAJAJ AUTO TVS MOTORS YAMAHA Yes No Yes Yes No 150cc-225cc 150cc-250cc 180cc-220cc 150cc-220cc 150cc only Big players such as Hero Honda and Bajaj (as shown in the figure above) have exercised a huge Bargaining power over suppliers as well as buyers. Yamaha‟s annual capacity is very less as compared to other competitors. Currently Yamaha is providing bikes only in 150cc whereas their counterparts are have already launched their bikes in 150-250c bikes. As such. If during this period of warranty the Motorcycle proves to be defective due to material or workmanship. [refer Annexure – A for detailed competitor analysis] INTERNAL ENVIRONMENT ANALYSIS VALUE CHAIN ANALYSIS PRIMARY ACTIVITIES YAMAHA will replace or repair at its Authorized Dealership free of charge. YAMAHA through its Authorized Dealers will repair the Motorcycle without charging the labor or parts value as per the terms and conditions . within 2 years from the date of sale of Motorcycle or first 30.

11 Chapter: COMPETITIOR‟S ANALYSIS Customer Satisfaction has always been the top priority of Yamaha and the company is planning to enhance Yamaha Bike Station numbers to 180 from current 100. The Yamaha Best Service Stations are planned to increase to 250. It also provides engineers to dealers to provide the service to their customers. To provide good services. Service . Yamaha ensures the availability of all major parts with their dealers.

This is an aberration to the industry trend of an average of 2 month credit period. As such. software automatically sends the order to their all vendors with all the requirements. The Labour . They coordinate with their all vendors through software. it is the responsibility of the vendor to provide raw materials at the company gate. After deciding the number of bikes to be produced. and Bangladesh etc. Best Service Facility and Genuine Parts. Currently. However.Best Showroom. they have separate departments for activities like painting. an authorized Yamaha Dealership with the Best 3S facility . Rock concerts in the country. Yamaha India also serves to foreign markets such as Argentina. We have In-house facility for Machining. Welding processes as well as finishing processes of Electroplating and Painting till the assembly line. Manufacturing of engines and gears are done in Faridabad plant while production runs in Surajpur. the supply side is marked by a lot of politics between the vendors and bigger players who have a large appetite to place orders beyond capacity thus creating an artificial scarcity in the market. Human Resources Management They have more than 2000 employees including staff and managers.India Yamaha Motors Limited Marketing & Sales Outbound Logistics Operations Inbound Logistics John Abraham is the Brand Ambassador of Yamaha in India. As such. Yamaha has two plants i. They also promote their products through Road Shows.e. They have two conveyor lines where bikes can manufacture in parallel in two shifts. They have tie-ups with Transportation companies to deliver the motorbikes at dealer‟s place. They usually run their theme with the Campaign “Yes Yamaha”. Yamaha has introduced the unique concept of Yamaha Bike Station (YBS). The two wheeler industry largely sources its parts and components from common vendors in North India (Faridabad being the hub). in Faridabad and Surajpur (Noida). Yamaha does not offer any credit terms to its dealers except in discretional cases. Also. Mexico. a motorcycle comprises of over 2000 components which are locally sourced. welding etc. The infrastructure at both the plants supports production of motorcycles and its parts for the domestic as well as oversees market. Yamaha has a policy of ordering for the parts at least three months in advance. it exercises a relatively lesser influence on its distributors in terms of stocking and display. the company has increased its production capacity from 400000 bikes per year to 600000 bikes per year. All activities in the company are headed by Japanese except HR Department. Philippines. The lead time of the bikes is very high as compared to their competitors. Yamaha has a smaller range of models in comparison with its counterparts in India like Hero Honda and Bajaj.Faridabad (Haryana) and Surajpur (Uttar Pradesh). SUPPORT ACTIVITIES Firm Infrastructure Chapter: VALUE CHAIN ANALYSIS Manufacturing facilities comprises of 2 state-ofthe-art Plants at . Yamaha procures the heavy components from its vendors in Japan and Thailand. At the core are the 5-S and TPM activities that fuel our agile Manufacturing Processes. Also.

12 .Union possesses a very strong bargaining power especially post the 72 day strike in 2000 which led to institution of a binding increment in allowances at the operational-supervisory level every three years.

They have a pool of experience holders who are there in the organization over a long time. Technological Resources The unique technologies like liquid cooled engine. Both plants are located in the industrial area of their respective cities. The role of Purchase Management is to negotiate with the vendors on the terms of price and delivery. Workers are also expected to state a minimum level of productivity. YZF-R15 Yamaha first designed a cowling shape around the radiator that would make maximum use of the running airflow. As company plans the production for the next 3 months and enters into their software. Intangible Resources Human Resources Yamaha has around 2000 employees including both the plants. They have also filed a patent application for various technological solutions related to the diesel engine. Decentralization of work clear hierarchy facilitates the . It also maintains a good working capital because they provide very less credit to their dealers. they introduced a very high technology which differentiates Yamaha from its competitors in this segment. Physical Resources Company has two plants in Faridabad and Surajpur. the parent company from Japan provides the required funds to Yamaha India. Purchase Department checks the quality and quantity of raw material and transfer to stores department. Procurement The procurement system in Yamaha is totally online. the order for the raw materials automatically reaches to each and every vendor. Organizational Resources Rather than communicating the instructions downward. Faridabad plant manufacture the engine. They have introduced bike in radical tires for the first time on the Indian roads. They store the products in the lot of production which is going to follow. floor workers are encouraged to plan their work schedule on their own. YAMAHA INDIA’S RESOURCES Tangible Resources Financial Resources Yamaha Motors Corporation. and design approach differentiate Yamaha over the other competitors.per day or per week and any deviation from this standard is analyzed and corrected by the workers and the management. For instance. They have also an appropriate capacity to store their raw materials. Company also has two assembly lines which can run in parallel. Particularly for 150cc+ bikes. As Faridabad is called the hub for raw material for the automotive industry. gears and other parts while Surajpur plant is for assembling. DiAsiL cylinders. Then the schedule and resources are finalized through direct interaction of workers and management. company has very easy access to the raw materials.India Yamaha Motors Limited Technological Development Yamaha‟s technology in India is fully supported by its parent company from Japan.

13 Chapter: YAMAHA INDIA‟S RESOURCES .

They also recruit casual workers mainly for the purpose of procurement and assembling. They believed in keeping a long term relation with their suppliers. Indian customers always perceive Yamaha as a sport bike.the Brand Ambassador Out of the box promotional ideas like organizing rock concerts. they have launched their bike with Radical tires for the smooth riding. Innovation Resources The strong R&D development from Japan has a capacity to provide innovative products to serve the customer from each segment. Their idea sense is totally based on customer needs. With the image of bikes like RX100. They also have launched many models with innovative design like Enticer. To manufacture diesel engine To design innovative models To make 6 speed transmission bikes To make liquid cooled engine with DiASil cylinder Control on demand-supply gap through a software Facilitates communication with suppliers and dealers Links all the workings with parent company in Japan Technology Information Systems 14 Chapter: YAMAHA INDIA‟S RESOURCES . Reputational Resources Yamaha has the brand image for their products. YAMAHA INDIA’S CAPABILITIES FUNCTIONAL AREAS Finance Human Resources Marketing invest a large outlay for R&D To provide funds against losses To keep low retention rate Training opportunities in Japan John Abraham. For example.India Yamaha Motors Limited smooth flow of working.

Resources Resource Tangible/ Intangible Capabilities Potential access to wide variety of markets Value contributed to end product High Difficulty in imitation/substitut ion Low Competitive advantage in short run Yes Competitive advantage in long run Yes Finance Tangible To invest a large Moderate outlay for R&D Training Low opportunities in Japan Out of the box High promotional ideas like organizing rock concerts -To design innovative High models -To make 6 speed transmission bikes -To make liquid cooled engine with DiaSil cylinder Facilitates Moderate communication with suppliers and dealers Human Resources Marketing Intangible Moderate Moderate No Yes Intangible .

Low Low Yes No Technological Tangible High High Yes Yes Information Systems Tangible .

Moderate Low Yes No .

Also. SWOT ANALYSIS STRENGTHS Back-up support from the parent company Highly experienced management Good R&D set up Premium technology Established Brand Prime location near raw material providers OPPORTUNITIES Increasing urbanization leads to growing premium segment First mover advantage in sports premium bikes (500cc+) Double digit growth in two wheeler geared industry Exports opportunities WEAKNESSES Below industry standard production capacity Poor Distribution channel No marketing aggressiveness Internal HR issues Operational ineffectiveness Storage problems Lack of diversified product portfolio THREATS High competition in the market Rise in raw material products Increase in interest rates on finance Cars available in the same price range . It is also very costly to imitate because setting new R&D requires huge investment for the competitors. The YZF-R15 and FZ16 engines have a single-axis balancer. which in turn reduces vibration felt by the riders at the front and rear of the seat.YAMAHA’S CORE COMPETENCIES Yamaha India‟s R&D is considered to be the core competency for Yamaha because they produce very better engine performance. This reduces engine vibration. the handlebars and the footrest. That's why the engine is quieter and the ride has a quality feeling. because aluminium dissipates heat 3 times faster than steel. A good R&D is always a valuable for any company. good acceleration capability. All these technologies facilitate a better engine performance. Liquid cooling has the ability to keep down the temperature in a highperformance engine that would otherwise reach very high temperatures. the liquid coolant in a liquid-cooling system absorbs engine noise. That's why it is used on race machines. The above technologies which Yamaha develops are very rare. a good balance which will provide a good riding performance.

Yamaha should increase their production capacity As Yamaha India has plans to capture four different markets in India i. Currently. More models in 150cc+ segment (only bikes at 150cc bikes) As other competitors like Hero Honda. Also. Yamaha should go beyond 150cc+ bikes. Rural area with entry segment bikes and scooters. Sports Bikes. parts of the bike are not easily available in the market. Yamaha should provide credit periods to their dealers so that they give more orders.e. Youth oriented promotion Yamaha claims that they target the customers of age group 18-25 but their ad never represents this so they should make such kind of AD where youth should take in as center of attraction. Should improve the after sale services Yamaha is not satisfying their customers in after sales services. They should do this earliest to capture the market because vast majority of people depending on ads and friends as their chief sources of information about the products. Yamaha don‟t provides any credit period to its vendors. The poor roads conditions of other cities is also the one reason not to focus on 2 tier cities. The reason is that the earning capacity of youth is higher as compared to 2 tier cities. 1 Chapter: RECOMMENDATIONS .India Yamaha Motors Limited RECOMMENDATIONS Focus on metro cities Yamaha should target metro cities first for their premium bikes. They should also use their Faridabad plant to assemble the bikes after taking the license. Measures should be taken to improve its dealership Yamaha which is trying to build a brand new image of a high tech and stylish brand of bikes should take appropriate steps to show it in their showrooms. This is the major drawback in capturing the market share so Yamaha should take some better steps to satisfy and retain their customers. Yamaha have only 3 bikes in 150cc in different variants. Bajaj provides motorbikes upto 250cc. Yamaha should plan to increase the annual production capacity which is very as compared to its competitors.

com/doc/28370752/Comparison-Study-of-Honda-Hero-Honda-amp-Bajaj http://www.financialexpress.sulekha.html http://www.html http://www.business-standard.com/Member/memberhead.html http://www.com/talkies/news/16984-yamaha-unveils-new-ad-campaign-around-icc-cricketworldcup-2011-a.yamaha-motor-india.html http://www.businessworld.cms http://ezinearticles.com/india/news/bmw-bikes-in-india-by-dec-at-rs-18lakhonwards/113917/on http://www.motorbeam.in/ducati-india-plans-sell-150-high-end-bikes-year-20102245934 http://www.com/doc/32459289/TWO-WHEELER-P-P-T 2 Chapter: REFERENCES .html http://www.whereincity.com/whatsnew/win20.com/?Future-of-Electric-Bikes-in-India&id=5316144 http://www.scribd.surfindia.economictimes.com/automobile/compare-150cc-500ccbikes.yamaha-motorindia.oneindia.in/2009/10/08/bajaj-launches-sports-bike-kawasaki-ninja.com/2010-04-19/news/27604874_1_yamaha-planspankajdubey-india-yamaha-motor http://www.com/bikes/yamaha-bikes/yamaha-applies-for-turbodiesel-engine-patent/ http://www.com/review/Yamaha-FZ16-qprrtqrrqm http://www.dancewithshadows.com/whatsnew/win20.scribd.yamaha-motorindia.com/doc/28710601/Yamaha-Sales-promotion-and-Customersatisfaction http://www.php/Automobiles/Yamahas-NewSpark-Plug.html http://www.indiatimes.xbhp.in/story-newsbikes/yamahas_turnaround_strategy-561-0.com/2010/04/06/yamahaeyes-deluxe-premium-bike-segments/ http://www.com/16secrets/engine/index.com/news/news-byindustry/auto/automobiles/mahindra-kinetic-is-awin-win-deal/articleshow/3311955.html http://www.yamaha-motor-india.aspx http://www.com/service/warranty.topnews.com/yamaha-india-bolster-sales-by-232percent_12_2010_postedby_jayashankar-menon http://articles.html http://www.html http://bikes.indiatimes.html http://www.economictimes.scribd.siamindia.com/news/premium-bike-segment-pulls-it-for-thesector/275817/3 http://automotivehorizon.mouthshut.India Yamaha Motors Limited REFERENCES http://www.com/autoindia/200300-cc-bikes-premium-segment-motorcycles-in-india/ http://goaonwheels.financialexpress.yamaha-motor-india.indiatimes.com/about/profile/process.com/ http://economictimes.com/news/the-nano-effect/434592/ http://news.com/doc/2165100/Yamaha http://www.overdrive.scribd.in/index.com/201004-19/news/27604874_1_yamaha-plans-pankajdubey-india-yamaha-motor http://articles.

(HMSI) is a wholly owned subsidiary of Honda Motor Company Ltd.3 litres MAXIMUM POWER 10. Haryana.. the Honda Motorcycle & Scooter India Pvt. Hero Honda is globally known of being the most fuel-efficient and the largest CBZ selling Indian Motorcycle Company.) 70000-80000 49000-52000 72000-75000 FUEL TANK 12 litres 13 litres MAXIMUM POWER 12. HERO HONDA BIKES IN PREMIUM BIKES MODEL ENGINE CAPACITY 149. The company's most wellknown brand is the Honda Activa that revolutionized the Indian scooter market in terms of design and features.The annual capacity is 1000000 units.6KM@8500 rpm 16.India Yamaha Motors Limited ANNEXURE-A Detailed competitor Analysis YAMAHA IN PREMIUM SEGMENT MODEL ENGINE CAPACITY 150cc 153cc 153cc WEIGHT (in kg) 124 141 PRICE RANGE (In Rs.2cc 223cc 225cc WEIGHT (In Kg.1PS@ 7500 rpm 14PS@7500 rpm YAMAHA FZ1 YAMAHA SZ YAMAHA FAZER HERO HONDA MOTORS LTD. Hero Honda Motors Ltd.8bhp@7000 rpm 17. Japan and is located at Manesar. The company exports scooters to the European Union.8bhp@7000 rpm 16.2cc 149.) 141 150 150 159 PRICE RANGE (Rs. is a result of the joint venture between India's Hero Group and Japanese Honda Motors Company in the year 1983. Their main models in this segment are 3 .) 54000 79000 79000 91000 FUEL TANK 12 litres 15 litres 15 litres 15. Ltd. This joint venture has not only created the world's single largest two wheeler company but also one of the most successful joint ventures worldwide.6bhp@7000 rpm CBZ X-TREME HUNK KARIZMA KARIZMA ZFR1 Honda Motorcycles & Scooters India Private Limited Established in 1999.

Chapter: ANNEXURE-A Detailed competitor Analysis .

the late T. Srinivasan .S.8cc 220cc WEIGHT (In Kg. The company is the third largest two-wheeler manufacturer in India and ranks among the top ten globally. They have an installed capacity of around 2420000 units per annum. The company has been known for its ruggedness and reliability.3bhp@8000 rpm 5. the company has become a market leader.) 154 150 145 150 PRICE RANGE (Rs.1cc 250cc WEIGHT (In Kg. Bajaj Auto Ltd.India Yamaha Motors Limited HONDA MOTORS PREMIUM SEGMENT BIKES MODEL ENGINE CAPACITY 149. Their main models in this segment are TVS PREMIUM SEGMENT BIKES MODEL ENGINE CAPACITY 159. Established in 1945 Bajaj Auto Ltd was incorporated as a trading company.5bhp@8000rpm 15KW@8000rpm 15KW@8500rpm 15KW@8500rpm MODEL AVENGER DTSi AVENGER 220 PULSAR DTSi PULSAR DTS FI 220 AVENGER DTSi AVENGER 220 PULSAR DTSi PULSAR DTS FI 220 TVS MOTORS TVS Motor is a leading and trusted two wheeler company began with the vision of TVS Scooty the founder of the Sundaram Clayton Group. is one among India's top ten companies in terms of market capitalization and among the top five in terms of annual turnover.) 63000 85000 7000075000 80000 FUEL TANK 14 litres 15 litres 15 litres 15 litres MAXIMUM POWER 16. scooters. BAJAJ PREMIUM SEGMENT BIKES MODEL ENGINE CAPACITY 180cc 220cc 198.4 litres MAXIMUM POWER 13.) 136 137 130 140 PRICE RANGE (Rs. Today. three wheelers). These days.) 62000 95000 80000 80000 FUEL TANK 16 litres 16 litres 16 litres 15 litres MAXIMUM POWER . motorcycles.4KW@7500 rpm UNICORN VTR BAJAJ AUTO Ltd.'to design.) 51209 150000 FUEL TANK 13 litres 12.) 139 161 PRICE RANGE (Rs. Bajaj Auto Ltd. develop and produce an affordable moped for the Indian family. has started offering products in all segments (mopeds & scooterettes.7cc 220cc 150cc 160cc WEIGHT (In Kg.

1bhp@6500rpm 15.2bhp@8500rpm .4 Chapter: APACHE RTR 160 APACHE RTR 220 180 RTR MENACE VELOCITY 160 13.

India Yamaha Motors Limited Annexure B – Achievements of Premium Segment Bikes of Yamaha r 2010 (SZ-X) by ET Zigwheels. Best Executive 125cc Commuter Motorcycle of the Year 2010 (YBR-125) by ET Zigwheels. Best Styling & Success in Motorsports by Auto India. Viewer‟s Choice Bike of the Year Award (SZ-X) by ET Zigwheels. Most Sporty. FIGURE 1: Rise in India’s Young Working Population FIGUERE 3: Break-up of the Two-Wheeler Industry FIGURE 2: The Production of automobiles (2008-09) 5 Chapter: Annexure B – Achievements of Premium Segment Bikes of Yamaha . 150cc Commuter Motorcycle of the Year 2010 (SZ-X) by ET Zigwheels. Viewer‟s Choice Award (SZ-X) by CNBC Overdrive Awards 2011. Motorcycle of the Year Above 150cc (SZ-R) by Bike India Awards. Viewer‟s Choice Award (SZ-X) by NDTV CAR & BIKE AWARDS 2011.