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Internship Project

Atlas Honda Limited


Presented by:

Muhammad Haider
Internee-June-July 2015
Spare Parts Division
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Contents........................................

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Personal Statement
Introduction to Project
Industrial Review
Market Review
Consumer Behavior
Detailed Overview of Selected Companies
Comparative Analysis
Suggestions
Question & Answer Session.

Personal Statement.......................
Student of BS(BA) Hons.
At COMSATS Institute Of Information and Technology,
Lahore Campus
Last year, 7th semester
Intermediate from Government College University, LHR
Internee at SPD

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Introduction to Project
To explore the two wheeler automotive industry
in Pakistan.
To explore the spare parts markets in Lahore.
To study the market behaviour and market
structure.
To study the major market shareholders
To analyze the business competitors
To Identify gaps and suggest improvements

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Two Wheeler Industry in Pakistan


Pakistan motorcycle industry is flourishing as it met 95%
localization through state of the art technology
implementation, billions of investment and hundred
thousands of skilled work forces.
Pakistan, motorcycles sales stood at 1.44 million units
in first 10 months of FY14 according to Pakistan Bureau
of Statistics (PBS) data.
Presently there are 43+ motorcycle assemblers in the
country.
3 Japanese assemblers (Honda, Yamaha and Suzuki)
40+ assemble Chinese motorcycles.
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Two Wheeler Industry in Pakistan


The motorcycle industry in Pakistan has recorded strong
growth over the past decade, mainly due to increased
urbanization and induction of many new players in the
market who are manufacturing and providing motorbikes
at much cheaper prices, but nobody has been able to
beat the market leader, Atlas Honda.

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Two Wheeler Spare Parts Industry in


Pakistan
Leading Industry like its mother industry of Motorcycles.
There are three types of business present in the
industry, all having its own perks and privileges.
Manufacturing and selling in Pakistan
Importing and selling in Pakistan
Importing and Manufacturing and selling in Pakistan

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Market Review
Closely located market
Major transaction in Lahore and Karachi.
Main Competitors

Atlas HONDA
CRLF
ISH
Road prince

Market Studied; Lahore


Macleod Road (Main Focus)
Lytton Road
Multan Road

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Market Presence

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Brand

Number of
Outlets

Market presence
Approximated

Mix(others)

65

37%

Atlas Honda

42

24%

CRLF

23

13%

Road Prince

15

9%

ISH

3%

Yamaha

3%

Eagle Eye

2.50%

United

2.50%

Ravi

2%

Kclf

1.50%

Suzuki

1.50%

Quingqi

0.50%

RBX

0.50%

Sohrab

0.50%

Star Lf

0.50%

174

100%

Totals
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Consumer Behaviour
Consumer Demographics
Trait
Gender

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Detail
Mostly males

Age
Geographic factor

16years - 60years old


The market for spare parts is spread in all over the
Pakistan with consumption increasing as you move
towards more populated areas of Pakistan like Punjab
and sindh.

Socio Economic
factor

Mostly customer want low priced products but moderate


price parts can also be seen in market .

Psychological
Factor

The mindset of the customer is more price oriented then


quality conscious, however there is a certain set of
people which are quality conscious as well.

Detailed Overview of Selected brands

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Crown Lifan (CRLF)


Lifan Group China made an agreement with Crowngroup Pakistan in 2003.
Now the parts of Crown Lifan are available in each and
every corner of Pakistan
Claimed Quality; just like Japanese parts
Cheap Pricing
Market Share: 35%
Distribution Channel: CRLF Family and on credit of 717-21 days
Counterfeit: very low, and strong legal team.
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Crown Lifan (CRLF)


USP: CRLF Family
Marketing & Promotional Activities; Incentives,
shades, mechanics uniform, festivals celebrations,
coolers, gifts, cakes on birthdays, foreign trips, dealer
incentives, etc. In last year CRLF sponsored a group of
250 people to CHINA on a one week vacation and that
trip is still very highly discussed and admired among the
retailers and distributors in the market. According to the
CRLFs representative; OTHERS ARE DICTATORS, WE
ARE EDUCATORS.

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Crown Lifan (CRLF)

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Strengths: CRLF Family


Weaknesses: Variety short any time
Opportunities: Local Production
Threat:
Govt. Policies

Ishiwachi (ISH)
ISH is a parts importing company with their products
coming from Malaysia, Taiwan, Vietnam and China. It
was established in 2004
Slogan of Quality
High Prices
ISH listed Atlas HONDA as the competitors in the market
as they claim that both the companies are working on
quality.
USP: No Compromise on quality

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Ishiwachi (ISH)
Marketing & Promotion: ISH is also doing detailed
marketing activities, they are working on mechanics, and
they have these empty boxes schemes which are very
popular in the market.
Market Share: ISH enjoys 7-8% market share but is
increasing day by day.
Counterfeit: ISH is currently having no counterfeit in
market, however there are risks in future.
Distribution Channel:
Super Distributor Distributors Retailers
ISH deals on 70 % cash and 30 % credit business.
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Ishiwachi (ISH)
SWOT Analysis

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Strengths:
Quality
Weaknesses:
Distribution and dealer Network
Opportunities:
Regions Expansion
Threat:
Local and low priced Industry

Road Prince
Omega Industries came into existence in 1995. Today, It
is one of the top motorcycles & rickshaws manufacturer
in Pakistan.
Road Prince listed Crown Lifan as their competitors as
they follow them in their marketing and pricing
strategies.
USP: Mechanics Contacts and Reward system
Market Share: Road prince enjoys 9%-10% of market
share.
Counterfeit: Road Prince have 12-13% counterfeit in
market, they have a legal team working on it.
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Road Prince
Marketing and promotions: Road Prince is investing
heavily in marketing and promotional activities, they
have Cash prizes, gold coin schemes, UMRAH tickets
and foreign tours for mechanics and dealers.
Distribution Network:
Mega Distributor -> Distributor -> Sub Distributor -> Retailer

They give their mega distributor a credit of 60 days.

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Road Prince
SWOT Analysis;
Strengths: Financial Strength/Credit limit
Weaknesses: Stagnant marketing styles &
strategies
Opportunities: Place to become market leader
Threat:
Local Industry

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Atlas Honda
Atlas Honda Limited (AHL) is a joint venture between
the Atlas Group and Honda Motor Co. Ltd., Japan.
Atlas Honda Limited offers state of the art OEM
standard Parts with precision technology for
replacement market of all Honda Models produced
indigenously. These spare parts are perfectly
coordinated with one another and give safety, reliability
and performance of optimum level.
USP: Dealership and Service Network and high quality
genuine parts.

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Atlas Honda
Marketing & Promotions: Atlas Honda Limited is busy
doing direct and indirect marketing and push and pull
promotional schemes, they have discounts for dealers
and mechanics, however a lack of incentives and gifts
as compared to other companies.
Market Share: Atlas Honda enjoys the market share of
24-25% in terms of sales in market.
Distribution Channel: Atlas Honda Distribute its
products centrally from Karachi office and through their
dealership network mainly and also involving retailers as
well.
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Atlas Honda
SWOT Analysis
Strengths:
Quality and genuine products
Weaknesses:
stagnant marketing strategies
Opportunities:
3 wheeler and car parts market
Threat:
Counterfeit and local industry
Counterfeit: There is approximately 30-35% counterfeit
of Atlas Honda in market, according toofficials at atlas
Honda they have a legal team to defend the copy rights
and trademarks they have, but the problem seems to
prevails.
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Price Comparison
Retail Price Analysis

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Price Comparison
Whole Sale Margin Analysis

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Price Comparison
Average Margin Given To Retailer
HONDA
30.4
ISH
24.6
ROAD PRINCE
28.2
CRLF
15.3

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Counterfeit
One problem that the automobile parts companies face
in the market is counterfeit; these are non original
illegitimate and non genuine parts. After visiting the
market following statistics were found:

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Brand
Atlas Honda
CRLF
Eagle Eye
ISH
Kclf
Quingqi
Ravi
RBX
Road Prince
Sohrab
Suzuki
United
Yamaha
Star Lf
Mix(others)
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Number of
Outlets
35%
3-4%
1%
1%
Nil
5%
2%
Nil
12-13%
Nil
7-8%
1%
3%
Nil
20-30%

Major Difference of Atlas Honda and


Others
To list down the major differences between atlas Honda
and other companies, lets just see what SPD(Spare
parts Division) is to Atlas Honda Limited.

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Major Difference of Atlas Honda and


Others
Strategic goals of AHL 2015: To be the industry leader
in indigenization of motorcycle parts.
In 2015: The Spare Parts business registered an
impressive growth of 28.8%
Import of Parts: Due to imports of raw materials, plant
and machinery, motorcycle parts and other related
items, Company is sensitive to fluctuation in foreign
currency.
Financial Year Ended: Spare parts contribute almost
9% of the companys sales revenue.
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Major Difference of Atlas Honda and


Others
Things that are unique in AHL;
Atlas Honda has a well reputed name and a great
goodwill among the consumers in market.
Honda gives highest margin to its dealers to enjoy.
Atlas Honda has largest market presence of 24%.
Atlas Honda has the slogan of proved quality and 100%
genuine products.
Atlas Honda has a very strong distribution and retailer
network.

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Major Difference of Atlas Honda and


Others
But, there are some short comings
Atlas Honda's spare parts are the highest priced parts in
the market. This may deprive company of the sale from
the customers seeking low priced products.
Atlas Honda have largest amount of counterfeit products
present in the market, mainly because of the following
reasons I identified
The brand name of Honda is sold a lot in market
The price of Honda is high in market so counterfeit will result in
more profits
Legal actions of Honda have been very soft in the recent past.
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Major Difference of Atlas Honda and


Others
Although u can see HONDA having highest or second
highest sales in market, but the presence of counterfeit
brings down the original sales of AHL.
Atlas Honda has week and stagnant marketing
practices.
Atlas Honda has a NO credit policy in contrast to the
market trend.

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Suggestions
Atlas Honda is an excellent company with a legacy of more than 50 years.
However there are some things where I think the company should work more and
by doing that the company can achieve more.
Do

Dont

Marketing policies can be improvised Let counterfeit product enter the market,
by getting more mechanic focused
take necessary actions like legal
and by introducing more attractive
proceedings, consumer education and
schemes for them.
security steakers etc.
Atlas Honda have a large share in
spare parts market but that is due to
large number of motorcycles the
brand cater in the market, however
this is not the case with the other
leading companies, by focusing more
on non AHL bikes and their parts,
HONDA can acquire more market
share.

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Thank You AHL


Atlas Honda is a great corporate Giant, being part of it
was a wonderful experience.
I learned a lot in the professional environment of AHL
under the supervision of experienced employees.
Efforts of Sir Wajahat & Sir Asif are worth mentioning.
I explore practical aspects of the theoretical knowledge
gained in university.
I wish to work with AHL again in future,
Thank You!!

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END..!!!

Questions???
Comments!!!
Concerns;;;

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