PRODUCT CATEGORY: Passenger Cars (LMVs)

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CHAPTER 1IntroductionCompany Profile

Logo of Maruti Udyog

HistoryMaruti Udyog Limited was established in February 1981, though the actual production commenced only in 1983. It started with Maruti 800, based on theSuzuki Altokei carwhich at the time was the only modern car available in India. Its only competitors wereHindustan AmbassadorandPremier Padmini. Originally, 74% of the company was owned by theIndian government, and 26% by Suzuki of Japan.As of May 2007, the government of India sold its complete share to Indian financial institutions and no longer has any stake in Maruti Udyog.

BeginningsMaruti's history begins in 1970, when a private limited company named 'Maruti technical services private limited' (MTSPL) is launched on November 16, 1970. The stated purpose of this company was to provide technical know-how for the design, manufacture and assembly of "a wholly indigenous motor car". In June 1971, a company called 'Maruti limited' was incorporated under the Companies Act andSanjay Gandhibecame its first managing director. "Maruti Limited" goes into liquidation in 1977. On 23 June 1980 Sanjay Gandhi dies when a private test plane he was flying crashes. A year after his death, and at the behest ofIndira Gandhi, the Indian Central government salvages Maruti Limited and starts looking for an active collaborator for a new company. Maruti Udyog Ltd is incorporated in the same year.

Suzuki Enters

In 1982, a license & Joint Venture Agreement (JVA) is signed between Maruti Udyog Ltd. andSuzukiof Japan. At first, Maruti Suzuki was mainly an importer of cars. In India's closed market, Maruti received the right to import 40,000 fully built-up Suzukis in the first two years, and even after that the early goal was to use only 33% indigenous parts. This upset the local manufacturers considerably. There were also some concerns that the Indian market was too small to absorb the comparatively large production planned by Maruti Suzuki, with the government even considering adjusting the petrol tax and lowering the excise duty in order to boost sales.Finally, in 1983, theMaruti 800is released. This 796 cc hatchback is based on theSS80 Suzuki Altoand is Indias first affordable car. Initial product plan is 40% saloons, and 60% Maruti Van. Local production commences in December 1983.In 1984 theMaruti Van, with the same three-cylinder engine as the 800, is released. Installed capacity of the plant inGurgaon, reaches 40,000 units.

In 1985 theSuzuki SJ410-basedGypsy, a 970cc 4WD off-road vehicle, is launched. In 1986 the original 800 is replaced by an all-new model of the 796cc hatchback Suzuki Alto/Fronte. This is also when the 100,000th vehicle is produced by the company. In 1987 follows the company's first export to the West, when a lot of 500 cars were sent to Hungary. Maruti products had been exported to certain neighboring countries already. By 1988, the capacity of the Gurgaon plant is increased to 100,000 units per annum.COMPETITIVE SETSince major sale of Maruti is from its one product Maruti 800 we have tried to identify its competitive set. LEVEL OF COMPETITION DEFINITONCOMPETING COMPANY NEED SATISFIED

1. Product formSmall car.

(Alto 800)Hyundai, TataEase in commuting within city limits, fuel efficiency, low priced, lightweight.

2.Product category Cars. (Convertibles, Luxury, Mid-sized, Multipurpose, Sports- Utility, Station Wagons)Hyundai, Honda, Tata, Ford, Daimler-Chrysler, M&M, GM, Fiat, Skoda.Convertibles: Good power to weight ratio, superior handling.

Luxury: Status symbol, high level of comfort, luxury features, satisfies ego.

Mid-sized: Reasonably Spacious, high on comfort & Safety features.

Multipurpose: Spacious, used for heavy-duty tasks like to haul heavy luggage, used for commercial purpose.

Sports Utility Vehicle: High driving position, good for rough and tough usage.

Station Wagon: High load carrying capability, spacious, comfortable, fitted with useful accessories.

PRODUCT SPECIFICATIONS

ALTO 800

Dimensions

Length3335 mm

Width1440 mm

Height1405 mm

Wheelbase 2175 mm

Ground clearance170 mm

Min. turning radius 4.4 m

Weight

Unlade (std.)640 Kg

TransmissionManual 4/5* forward,

all synchromesh 1 reverse

Engine

Type4 stroke cycle, water cooled

SOHC 1 C2 V/iC4V*

Number of cylinders3

Swept Volume796 cc

Maximum Torque56 Nm @2500 rpm/

62Nm @3000 rpm*

Maximum Power37hp@5500 rpm/

45hp@6000 rpm*

Suspension

FrontMcPherson strut & coil spring

Rear (Std.)Leaf spring

(DX & EX)Coil spring with gas filled shock absorbers

Tyres

Std.5.65-12-4 PR

EX & DXRadials 145/70-R-12

Brakes

FrontDisc

RearDrum

Capacity

Fuel tank 30 Lts.

OMNI

Specifications

Length3370 mm

Width1410 mm

Height1640 mm/ 1835 mm*

Wheel base1840 mm

Ground clearance165 mm

Min. turning radius4.1 m

Curb Weight740 Kg/ 755 Kg*

TransmissionManual, 4 forward, all synchromesh

1 reverse

Engine

Type 4 stroke cycle water cooled

Number of cylinders3

Swept Volume796cc

Maximum power37.0 bhp@5000 rpm.

Maximum torque5.8 Kgm@2500 rpm

Suspensions

FrontMcPherson Strut

Rear Leaf spring with shock absorbers

Brakes

FrontDrum

RearDrum

Tyres4.50-12-6PR ULT

Capacity

Fuel tank36 Lts

Seating5 / 8 seater options available

CELERIO

Dimensions

Length3495 mm

Width1495 mm

Height1405 mm

Wheelbase2335 mm

Ground clearance165 mm

Min. turning radius4.9 m

Weight Unlade755 Kg/ 765 Kg#/790Kg*/ 830 Kg**

Engine

TypeAluminum, Water Cooled, SOHC/TUD5, IDI**

No. of cylinders4, in-line

No. of valves4 valves per cylinder#

Diesel / Non-MPFI2 valves per cylinder

Swept Volume993cc/ 1527 cc**

Maximum power50 bhp@6500 rpm/

57 bhp@5000 rpm**/

60 bhp@6000 rpm#

Maximum torque7.2 Kgm@4500 rpm/

9.7 Kgm@2250 rpm**/

8 Kgm@4500 rpm#

Fuel delivery DieselRotary distributor type

Compression Ratio8.8:1/94 + 0.2:1#/23:1**

Control 16- bit Computer#

Transmission

Manual type5 forward, 1 reverse

Automatic type3 speed with planetary geat*

Suspension

FrontMcPherson Strut

Rear3-link rigid axle with isolated trailing arm, coil springs and gas-filled shock absorbers.

Brakes

FrontDisc

RearDrum

TyresRadial, 145/80 RI2 (for all models, except Diesel)/ 145/ 70 R13**

Capacity35 Lts.

ALTO K10

Specifications

Length3495 mm

Width1495 mm

Height1460 mm

Wheel base2360 mm

Min. turning radius4.6 m

Curb Weight740 Kg / 750 Kg*

Gross Weight1165 Kg

Transmission

Manual type5 forward all synchromesh,

1 reverse

Engine

TypeFC, 4 valves per cylinder,

MPFI

Control16- bit Computer

Number of cylinders3/ 4*

Piston displacement796cc/1061 cc*

Maximum power45 bhp @ 6000 rpm/

62 bhp @ 6000 rpm*

Maximum torque 62 NM@3000 rpm/

82 NM @ 3500 rpm*

Suspension

Front Macpherson Strut with torsion type anti-roll bar.

RearCoil spring with double action telescopic shock absorbers.

Brakes

Front Disc

RearDrum

Tyres

Capacity

Fuel tank35 Lts

EECO

Length3675mm(144.7in)

Width1475mm(58.1 in)

Height1800mm (70.9in)

Curb Weight908Kg (2002 lb)

Engine1200CC 14 engine

Transmission5- speed manual

Fuel Petrol, Cng and Electric

Power Power :73 bhp@6000rpm

Torque: 101nm@3000rpm

4 cylinder

Rear BrakesDrum

TyresR13 Tubeless

Front BrakesDisc

Boot Space540L

WagonR Specifications

Length3495 mm

Width1495 mm

Height1660 mm

Wheel base 2360 mm

Ground clearance 165 mm

Min. turning radius4.6 m

Curb Weight825 Kg/ 840 Kg

Gross Weight1225 Kg for LX, Lxi, Vxi,

1240 Kg of Ax

Transmission

Manual type5 forward all synchromesh,

1 reverse gear

Automatic type3 speed with planetary gear*

Engine

Number of cylinders 4 in-line, FC engine/

4 valves per cylinder.

Swept volume1061 cc

Maximum power62 bhp @ 6000 rpm

Maximum torque8.4 Kg @ 3500 rpm

Suspension

FrontMcPherson Strut with torsion type roll control device

RearCoil spring and gas filled shock absorbers with three link rigid axle and isolated trailing arms

Brakes

FrontDisc

RearDrum

Tyres145/70 R13 (Radial)

Capacity

Fuel tank35 Lts

RITZ

Engine1.2L

1.3D

Transmission 5 Speed Manual

Length3720mm

Width1680mm

Height1590mm

Curb Weight908Kg (2002 lb)

Rear BrakesDrum

TyresR13 Tubeless

Front BrakesDisc

Boot Space540L

SWIFT

Engine1.2L

1.3D

Transmission5 speed manual

Length3850mm

Width1695mm

Height1510mm

Curb Weight1035-1200kg

Maximum Power80 bhp@6000 rpm

Maximum Torque103 Nm@4500 rpm

Suspension

Front and RearLeaf spring with double action damper

Brakes

FrontDisc

Rear Drum

TyresF78-15-4 PR/ 205/70R15*

Capacity

Fuel tank40 Lts.

SWIFT DZIRE

Dimensions

Length4090 mm

Width1575 mm

Height1395 mm

Wheelbase2365 mm

Ground clearance LX, VX170 mm

AX160 mm

Min. turning radius 4.8 m

Weight

Unlade weight LX, VX 875 Kg

AX900 Kg

Transmission4.8 m

Manual5 forward,

all synchromesh

1 reverse

Automatic3- speed automatic,

1 reverse

Engine

Type MPFI4 stroke cycle all aluminum water cooled SOHC

CylindersIn-line 4

Swept Volume1298 cc

Maximum power85 bhp@

6000 rpm

Maximum torque 106 Nm@

3000 rpm

Brakes

Front Ventilated disc Drum

Suspension

Front & RearMcPherson strut and coil spring

Tyres155/80 R 13

Capacity

Fuel tank40 Lts.

ERTIGA

Engine1.4L Petrol

1.3L Diesel

Transmission5speed Manual

4speed Automatic

Length4265mm

Width1685mm

Height 1695mm

Curb Weight 1180kg

Specifications

Type All Aluminum

Contemporary, 16 valve SOHC

Number of cylinders / valves 4 in-line, 16

Swept volume1590 cc

Maximum torque132 NM@3000 rpm

Fuel DistributionMPFI

Compression ratio9.0 + 0.2:1

Wheelbase2480 mm

Ground clearance 170 mm

Min. turning radius4.9 m

CIAZ

ClassSedan Car

Production2014

LayoutFront Engine

Front Wheel Drive

Engine1.4 Petrol

1.3 Diesel

Transmission5 Speed Manual

4 Speed Auto

Wheelbase2650mm

R15 Tubeless

Airbags4 Airbags

Max Power68@6000rpm

Max Torque130@400rpm

Emission StandardBS IV

ABSYES

Engine ImmobilizerYES

A\CAutomatic

PRICE SPECIFICATIONSALTO 8002.4 - 3.5 Lacs

ALTO K103.1 - 3.8 Lacs

OMNI2.2 - 2.8 Lacs

CELERIO3.8 - 4.8 Lacs

EECO3 - 4 Lacs

WAGONR3.5 - 4.4 Lacs

RITZ4.2 - 6.2 Lacs

SWIFT4.4 - 7 Lacs

SWIFT DZIRE4.9 - 7.3Lacs

SX47.2 - 9.5 Lacs

CIAZ7 - 9.8 Lacs

ERTIGA5.8 - 8.5 Lacs

GYPSY5.4 - 5.9 Lacs

PLACING OF THE PRODUCT

Sales & Service Network

As of 31 March 2014 Maruti Suzuki has 933 dealerships across 666 towns and cities in allstatesandunion territoriesof India. It has 3,013 service stations (inclusive of dealer workshops andMaruti Authorized Service Stations) in 1,436 towns and cities throughout India.It has 30 Express Service Stations on 30National Highways across 1,436 cities in India.

Service is a major revenue generator of the company. Most of the service stations are managed on franchise basis, where Maruti Suzuki trains the local staff. Other automobile companies have not been able to match this benchmark set by Maruti Suzuki. The Express Service stations help many stranded vehicles on the highways by sending across their repair man to the vehicle.Exports

Maruti Exports Limited is the subsidiary of Maruti Suzuki with its major focus on exports and it does not operate in the domestic Indian market. The first commercial consignments of 480 cars were sent toHungary. By sending a consignment of 571 cars to the same country Maruti Suzuki crossed the benchmark of 300,000 cars. Since its inception export was one of the aspects government was keen to encourage.Every political party expected Maruti Suzuki to earn foreign currency. Angola, Benin, Djibouti, Ethiopia, Europe, Kenya, Morocco, Nepal, Sri Lanka, Uganda, Chile, Guatemala, Costa Rica and El Salvador are some of the markets served by Maruti Exports.

PROMOTIONMaruti Driving SchoolAs part of its corporate social responsibility Maruti Suzuki launched the Maruti Driving School in Delhi. Later the services were extended to other cities of India as well. These schools are modelled on international standards, 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.

At the launch ceremony for the school Jagdish Khattar stated "We are very concerned about mounting deaths on Indian roads. These can be brought down if government, industry and the voluntary sector work together in an integrated manner. But we felt that Maruti should first do something in this regard and hence this initiative of Maruti Driving Schools."

Awards & Recognition

The Brand Trust Reportpublished by Trust Research Advisory, a brand analytics company, has ranked Maruti Suzuki in the thirty seventh position in 2013and eleventh position in 2014among the most trusted brands of India.

Bluebytes News, a news research agency, rated Maruti Suzuki as India's Most Reputed Car Company in their Reputation Benchmark Studyconducted for the Auto (Cars) Sector which launched in April 2012.

Mission StatementTo increase the companys performance by focusing extra on quality, productivity and cost so as to increase customer satisfaction and sales volume.

Both, the vision and the mission statement act as the guiding force for the company and act as a catalyst in the process of shaping up the company policies and approach and help to define the market where the company will operate.

Industry where MUL is operatingThe Company is operating in the automobile industry manufacturing LMVs.

Product TargetThe company will be manufacturing vehicles so as to cater to the needs of segments A1, A2, A3, B and C.

CORE COMPETENCY

The core competency of MUL lies in:

Its alliance with Suzuki Motors Corporation, which is the biggest small car manufacturer in Japan.

Pricing products competitively (MUL has an ability to keep lowering the prices which they do by working with vendors, assuring them that for every drop in price, volumes will go up).

Operational efficiency and productivity (Focus on manufacturing low cost, high quality and fuel-efficient cars).

MARKET SEGMENTATION

There were two principal systems of segmentation in the Indian passenger car industry:

1. Price Based Segmentation

2. Length Based SegmentationMUL goes by the length based segmentation.Price Based Segmentation:Classification based on price was widely accepted in the Indian passenger car industry. Maruti had, since its inception, classified its different models on the basis of ex-showroom prices of the base model in Delhi.

1. Segment A cars priced lower than Rs. 300,000

2. Segment B cars priced between Rs. 300,000 and Rs. 500,000

3. Segment C cars priced between Rs. 500,000 and Rs. 1,000,000

4. Segment D cars priced between Rs. 1,000,000 and Rs. 2,500,000

5. Segment E cars priced above Rs. 2,500,000

Length Based Segmentation:

On the basis of length the passenger vehicle market is divided broadly into the following three categories:

1. Passenger Cars (Segment A: A1, A2, A3, A4, A5, A6)

2. Utility Vehicles (Segment B) and

3. Multi Purpose Vehicles (MPVs) (Segment C)

The pie chart given below gives the relative share of each segment in Marutis passenger vehicles sales, where passenger car sales have been broken up according to the SIAM based classification (A1-A6).

Passenger Cars (Segment A)

In volume terms, passenger car sales accounted for over 77 per cent of the Indian passenger vehicles market and grew by 28.6 per cent. Maruti continues to be the market leader. During 2003-04, not only did Maruti grow due to the overall market growth, but also managed to overcome intense competition and gain market share which increased from 50.8 per cent in 2002-03 to 51.4 per cent in 2003-04. The Indian car market is classified into six categories based on the vehicle length:

A1: Mini up to 3,400 mm.

A2: Compact from 3,401 mm to 4, 000 mm.

A3: Mid-size from 4,001 mm to 4,500 mm.

A4: Executive 4,501 mm to 4,700 mm.

A5: Premium from 4,701 to 5,000 mm.

A6: Luxury 5,001 mm and above.

MUL has presence in three of these categories namely A1, A2 and A3.

A1: With Maruti 800, MUL is the only player in this category. Sales volumes increased by 16.9 percent during 2003-04.

A2: Maruti has three models in this category Zen, Alto and Wagon R. Maruti consolidated its leadership position in the A2 category. While the category grew by 23.4 per cent in 2003-04, MULs sales volume grew by 46 per cent. Consequently, the companys market share has increased from 40.3 per cent in 2002-03 to 47.7 percent in 2003-04.

A3: This is a highly fragmented category with several models, and no single player has major leadership position. MULs two models Esteem and Baleno have a combined market share of a little over 10 percent. Maruti lost some market share as its volume sales grew by around 30 percent, against the overall categorys growth of 50.8 percent.

Utility Vehicles (Segment B)

Diesel vehicles dominate this segment with a share of around 95 per cent. This is mainly because vehicles in this segment are by nature heavy and diesel has a policy determined price advantage over petrol. Since Maruti does not have a diesel vehicle today, it remains a small player in the MUV segment with a market share of only 2.5 per cent. The primary model in this segment is the Gypsy. During April 2003, the company launched its state-of-the-art sports utility vehicle (SUV) the Grand Vitara. Multi - Purpose Vehicles (Segment C)

In this segment, Marutis models include the Omni and the Eeco. Here, Maruti is the dominant player with nearly 100% market share. In 2003-04, the companys sales volumes grew by 14.7 per cent. During the latter half of the year, Maruti launched an economy model of the Versa. A new Omni variant, which runs on LPG was launched to tap newer cargo markets.

Passenger cars and MPVs are generally analyzed as a comprehensive segment. Maruti marginally increased its share in this segment with about 55.2 per cent in volume terms during 2003-04.

Chapter 2MethodologyRESEARH DESIGNResearch ApproachWhen conducting research there are different ways to address the topic. I will present and give the reason for the way we chosen to approach our study. My study is deductive since our frame of reference is based on existing theories. I based my empirical data studies on theories and used them to form a base on how to analyze the collected data. In this study I chose the qualitative approach in order to be able to deal with research problem and research questions stated for the thesis, the qualitative approach is suitable since I want to obtain a deeper understanding on how factors induce companies to use celebrity endorsers in their marketing communication, and how the risks involved can be described and measures to decrease them. A quantitative approach is not suitable because I dont want to analyze the data in numbers. Therefore a qualitative study is the best approach for me when describing the collected data in words. OBJECTIVES OF THE STUDY To study and analyze the marketing Strategies of MARUTI SUZUKI. To find the area to be improved.

SWOT Analysis To study the strategy behind Maruti Suzuki and consumers outlook towards that strategy.

MethodologyThe word research is derived from the Latin word meaning to know. It is a systematic and a replicable process, which identifies and defines problems, within specified boundaries.

It employs well-designed method to collect the data and analyses the results.

DATA COLLECTIONData is the significant part of the research. Your all research depends upon your data. Whatever data is collected by me on MARKETTING STRATEGIES OF MARUTI SUZUKI is secondary data.Secondary Data Secondary data is the data that have been already collected by and readily available from other sources. Such data are cheaper and more quickly obtainable than the primary data and also may be available when primary data can not be obtained at all.Advantages of Secondary data: It is economical. It saves efforts and expenses.

It is time saving.

It helps to improve the understanding of the problem.

It provides a basis for comparison for the data that is collected by the researcher.

Disadvantages of Secondary data: Accuracy of secondary data is not known.

Data may be outdated.Chapter 3

Findings & Analysis

SWOT ANALYSISStrengths:

Well Established Co. since 1983.

Joint venture of Suzuki Motor Corporation, Japan.

Trusted brand in India.

Only producer of the A1 segment car in India currently.

Strong distribution network all over India.

It has the maximum number of service stations all over the country, with services available in the remote areas too.

Easy availability of spare parts at low cost.

Cars known for there efficiency, efficiency in term of maintenance cost and running cost.

Tie up with SBI to provide financial services in the rural areas too.

Other services like True Value, Maruti Insurance and Maruti Finance which help to provide the turn key services to the customers.

Large share in total car exports to Europe.

Weakness: The numbers of models offered in A3 and C segment are less.

The models offered by the company are very old and looks outdated in comparison to the new cars available in the segment.

The company has low brand recognition in A3 and C segment.

Not perceived as a luxury car manufacturer but as a small car manufacturer.

Opportunity: Opportunity exists in the A3 segment, which has recorded a double digit growth of 15% in Indian market.

The company can sign in contracts with MNCs for providing them with the cars for purpose of pick and drop. This way the sales of EECO can be improved.

The company can come out with a CNG fitted kit model for cars for taxi purpose.

Coming out with diesel variants of the different Brands.

Threats: The Rs. 1.5 lakh car to be launched by Tata and TVS India.

Launch of new cars like Grand i10, in the upper A2 segment.

Price reduction and heavy discounts by other car manufacturer like Hyundai, Ford in the A3 segment.

Introduction of new models of international players in the C segment. E.g. INNOVA.

Launch of base model Santro for 2.8 lacs, closer to Marutis Altos price and a threat for Marutis A1 segment.PEST ANALYSIS

A scan of the external macro-environment in which the firm operates can be expressed in terms of the following factors:

Political

Economic

Social

Technological

Political FactorsThe automobile sector, previously under a strict licensing regime, has been a direct beneficiary of competition and technology in the new liberal regime. Not only has automobile output grown at double-digit compound rates, but the sector has become a sizeable exporter. Major international auto-companies now have operations in India, and are increasingly using the country as a platform for export-oriented production. There is also a strong set of upstream firms, producing ancillaries for, and providing design consultancy to the automobile industry. The intense price competition between the passenger cars manufacturers has yielded price benefits to the consumers.

The key issues in the automobile sector due to various political actions are:

Increases in input costs since FY2004 continues to affect the margins of players.

Higher costs to meet new emission norms.

8% special excise duty on the multi-utility vehicles and motorcars.

The industry suffers from multiplicity of taxes, which affect its competitiveness. Delays in regulatory clearances affect the investment climate and result in cost overruns. Higher costs on logistics, power and fuel and inflexible labor laws too affect competitiveness.

Need to achieve a balance between volumes (to break even / improve profits) and wide product portfolio in a highly competitive market.

Irrespective of these key issues, the automobile sector is welcomes the governments announcement to provide 150% deduction of expenditure on in house R&D in the automobile sector. It believes that this would give a further boost to the automobile sector and help it to grow faster.

Automobile sector, besides the issues mentioned above want the government to take care of the following aspects too:

Incentivize ownership of new vehicles and launch retirement scheme for older vehicles to benefit from new emission standards. Cut customs duty on parts of electrical vehicles to 5%.

Increase depreciation allowance on cars to 33.33%. Cut excise duty on car ACs to 16% on par with other auto components.Auto Policy of the Government of India:

Vision- To establish a globally competitive automotive industry in India and to double its contribution to the economy by 2010.

Policy objectives- This policy aims to promote integrated, phased, enduring and self-sustained growth of the Indian automotive industry. The objectives are to:- Exalt the sector as a lever of industrial growth and employment and to achieve a high degree of value addition in the country.

Promote a globally competitive automotive industry and emerge as a global source for auto components.

Establish an international hub for manufacturing small, affordable passenger cars and a key center for manufacturing Tractors and Two-wheelers in the world.

Steer India's software industry into automotive technology.

Assist development of vehicles propelled by alternate energy sources.

Development of domestic safety and environmental standards at par with international standards.Economic FactorsThe sharp 8.2 per cent growth in GDP in 2003-04, and the expectation that the economy will remain strong in the medium term, is a positive factor for the automobile sector. Other macro economic factors like the softening of interest rates in the past three years and the trend towards reduction in Customs and Excise Duties will also contribute to increasing demand for automobiles. The increasing availability of retail finances in smaller markets another positive development.

The impact of these factors on the passenger vehicles market was evident in 2003-04. Volume sales of passenger vehicles (including Multi Utility Vehicles) grew 27% to over 900,000 units in the domestic market. Together with exports, passenger vehicle sales scaled the million marks for the first time. Within this, domestic passenger car sales grew 28.6 % to nearly 700,000 units in 2003-04. If the positive macro factors sustain over the medium term, it is reasonable to assume that the Indian passenger vehicles industry is on the threshold of a strong growth path.

The auto industry is likely to benefit from the implementation of value added tax (VAT) in the states from 1 April 2005, which might lead to a rationalizing of taxes leading to an actual lowering of prices of automobiles. Most importantly the new income tax brackets, the change in Sales incentive, introduction of new models/variants coupled with easy availability of low-cost finance has stimulated demand for vehicles. Further, the "progressive liberalization of the norms for foreign investment and import of technology have benefited the automobile sector" with production likely to exceed 10 million in the next couple of years.

Social FactorsSocio-cultural factors also act as a strong influencing force in the automobile sectors and its strategies. Following are some of the key influencers:

India being a secular country has all the religions in existence with Hinduism being the most dominant religion. Thus sales of the vehicles vary all year round depending upon the festivals and events of different cultures and religions. For example: Hindus prefer to buy new vehicles during the Diwali time or Navratras.

Indians attitude towards foreign products and services is that of high reverence and respect. This statement lends us an explanation of high Hyundai or Honda sales whereas the company like MUL has to strive hard and be very active so as to keep up with the buyers needs, attitudes and the competitors.

Even though India is a secular country with various cultures/religions and their respective languages/dialects, Hindi (mother tongue) and English are still widely known and spoken languages (unless its the remote areas). Thus language doesnt really have an impact upon the diffusion of the product onto markets. But, still some companies make an exception by marketing and advertising their products in compliance with respective regions culture and language.

Initially there was a big gender and age bias in the Indian families with the elder male members making the main decisions but now the scenario has changed, i.e. children and females of the family take active part in the decision-making processes.

Technological FactorsIts vital for the automobile industry and its associated automotive component industry to involve themselves in continuous R & D. this is mainly to constantly upgrade them, to come up with competitive models and keep themselves abreast with the global changes and competitors.

Some of the political factors such as EURO norms and CNG norms have also forced the automobile companies to get involved in constant R & D.

Technological up gradation is also a necessity so as to be in the market and have an edge over the other automobile manufacturers.

In the age of information technology companies are making a use of it to be in constant touch with their vendors, dealers, customers etc. Internet has become a major source of troubleshooting and advertising. MUL is trying to implement e-commerce so as to be the first company to sell its cars though the Internet.

STRATEGY FORMULATIONA1 SegmentTo phase out the Maruti 800 with the Alto as the alternative:

But the problem is the price differential between the air-conditioned 800 and the Alto LX.

AC 800 comes for Rs 2.26 lakh, while the Alto LX costs Rs 2.65 lakh (after the price reductions in the recent past). So there is still a Rs 40,000 difference.

A team of engineers of Maruti Udyog (MUL) should be formed; the team would have to meet a few of the company's 268 vendors. The teams job would be to bring down the price of the 800 cc Alto LX model by Rs 40,000 to the price of the Maruti 800.

Push 800 in smaller centers and rural areas:Maruti 800 is showing a decline after being largest selling car for several years. The firm is not in a position to bring down its cost, so they are looking for other means to it more affordable. Hence they are also trying to push the cars in smaller centers and rural markets.

A2 SegmentIntroduction of new features in all the models of Segment A2 at no extra price like completely redesigned headlamps, tail lamps and a new flowing chrome grille with provision for front fog lamps.

Offering special up gradation package for the Lxi. Variants of the different Brands in this segment.

These packages would be worth Rs.14000 which would include Body colored bumpers, Wooden finish interiors, Alloy wheel caps, Body colored Door vision set.

For enhancing sales in the A2-segment, every time any of his 3.2 million owners of 800 or the Omni decide to trade in their car, and upgrade. His dealers will give them loyalty discounts to get them to upgrade to a Maruti A2 segment car.

With support from parent company, Suzuki Motors, Maruti Udyog Ltd (MUL) may work on developing a new compact car in the A2 segment for both the domestic and the export market.

A3 SegmentAfter having lost market share to Tata Motor's Indica and Hyundai's Santro in the compact segment, Maruti can decide to protect its share of the profitable mid-size segment.Esteem to be priced lower:The base model of Esteem Diesel (without power steering) comes for Rs 4.83 lakh (all prices are ex-showroom Delhi) against Rs 5.22 lakh earlier, while the loaded version will come for Rs 5.09 lakh, down from Rs 5.48 lakh. At its prevailing price the Esteem diesel is just a little more expensive than the Tata Indigo diesel (Rs 5.02 lakh) Hence the price reduction of loaded version can be reduced to Rs. 5 lakhs to be less than competitors price.

Baleno to be further discontinued:Baleno Vxi to be offered at a comparable price than the other Segment A3 cars like Hyundai Accent GVS, Ikon Zxi (Rs 6.06 lakh). Baleno Vxi presently priced at Rs 6.29 Lakh should be discounted to price of Rs. 6 lakhs this can be done at the cost of power windows, power mirrors, rear defoggers. For the second hand car marketMaruti has created a system where dealers pick up used cars, recondition them, give them a fresh warranty, and sell them again.

This way MUL will create a number of new revenue streams without making large investments. Dealers make all investments for True Value. MUL should aim at convincing 183 authorized dealers, selling Maruti cars through 241 outlets, to open at least one True Value outlet each within two years.

Taxis & Government VehiclesMaruti should plan to displace the good old Ambassador from the taxis and government vehicles segment. This is one area where sales can increase tremendously. MUL has CNG-powered, environmentally fit vehicles, which are best, suited as taxis and government cars.

MUL can offer discounts in the form of rebate to taxi owners to buy Maruti cars. If this strategy is able to convert old cars into new green Maruti, MULs sales will leapfrog by at least 10 per cent."

Taxi customers can get rebate of 8% on the assessable value of the vehicle. In absolute value, this ranges from approximately Rs. 10,000 on Omni to Rs. 28,000 on Baleno. This rebate would be available on all the vehicles having seating capacity up to seven including the driver.

Vehicles for Corporate

Offering CNG fitted Versa as a vehicle to be used for Pick up & drop service for their employees.

A 5% discount (Rs 22,000 on Versa Dx2) would be offered to these corporates on a bulk purchase of more than ten Versa.

This would help increase the sales of Maruti Versa by 15% (3500 units)

Rural Market

To counter that apprehension discussed in the market situation, the company should work on a novel idea.

For EMI: Maruti has tied up with State Bank of India (SBI). Today, organized finance is available in just 50-60 towns in India, but MUL has dealerships in 180 cities. The SBI deal gives MUL access to about 9,000 SBI branches and another 5,000 branches of its affiliate banks A typical two-wheeler loan lasts 2-3 years, charges a high rate of interest, and has a monthly payment of around Rs 2,000. Now, SBI and its affiliate banks are offering 5-7 year loans for the 800. They will charge a far lower rate of interest - around 9.5% - and the monthly installment will be just Rs 2,800.

Fuel How much you spend on fuel is in your hands.

Maintenance: As far as the maintenance cost is concerned, company will charge a little extra in the EMI and offer free maintenance.

Extra Benefit: With the State Bank of India, MUL can come out with a scheme where installments can be paid every six months - after the rabi and kharif harvests.

This makes the total cost per month to keep a car to be around 3500 as compared to the notional 7000 earlier which makes it a good option.

Vendor Rationalization: The cost reduction strategy of the company has also been successful partly because of a cost reduction with vendors. Maruti will work closely with current vendors to cut down costs at the vendor end. The company seeks to reduce costs by 10% per vehicle in the period.

MARKET STRATEGY IMPLEMENTATION

Product development with vendors: In case of product development part a team of engineers would be talking to its major vendors (25 in number) for reducing the cost of equipments supplied by them. These 25 vendors are the major suppliers of maruti components such as Jai Bharat Maruti, Krishna Maruti, and Sona Koyo Steering etc.

Advertising: The advertising may involve the process of advertisements on Television, Radio, newspaper, Auto Magazines and events like Auto Expo. T.V. Advertising- T.V. advertising may involve the advertisement at the peak hours of television viewing or during the cricket match time in the slog overs which in turn may lead to maximum exposure and thus maximum impact on the final buyers.

Advertising in Newspapers (Once in a week)- The concept of advertising on newspaper may increase the sale since the newspaper would be able to explain the characteristics and features of car. Because it is an easy way of reaching the decision makers and thus in turn may directly influence their decision.

Advertising on Radio- With FM catching more and more popularity amongst people especially people loves to listen to FM while driving. Thus this could be another mean of influencing the prospects for services like True Value at the time of 1 hour in the morning and one hour in the evening when the people are actually travelling towards their offices or coming back.

Auto Magazines (monthly) and Auto Expo (yearly): the company would advertise on auto magazine Like Autocar and overdrive where entire information on products and newer features would be explained. The cover page or Back page advertisements would be used for product communication

Celebrity Endorsements: This entirely depends on the companys policy whether they would like to spend a fixed amount (which may very depending upon the personality). The celebrity would be the brand ambassador for the company.

Technical Assistance: developing a new compact car model would involve a technical assistance from Suzuki Motor Corporation, Japan with which it has a joint venture and is its parent company. The company could help in design specification and thus may involve technology imports.

Incentives/Penalty on meeting/not meeting a sales target: The company would work with dealers with the policy of carrot and stick which may involve incentives like a foreign tour package, gifts and monetary incentives such as increased margin for meeting a sales target or working with dealers on contractual basis rather than a permanent basis if they are not able to reach sales over a period of time. A special certification would be given to the dealers for their quality in service and the company provides these dealers the additional benefits.

True Value: Observing a threat from second hand car market the company would increase its Second hand car selling base i.e. TRUE VALUE. This would involve a team of officials to convincing its 183 authorized dealers, selling Maruti cars through 241outlets, to open at least one True Value outlet each within two years.

Taxis and Government Vehicles: The process of selling vehicle to Govt. organization would involve a lower margin but a bulk sale. Also it may be quite possible that the car may be purchased directly from the company without any dealers margin in a way increasing the companys overall profit.

For taxis a rebate of 8% would be compensated by other car sales since company will have to weigh the burden in this case.

Financing through various banks: currently Maruti has its tie up with SBI for financing and the process is limited to getting the car financed through 9000 branches which the firm would go out to increase along with the financing tie ups with other banks in a way increasing the reach and more and more customers.

For rural market a finance scheme for farmers would provide for installments to coincide with the times when his crop is sold in the market i.e. CROP CYCLE (paid every six months after the Rabi and Kharif (harvests).

Inventory management (JUST IN TIME): The company would bring out a change in inventory management in the sense that JUST IN TIME has been very successful for firms like HERO HONDA. On a similar front for the SUV like VITARA this concept is very useful because they are importing it all the way from japan. Hence maintaining the minimum level is a matter of concern. Assemble line modification: Since in A1 and A2 segments there is need of change in the design and specification this would involve change in assembly line.

Vehicle for corporate: Their N2N fleet management system would be used for this purpose in which their main purpose would be to finance the vehicles for corporates.

Another way could be like leasing a vehicle to corporate sector for a period of time using their N2N fleet management system and after the fleet audit (residual value) is done this would be sold through TRUE VALUE.

Chapter 4

ConclusionsConclusionsIn current market scenario, the competition in AUTOMOBILE sector is the highest, so to remain in the competition all automobile companies have to develop in terms of technology, look, and other features. MUL as a Indian company is the market leader in INDIA, but as the globalization is coming up and the govt. is encouraging the FDI, it is getting tougher for MUL to maintain its market share. As many MNC are coming to INDIA with improved technology & features, MUL has to improve its existing technology & have to add new features to rope down the existing as well as the new customers. MUL has to add new products to its product mix. MUL has to go for more promotion to catch up the MNCs.

With the changing economic environment the auto industry is heading for a complete renaissance. The margins of the company are under the lens, so the companies are doing what ever it can to improve its bottom line.

The company we have picked up is also going through same because of this the company is continuously shuffling and re-shuffling its operation to co-up with the changes. The level of has witnessed a complete revamp in its job because of these changes. The job they were heading now demand more in terms of:

Market focused approach

Problem solving ability

Taking initiative

These are few of the changes in the role at this level which was introduced because of change in operation. And now in order to stay in the dog eat dog race the following the competencies have to be fill developed:

Integrated marketing principles

New computer skills

Keen to learn new concept etc.

Thus the changes will economic involvement will make newer and newer concept emerge on the scene at the same time rendering the old concepts obsolete. Thus we conclude that we the company has to see the sin of tomorrow it has to adapt quickly and develop new arms for its soldiers in term of competition.

Chapter 5

Recommendations

RecommendationsIn order to provide all the shots in the armory of their employees the company should implement these policies at level:

The company should arrange for inter corporate programs so that the best practices or concepts would be interchanged.

The company should provide their employee to go in for management programs from top management schools in gain new ways of doing thing.

The firms will have to set up small experimental shops where an organization can house its best talent to pursue experiment innovate develop cutting edge products, dream up new and better ways of running a business in order to develop positive value addition to the organization.

The company should arrange for games etc in order to create a forum of informal interaction between customer and employees. These meeting will help employees develop new skills or get an idea for a new product etc.

Chapter 6Limitations of the Study

Limitations

Due to time and money constraint, study wasrestricted to web only.

Data collection method was secondary and web based only.

Company dontwant todisclose their core strategies.

Secondary data is not sufficient to find outthe overall plan and marketing strategies of any of the company.BIBLIOGRAPHYBOOKS Kottler, Philip, Marketing Management, Eleventh Edition, Beri, G.C, Marketing research, Fourth Edition, Tata McGraw Hill Education Private Limited.WEBSITES

https://www.marutisuzuki.com

https://www.carindia.com http://www.carwaale.com/marutisuzukiMAGZIINESBusiness world

Maruti Suzuki company bookletAutocar

Auto driveAutocar

Auto driveMAHARAJA AGRASEN INSTITUTE OF MANAGEMENT STUDIES

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