52567431 a-project-report-on-automobile-industry

MANAGEMENT THESIS

ON

AUTOMOBILE INDUSTRY IN INDIA

(SPECIAL FOCUS ON BAJAJ PULSAR BIKES)

By: Nikhil jha

Index

1. ACKNOWLEDGMENT……………………………………………

2. INTRODUCTION…………………………………………………..

3. COMPANY PROFILE (BAJAJ AUTO LTD)……………………..

4.COMPETITORS……………………………………………………

5. S.W.O.T ANALYSIS………………………………………………..

6. OBJECTIVE OF STUDY………………………………………….

7. IMPORTANCE OF STUDY……………………………………….

8. METHODOLOGY………………………………………………….

9. MARKET SHARE AND GROWTH RATES……………………..

10. MARKET STRUCTURE…………………………………………...

11. PRIMARY DATA ANALYSIS……………………………………..

12. CONCLUSION…………………………………………………….

11. REFERENCES………………………………………………

Acknowledgement

I am extremely grateful to Mr. Mukesh srivastava for providing me the honor of carrying

out the project, which is helped me to put my learning’s into experience. Without his

guidance I will not be able to proceed with my project in the right direction.

I would like to express my sincere regards to the staff of marketing, whose help and

guidance enables me to know what exactly consumer’s preference towards automobile

industry is all about.

I would also like to thank my family friends and relatives who have helped me

and supported me in all possible ways.

A Project report needs co-operation, guidance and experience of many more other than

the persons whose name appears on the cover, I would like to thank each and everyone

will help me in our endeavor.

Introduction

The Indian automotive industry consists of five segments: commercial vehicles; multi-

utility vehicles & passenger cars; two-wheelers; three-wheelers; and tractors. With

5,822,963 units sold in the domestic market and 453,591 units exported during the first

nine months of FY2005

(9MFY2005), the industry (excluding tractors) marked a growth of 17% over the

corresponding previous. The two-wheeler sales have witnessed a spectacular growth

trend since the mid nineties. Two-wheelers: Market Size & Growth In terms of volume,

4,613,436 units of two-wheelers were sold in the country in 9MFY2005 with 256,765

units exported. The total two-

wheeler sales of the Indian industry accounted for around 77.5% of the total vehicles

sold in the period mentioned

After facing its worst recession during the early 1990s, the industry bounced back with a

25% increase in volume sales in FY1995.However, the momentum could not be

sustained and sales growth dipped to 20% in FY1996 and further down to 12% in

FY1997. The economic slowdown in FY1998 took a heavy toll of two-wheeler sales, with

the year-on-year sales (volume) growth rate declining to 3% that year. However, sales

picked up thereafter mainly on the strength of an

increase in the disposable income of middle-income salaried people (following the

implementation of the Fifth Pay Commission's recommendations), higher access to

relatively inexpensive financing, and increasing availability of fuel efficient two-wheeler

models.

Nevertheless, this phenomenon proved short-lived and the two-wheeler sales declined

marginally in FY2001. This was followed by a revival in sales growth for the industry in

FY2002. Although, the overall two- wheeler sales increased in FY2002, the scooter and

moped segments

faced de-growth. FY2003 also witnessed a healthy growth in overall two-wheeler sales

led by higher growth in motorcycles even as the sales of scooters and mopeds

continued to decline. Healthy growth in two- wheeler sales during FY2004 was led by

growth in motorcycles even as

the scooters segment posted healthy growth while the mopeds continued to decline.

Figure 1 presents the variations across various product sub-segments of the two-

wheeler industry between FY1995 and FY2004.

Demand Drivers The demand for two-wheelers has been influenced by a number of factors over the past

five years. The key demand drivers for the growth of the two-wheeler industry are as

follows:

Inadequate public transportation system, especially in the semi-urban and rural

areas;

Increased availability of cheap consumer financing in the past 3-4 years;

Increasing availability of fuel-efficient and low-maintenance models;

Increasing urbanization, which creates a need for personal transportation;

Changes in the demographic profile;

Difference between two-wheeler and passenger car prices, which makes two-

wheelers the entry-level vehicle;

Steady increase in per capita income over the past five years; and

Increasing number of models with different features to satisfy diverse consumer

needs.

BAJAJ Auto limitedBajaj Auto is a major Indian automobile manufacturer. It is India's largest and the world's

4th largest two- and three-wheeler maker With Kawasaki Heavy Industries of Japan,

Bajaj manufactures state-of-the-art range of two-wheelers. The brand, Pulsar is

continually dominating the Indian motorcycle market in the premium segment. Its

Discover DTSi is also a successful bike on Indian roads.

It is based in Pune, Maharashtra, with plants in Akurdi and Chakan (Pune),Waluj (near

Aurangabad) and Pantnagar in Uttaranchal. Bajaj Auto makes and exports motor

scooters, motorcycles and the auto Rickshaw.

The Forbes Global 2000 list for the year 2005 ranked Bajaj Auto at 1946. Over the last

decade, the company has successfully changed its image from a scooter manufacturer

to a two wheeler manufacturer. Its product range encompasses scooterettes, scooters

and motorcycles. Its real growth in numbers has come in the last four years after

successful introduction of a few models in the motorcycle segment.

The company is headed by Rahul Bajaj who is worth more than US$1.5 billion.

Bajaj Auto came into existence on November 29, 1945 as M/s Bachraj Trading

Corporation Private Limited. It started off by selling imported two- and three-wheelers in

India. In 1959, it obtained license from the Government of India to manufacture two- and

three-wheelers and it went public in 1960. In 1970, it rolled out its 100,000th vehicle. In

1977, it managed to produce and sell 100,000 vehicles in a single financial year. In

1985, it started producing at Waluj in Abramabad. In 1986, it managed to produce and

sell 500,000 vehicles in a single financial year. In 1995, it rolled out its ten millionth

vehicles and produced and sold 1 million vehicles in a year.

Bajaj's Small Car in 2010

India's second largest bike manufacturer Bajaj Auto Ltd has announced to launch its concept car by 2010. The small 'Lite' will be in competition to Tata Nano which is tagged as world's cheapest car. This small

concept car is being designed in collaboration with Renault and Nissan but it will not be for Rs 1 lakh. Bajaj Auto managing director Rajiv Bajaj said that the focus is on performance of the car rather than cost. Bajaj motors has clarified that mileage, maintenance and carbon emissions. Are the sole objectives in this Lite's

design?

Quick Facts

Founder Jamnalal Bajaj

Year of Establishment 1926

Industry Automotive - Two & Three Wheelers

Business Group The Bajaj Group

Listings & its codes BSE - Code: 500490; NSE - Code: BAJAJAUTO

Presence Distribution network covers 50 countries.

Dominant presence in Sri Lanka, Bangladesh, Columbia,

Guatemala, Peru, Egypt, Iran and Indonesia.

Joint Venture Kawasaki Heavy Industries of Japan

Registered & Head Office Akurdi

Pune - 411035

India

Tel.: +(91)-(20)-27472851

Fax: +(91)-(20)-27473398

Works Akurdi, Pune 411035

Bajaj Nagar, Waluj Aurangabad 431136

Chakan Industrial Area, Chakan, Pune 411501

E-mail [email protected]

Website www.bajajauto.com

Segment and Brands

Products Brands

Motorcycles4S 4S Champion Bajaj Avenger

Bajaj Pulsar 135

New

Bajaj CT 100 Bajaj Discover Bajaj PlatinaBajaj Platina DTS

SI

Bajaj PulsarBajaj Pulsar

DTSi

BAJAJ PULSAR

DTS FI 220

Kawasaki Ninja

250 New

Bajaj SonicBajaj Wind

125Bajaj XCD 125

Boxer Caliber Caliber115

Kawasaki Bajaj

EliminatorKB RTZ KB100

KB125

Scooters Bajaj Chetak Bajaj Kristal Dtsi Bajaj Wave

Awards & Accolades

2005 Bajaj Discover DTS-i was chosen as Bike of the Year and

Indigenous Design of the Year by Overdrive Awards.

2004 Bajaj Auto was chosen as Bike Maker of the Year by ICICI Bank

Overdrive Awards.

DTS-i Technology was chosen as Auto Tech of the Year by ICICI

Bank Overdrive Awards.

Bajaj Pulsar DTS-i became Bike of the Year by ICICI Bank

Overdrive Awards.

Wind 125 chosen as the Two Wheeler of the Year by CNBC

AUTOCAR Awards.

Wind 125 chosen as the Bike of the Year by Business Standard

Motoring.

2003 Bajaj Pulsar 180 DTS-i chosen as Wheels Viewers Choice Two

Wheeler of the Year and Best Two Wheeler by BBC World Wheels

Award.

Bajaj Pulsar 150 DTS-i chosen as Best Two Wheeler between Rs.

45,000 to Rs. 55,000 by BBC World Wheels Award.

Bajaj Boxer AT KTEC chosen as Best Two Wheeler under Rs.

30,000 by BBC World Wheels Award.

Bajaj Pulsar chosen as Motorcycle Total Customer Satisfaction

Study by NFO Automotive.

Bajaj Pulsar chosen as Bike of the Year by ICICI Bank OVERDRIVE

Awards.

2002 Bajaj Pulsar chosen as Most Exciting Bike of the Year by

OVERDRIVE Awards.

Bajaj Eliminator chosen as Bike of the Year by OVERDRIVE

Awards.

2001 Bajaj Eliminator chosen as Most Exciting Bike of the Year by

OVERDRIVE Awards.

Sales Performance

Sales 2004-05 (Nos.) 2003-04 (Nos.)

Motorcycle 1,449,710 1,023,551

Other two-wheelers 152,936 265,398

Total two wheelers 1,602,646 1,288,949

Three wheeler 222,053 229,182

Total two & three wheelers 1,824,699 1,518,131

Of the above, exports were:-

Two wheelers 130,945 90,210

Three wheelers 65,765 65,797

Total Exports 196, 710 156,007

Financials at a Glance

Quarter

Ended

31.12.05

Quarter

Ended

31.12.04

Nine Months

Ended

31.12.05

Nine Months

Ended

31.12.04

Year Ended

31.03.05

(Audited)

Segment Revenue

Automotive 20020.4 16071.8 55054.0 42852.1 59338.9

Insurance 9839.6 2917.4 20847.3 7303.1 14325.4

Investment &

Others1074.8 873.9 3404.3 2818.3 4095.2

Total 30934.8 19863.1 79305.6 52973.5 77759.5

Less: Inter

segment Revenue57.3 39.2 211.6 245.4 290.7

Net Sales/Income

from operations30877.5 19823.9 79094.0 52728.1 77468.8

Segment Results

Automotive 3069.5 1863.5 8067.0 5217.6 7233.4

Insurance (259.3) 59.8 (363.9) 451.5 402.1

Investment &

Others927.8 856.4 3139.3 2683.8 3877.8

Total 3738.0 2779.7 10842.4 8352.9 11513.3

Less: Interest 1.4 2.7 2.8 5.0 6.7

Total Profit

Before Tax3736.6 2777.0 10839.6 8347.9 11506.6

Capital Employed

Automotive 9916.9 7931.6 9916.9 7931.6 9084.9

Insurance 3853.7 3625.1 3853.7 3625.1 3355.7

Investment &

Others53308.0 46392.0 53308.0 46392.0 47354.6

Unallocable 1069.3 329.1 1069.3 329.1 (1729.9)

Total 68147.9 58277.8 68147.9 58277.8 58065.3

Milestones

2005 Bajaj Avenger and Bajaj Wave launched.

2004 Bajaj Discover DTS-i, New Bajaj Chetak 4 stroke with Wonder Geaf

and Bajaj CT100 launched. Bajaj also unveils new brand identity, dons

new symbol, logo and brand line.

2003 Pulsar DTS-i and Bajaj Wind 125-The World Bike was launched. In the

executive motorcycle segment, its Caliber 115 "Hoodibabaa!" was

launched. 107,115 Motorcycles sold in a month.

2001 Launches Pulsar and Eliminator.

2000 Bajaj Saffire was introduced.

1999 Caliber motorcycle notches up 100,000 sales in record time of 12

months. Production commences at Chakan plant.

1998 Kawasaki Bajaj Caliber rolls out of Waluj. Legend, India's first four-

stroke scooter rolls out of Akurdi. Spirit launched

Outlook

Since 1986, there is a technical tie-up of Bajaj Auto Ltd. with Kawasaki Heavy Industries

of Japan to manufacture state-of-art range of latest two-wheelers in India. The JV has

already given the Indian market the KB series, 4S and 4S Champion, Boxer, the Caliber

series, and Wind125.

Kawasaki Heavy Industries is a Fortune 500 company with a turnover of USD 10 billion

(Rs. 45,840 crore). It has crafted new technologies for more than hundred years. The

technologies of KHI have redefined space systems, aircrafts, jet engines, ships,

locomotive, energy plants, automation system, construction machinery, and of course

high reliability two-wheelers.

KHI has given the world its legendary series of 600-1200cc Ninja and 1600 Vulcan

bikes. Straight from its design boards, the Kawasaki Bajaj Eliminator, India's first real

cruiser bike, redefines the pleasure of "biking" in looks as well as performance.

Company Flashback

'Inspiring Confidence,' the tagline, has build up confidence, through excitement

engineering, not only to domestic consumers but also internationally. Established just

eight decades back in 1926 by Jamnalal Bajaj, the company has been vested with

India's largest exporter of two and three wheelers, 196,710 units in 2004-05, a great 26

per cent jump over the previous year.

Bajaj Auto Ltd. sales have increased by approximately 21 per cent in the year 2004-05,

which exceeds Rs 65.4 billion, a record in the history of the company. The gross

operating profit stands at Rs. 9.3 billion, again a record. The profits after tax of the BAL

are close to Rs. 7.7 billion, and the pre-tax return on operating capital is at an impressive

80 per cent.

The strength of the company is its quality products, excellence in engineering and

design, and its ability to delight the customers. The Pulsar, introduced in November

2004, is continually dominating the premium segment of the motorcycle market, helping

to maintain the market superiority. Discover DTSi, one more successful bike on Indian

roads, is in the 'value' segment of the motorcycle market. It incorporates a high degree

of power with fuel efficiency of a 100 cc motorcycle.

BAL is committed to prevention of pollution, continual improvement of environment

performance and compliance with all environmental legislation and regulations. They

always believe in providing the customer 'value for money' and keeps an special eye

upon quality, safety, productivity, cost and delivery.

BAJAJ PULSAR

Bajaj Pulsar is a motorcycle brand owned by Bajaj Auto in India. The two wheeler was

developed by the product engineering division of Bajaj Auto in association with

motorcycle designer Glynn Kerr Tokyo R&D. Currently there are four variants available -

with engine capacities of 150cc, 180 and two variants with capacities of 220 cc. More

than a million units of Pulsar were sold by November 2005. A Pulsar 200

variant was discontinued in July 2009. With monthly sales of more than 48,000 units in

June 2009, Pulsar is the leader in the 150 cc segment in India with a market share of

43%.

Before the introduction of the Pulsar, the Indian motorcycle market trend was towards

fuel efficient, small capacity motorcycles (that formed the 80-125 cc class). Bigger

motorcycles with higher capacity virtually did not exist (except for Enfield Bullet). The

launch and success of Hero Honda CBZ in 1999 showed that there was demand for

performance bikes. Bajaj took the cue from there on and launched the Pulsar twins in

India on November 24, 2001. Since the introduction and success of Bajaj Pulsar, the

Indian youth began expecting high power and other features from affordable

Motorcycles.

Updates on Bajaj Pulsar

Bajaj Auto has now introduced a new colour, Metallic Orange to Bajaj Pulsar. The

availability of color variants always attract customers. Moreover metallic orange is a real

vibrant option to go for. It will be a good option for those who like lively colours and want

to look different in crowd. New Bajaj Pulsar to be launch in 2011 with new style and

effects.

Bajaj Pulsar 135 DTS-i

It is the flagship variant of Bajaj Pulsar is powered by the

135cc engine. This is the word's first 4 valve powered

bike.

Bajaj Pulsar 150 DTS-iThis is the first model of Bajaj Pulsar series in India

powered by a 150cc mill.

Bajaj Pulsar 180 DTS-i

This variant of Bajaj Pulsar is powered by the more

powerful 178.6cc engine that delivers more power and

torques that results good engine performance and

acceleration. Its wheelbase is higher than Bajaj Pulsar

150 DTS-i.

Bajaj Pulsar 220 DTS-i It is the top end variant of Bajaj Pulsar which is powered

by the more powerful 220cc, Oil-Cooled petrol engine. It

offers better engine performance and acceleration in

comparison to the lower variants.

Bajaj Pulsar Bikes

Bajaj Pulsar 220 DTSi

Price Rs.82, 165 Bajaj Pulsar 220 DTSi in Delhi

Average 35 kmpl Petrol

Engine 220 cc

Bajaj Pulsar 200cc DT

Price Rs.67, 755 Bajaj Pulsar 200cc DTSi in Delhi

Average 38.3 kmpl Petrol

Engine 200 cc

Bajaj New Pulsar 180cc DTSi

Price Rs.64, 736 Bajaj New Pulsar 180cc DTSi in Delhi

Average 45 kmpl Petrol

Engine 180 cc

Bajaj New Pulsar 150cc DTSi

Price Rs.61,605 Bajaj New Pulsar 150cc DTSi in Delhi

Average 48.4 kmpl Petrol

Engine 150 cc

Bajaj Pulsar 135

Price Rs.52,997 Bajaj Pulsar 135 in Delhi

Average 54kmpl Petrol

Engine 134.66cc

.

Competitors of bajaj pulsar

TWO WHEELERS IN INDIA

The feeling of freedom and being one with the Nature comes only from riding a two

wheeler. Indians prefer the two wheelers because of their small manageable size, low

maintenance, pricing and easy loan repayments. Indian streets are full of people of all

age groups riding a two wheeler. Motorized two wheelers are seen as a symbol of status

by the populace. Thus, in India, we would see swanky four wheels jostling with our ever

reliable and sturdy steed: the two wheeler

India is the second largest producer and manufacturer of two-wheelers in the world. It

stands next only to Japan and China in terms of the number of two-wheelers produced

and domestic sales respectively. Indian two-wheeler industry has got spectacular growth

in the last few years. Indian two-wheeler industry had a small beginning in the early 50's.

The Automobile Products of India (API) started manufacturing scooters in the country.

Bikes are a major segment of Indian two wheeler industry, the other two being scooters

and mopeds. Indian companies are among the largest two-wheeler manufacturers in the

world.

In the initial stages, the scooter segment was dominated by API; it was later overtaken

by Bajaj Auto. Although various government and private enterprises entered the fray for

scooters, the only new player that has lasted till today is LML.

The motorcycle segment was initially dominated by Enfield 350cc bikes and Escorts

175cc bike.

The two-wheeler market was opened to foreign competition in the mid-80s. And the then

market leaders - Escorts and Enfield - were caught unaware by the onslaught of the

100cc bikes of the four Indo-Japanese joint ventures. With the availability of fuel efficient

low power bikes, demand swelled, resulting in Hero Honda - then the only producer of

four stroke bikes (100cc category), gaining a top slot.

The first Japanese motorcycles were introduced in the early eighties. TVS Suzuki and

Hero Honda brought in the first two-stroke and four-stroke engine motorcycles

respectively. These two players initially started with assembly of CKD kits, and later on

progressed to indigenous manufacturing. In the 90s the major growth for motorcycle

segment was brought in by Japanese motorcycles, which grew at a rate of nearly 25%

CAGR in the last five years.

The industry had a smooth ride in the 50s, 60s and 70s when the Government prohibited

new entries and strictly controlled capacity expansion. The industry saw a sudden

growth in the 80s. The industry witnessed a steady growth of 14% leading to a peak

volume of 1.9mn vehicles in 1990.

In 1990, the entire automobile industry saw a drastic fall in demand. This resulted in a

decline of 15% in 1991 and 8% in 1992, resulting in a production loss of 0.4mn vehicles.

Barring Hero Honda, all the major producers suffered from recession in FY93 and FY94.

Hero Honda showed a marginal decline in 1992.

The reasons for recession in the sector were the incessant rise in fuel prices, high input

costs and reduced purchasing power due to significant rise in general price level and

credit crunch in consumer financing. Factors like increased production in 1992, due to

new entrants coupled with the recession in the industry resulted in company either

reporting losses or a fall in profits.

Key players in the Two-wheeler Industry:

There are many two-wheeler manufacturers in India. Major players in the 2-wheeler

industry are Hero Honda Motors Ltd (HHML), Bajaj Auto Ltd (Bajaj Auto) and TVS

Motor Company Ltd (TVS).

The other key players in the two-wheeler industry are Kinetic Motor Company Ltd

(KMCL), Kinetic Engineering Ltd (KEL), LML Ltd (LML), Yamaha Motors India Ltd

(Yamaha), Majestic Auto Ltd (Majestic Auto), Royal Enfield Ltd (REL) and Honda

Motorcycle & Scooter India (P) Ltd (HMSI).

Types of Two-wheelers in India:

There are mainly three types of two-wheelers available in India. They are Motorcycles,

Scooters and Scooterettes/Mopeds.

Motorcycles in India:

Bikes comprise a major segment of Indian two wheeler industry.

Company : Bajaj Auto Ltd Company : HERO HONDA

* Bajaj Avenger

* Bajaj CT 100

* Bajaj Platina

* Bajaj Discover DTSi

* Bajaj Pulsar DTSi

* Bajaj Wave

* Bajaj Wind 125

Sonic DTSi * Hero Honda Achiever

* Hero Honda CD Dawn

* Hero Honda CD Deluxe

* Hero Honda Glamour

* Hero Honda Glamour-Fi

* Hero Honda Karizma

* Hero Honda Passion Plus

* Hero Honda Pleasure

* Hero Honda Super Splendor

* Hero Honda Splendor NXG

* Hero Honda CBZ X-Treme

Company : Kinetic Motor Company Company : TVS Motor Company : Yamaha

Motor India

* Kinetic Aquila

* Kinetic Boss

* Kinetic Challenger

* Kinetic Comet

* Kinetic GF

* TVS Apache

* TVS Centra

* TVS Fiero

* TVS Star

* TVS Victor * Yamaha CruxS

* Yamaha G5

* Yamaha Gladiator

Competitors

COMPANY SYMBOL

Bajaj Auto Ltd. BAJAUL

Atul Auto Ltd. ATUAUTHero Honda Motors Ltd. HEROHOKinetic Engineering Ltd. KINENGKinetic Motor Company Ltd. KINMOTLML Ltd. LMLLTDMaharashtra Scooters Ltd. MAHSCOMajestic Auto Ltd. MAJAUTScooters India Ltd. SCOOINSunku Auto Ltd. SUNKAUTVS Motor Company Ltd. TVSMVCCL Ltd. VCCLTD

CompetitionLast Price Market Cap.

(Rs. cr.)Sales

TurnoverNet Profit Total Assets

Bajaj Auto 1,613.25 46,682.13 11,920.98 1,700.11 4,266.92Hero Honda 1,936.55 38,670.48 15,860.51 2,231.83 3,531.05TVS Motor 81.80 3,886.21 4,430.13 88.02 1,868.67Mah Scooters 405.25 463.14 4.42 8.41 200.56LML 11.90 97.56 235.92 -40.01 -75.57Kinetic Motor 30.95 73.49 15.70 97.61 29.99

S.W.O.T. analysis of(bajaj pulsar 200cc)STRENGTHS:

• Pulsar 200cc features India’s First Oil Cooled Engine which delivers maximum power making it most powerful engine offered by Bajaj.

• New Pulsar also provides Digital Speedometer, Self Canceling Indicators which is for the First time in this segment in India.

• Fuel efficiency: Pulsar 200cc delivers an impressive mileage of 38.2 kmpl in city as compared to Karizma which delivers 30 kmpl in city.

• Customer Base: In past decade Bajaj has established a strong base amongst its customers.

WEAKNESS:

• Style and Design: PULSAR 200cc and 220cc derives their styling from there previous version Pulsar 150 Dts-i and 180 Dts-i.

• Pricing; Bajaj 220cc (Rs 82449 basic price) is costlier than karizma (Rs 78000 basic price)

OPPORTUNITIES:

• If they derive new styling, shape, design for pulsar 200cc and 220cc then they can attract more customers.

• Taking into consideration the reviews of the customers regarding the “fairing” of 220cc and making the needful changes will be an opportunity to capture an even larger share

of the 200cc+ segment.

THREATS:

• The biggest threat is faced from the goodwill of Karizma in this segment who is the “Four-Stroke Two Wheeler Ruler” of the Indian bike market.

• Certain technical faults in the bike design which are potentially dangerous to the rider’s safety can be disastrous to the image of the bike.

Objective of Study

The objective of this research is to determine the customer as well as retailers

preferences regarding different brands of motorcycles which result in their market share.

It involves the study of consumers’ buying behavior and attitudes towards a variety of

attributes and factors, which help them in decision-making.

The brand I have chosen to focus on BAJAJ AUTO Ltd.’s PULSAR brand of bikes. I

studied the company profile, its market structure, the brand awareness, growth rates and

popularity among consumers so as to forecast the future sales and understand the

growth trends.

I have designed a questionnaire to survey various dealers and consumers to understand

the demand and supply situation of the bike market. Secondary data from the internet is

used for effective analysis.

Importance of Study

The importance of this study is to practically understand the relevance of the concepts of

managerial economics in the business organizations and here in the realm of the

motorcycles industry.

The present market scenario is analyzed and future demands forecasted using the

simple regression techniques. Also, a comprehensive study of the major factor is

involved in this market will conduct so as to see how different and similar a market

structure is from the theories.

MethodologyData Collection

Research has been designed on the basis of both primary data and secondary data.

I. Sources Of Information

Primary data collection:

For primary data collection I designed a questionnaire to survey various dealers and

consumers. The objective of survey is to understand the consumer preferences among

various brands of motorcycles available in the market and the factors affecting consumer

buying process.

Sample size for the survey will be around 150

Secondary data collection:

Internet is the major source for secondary data. Apart from understanding the bike

industry in general and Bajaj in specific, my major task is to analyze the consumer

demand for Baja’s Pulsar’s brand and project the future sales for the company.

II. Sampling Methodology

Sampling is the process of selecting a small number of elements from a larger defined

target group of elements such that the information gathered from the small group will

allow judgments to be made about the larger groups. Sampling is that part of statistical

practice concerned with the selection of individual observations intended to yield some

knowledge about a population of concern, especially for the purposes of statistical

inference. Each observation measures one or more properties.

III.Sampling Technique:

A sample design is a definite plan for obtaining a sample from a sample frame it refers

to the technique or the procedure that the researcher would adapt in selecting some

sampling units from which inferences about the population is drawn. Basically it was

convenience sampling suiting to use.

Initially, a rough draft was prepared keeping in mind the objective of the research. A pilot

study was done in order to know the accuracy of the Questionnaire. The final

Questionnaire was arrived only after certain important changes were done. Thus my

sampling came out to be judgmental and convenient.

Convenience Sampling

The sampling used in the study is convenience sampling. This method is also known as

‘chunk’, which refers to the fraction of the population being investigated. This selection is

neither based on random nor on convenience. The convenience may be about place,

time and availability of resource.

IV.Sampling Unit:

A sample is a part of whole to show what the rest is like. Sampling helps to determine

the corresponding value of the population.

The respondents who were asked to fill out questionnaires are the sampling units. These

comprise of knowledgeable persons, computer programmers, computer teachers and

users at various schools and institutes.

Sampling Area: The area of the research was Dehradun Uttarakhand.

Time Period: Research was done in the months of October and November, 2010.

Contact Method:

The marketing researchers have four choices to contact the respondents: Mail,

Telephone, and Personal and Online interview. I have chosen the personal interview

since personal interviewing is the most versatile method.

Data Analysis:

Pie chart has been used for the analysis of data.

Market share and Growth

rates

Two- wheeler sales in the country have sky rocketed in the recent years, and the annual

sales of motorcycles in India expected to cross the 10million mark by 2010. The low

penetration of two-wheelers in the country 31 two-wheelers per 1000 citizens (2004)

leaves immense scope for the growth of the market. Overall the industry sales of two-

wheelers have grown by 15% from 6.57 million in 2004/2005 to 7.57 million in

2005/2006. The buoyant Indian economy with a growth rate of around 8% per annum is

further expected to fuel the growth of two wheelers in the country.

The share of motorcycles have increased over the years, while that of other two-

wheelers like geared scooters, cooperates and mopeds have shown a negative

growth or remained stagnant. The two-wheelers have penetrated 7% of rural house hold

and 24% of urban markets, thus it leaves an immense scope for the market to grow.

Bajaj Auto one of the leading producers of automobiles in the country has been

able to sell close to 2.3 million vehicles in 2005/2006, the sales of the company

grew by almost 31%. The company registered a 32% growth in the sales of

motorcycles much above the industry average of 19%. Bajaj Auto has emerged as a

market leader in the entry level or price segment motorcycle with the Bajaj CT 100

accounting for nearly 40% of the market share. It also commands a 62%

market share in the premium segment of motorcycles with products like the Bajaj

Pulsar DTSI. TVS Motors which has lots of firsts to its credit in the two-wheeler

sector in the country was able to sell 1.34 million units during the same period thus

registering an overall growth of 15% from the previous year. In the motorcycle segment

the company's growth in sales was in sync with the industry average.

. f this figures have daunted you the best is yet to come, the country leader in two-

wheelers hero Honda have crossed the three million mark during the year 2005/2006

which is a good few lakhs more than its nearest competitor Bajaj Auto. The company

accounted for nearly 40% of then two-wheeler market. In the motorcycle segment the

company has been able to attain a market share of about 50%. The segment in which

hero Honda has emerged as a clear winner is the Deluxe segment, which is the largest

segment in the motorcycles category, with its flagship family of motorcycles splendor

selling over 1.2 million units which is just a shade less than all the two wheelers sold by

TVS during the same year.

The motorcycle category is expected to see a further growth and according to industry

experts it will drive all other category of two- wheelers to the periphery.

The table below shows the over all trend of Industry Sales over a 5 year period. The

figures are provided by the Society of automobile Manufactures Association (SIAM).

Two-wheeler domestic sales trend Motorcycles

2001-02 2002-03 2003-04 2004-05 2005-062887194 3647493 4170445 4964753 5815417

Market Share

Year ended 31

MarchMarket (nos.) Market growth BAL (nos.) Balk’s growth

BAL's market

share

2005 5,217,996 20.9% 1,449,710 41.6% 27.8%

2004 4,316,777 14.9% 1.023,551 17.9% 23.7%

2003 3,757,125 31.3% 868,138 32.3% 23.1%

2002 2,861,375 40.7% 656,018 55.4% 22.9%

2001 2.033,196 - 422,016 - 20.8%

Market structure This industry is a high volume, medium growth sector characterized by excess/ idle

capacities owing to in efficient operations. Imports have not been influencing prospects,

as high government regulations limit this .Characteristics

• Bikes: primarily a commodity market - price sensitive

• Effective distribution chain - through a simple network of dealers

And franchises.

• Regulation - Emission norms as well as import regulations are in

Existence.

• Market - Urban areas are the largest market for Pulsar, followed by small

Towns and then rural centers.

The market of motorcycles shows a monopolistic structure due to the

Following factors:

• Different and many players in the market

• Differentiated products.

• Prices charged are different.

• The competition is a non price competition i.e. on the basis of

Advertising and delivering differentiated products.

Primary data analysis

1. AGE GROUP CLASSIFICATION OF CUSTOMER PREFFERING BAJAJ PULSAR

18-24 24-30 30-36 Above 36No of 35 47 41 27

peoplepercentage

23% 32% 27% 18%

age group

18-24, 35, 23%

24-30, 47, 32%30-36, 41, 27%

above 36, 27, 18%

18-24

24-30

30-36

above 36

As is clear the maximum buyers are of the age group 24-30 i.e 32%, hence it

Can be interpreted as being popular in college going youth.

2. BIKES OWNED (CATEGORIZATION)-

Pulsarbajaj splendor

Apache unicorn

Cd-down Enfield

Bullet (old) hunk enticer

Ct100 CBZ

Pulsar DTS i Hero Honda

Q3.ANNUAL HOUSEHOLD INCOME

a. <I LAKH b.1-3 LAKH

c.3-5 LAKH d.5-10 LAKH

e.>10 LAKH

<1 lakh 1-3 lakh 3-5 lakh 5-10 lakh >10 lakh

No of

customer

5 30 51 31 17

%age 3% 20% 35% 31% 11%

income group

<1 lakh, 5, 3%1-3 lakh, 30, 20%

3-5 lakh, 51, 35%

5-10 lakh, 47, 31%

>10 lakh, 17, 11% <1 lakh

1-3 lakh

3-5 lakh

5-10 lakh

>10 lakh

Which shows that a majority group belonging to the pulsar kind of bikes

Is more from the income group category 3-5 & 5-10 lakh groups.

Moreover very less of the customer was from < 1 lakh category which is also an

Important finding from the marketing point of view.

Q4.PURPOSE OF YOUR BIKE

a. OFFICE

b.TRAVELLING

c.HOUSEHOLD

d.ADVENTURE

office traveling household adventure

No of people 55 27 15 53

%age 37% 18% 10% 35%

PURPOSE

OFFICE, 55, 37%

TRAVELLING, 27, 18%

OUSEHOLD, 15, 10%

ADVENTURE, 53, 35% OFFICE

TRAVELLING

OUSEHOLD

ADVENTURE

Which shows that a majority group buy the pulsar kind of bikes

Is more for the office purpose i.e 37%.

Moreover very less of the customer buy the pulsar bike for the household purpose

Q5. BUYING DECISION

a. MILEAGE

b.LOOKS

c.BRAND

d.SERVICE

e.PRICE

mileage looks brand service price

No of

people

38 41 31 28 12

%age 25% 27% 21% 19% 8%

FACTORS

MILEAGE, 38, 25%

LOOKS, 41, 27%BRAND, 31, 21%

SERVICE, 28, 19%

PRICE, 12, 8%

MILEAGE

LOOKS

BRAND

SERVICE

PRICE

People consider ‘looks’ as the most important parameter for the selection of bike. Other

than that parameters like ‘mileage’ and ‘brand’ also hold importance for the selection of

a bike. It can be inferred from the data that these three parameters need to be given

some more importance from the company’s side in order to attain or retain the

customers.

Q6.PURCHAGE DECISION

a. FRIENDS

b.FAMILY

c.DEALER

friends family dealer

No of people 70 49 31

%age 46% 33% 21%

PURCHASE DECISION

FRIENDS, 70, 46%

FAMILY, 49, 33%

DEALER, 31, 21%

FRIENDS

FAMILY

DEALER

From the above data it can be interpreted as most of the consumers are influenced by

the friends to evaluate and to take purchase decision for the bike.

Q7.MEDIA IS NOTICED FOR AN ADVERTISEMENT

a. TELEVISION

b.HOARDINGS

c.PRINTMEDIA

d.INTERNET

television hoarding printmedia internet

No of people 55 41 30 24

%age 37% 27% 20% 16%

MEDIA

TELEVISION, 55, 37%

HOARDINGS, 41, 27%

PRINTMEDIA, 30, 20%

INTERNET, 24, 16% TELEVISION

HOARDINGS

PRINTMEDIA

INTERNET

From the data we can infer that television is most likely to noticed by many people for

the advertisement. This can be taken as a good opportunity for the company to increase

the frequency of advertisement through television

Q8.BRAND WHICH IS EASY TO RECALL

a.BAJAJ

b.HERO HONDA

c.YAMAHA

d.HONDA

bajaj Hero honda yamaha honda

No of people 55 41 30 24

%age 37% 27% 20% 16%

EASY TO RECALL

BAJAJ, 55, 37%

HEROHONDA, 41, 27%

YAMAHA, 30, 20%

HONDA, 24, 16% BAJAJ

HEROHONDA

YAMAHA

HONDA

From the above data it is interpreted as more people are very comfortable to recall the

bajaj.It is easily recalled.

Q9.PERCEPTION PARAMETER ABOUT PULSAR

a. STYLE

b.POWER

c.PERFORMANCE

d.VALUE

e.BRAND

Style power performance value brand

No of

customer

35 25 39 10 41

%age 23% 17% 26% 7% 27%

PERCEPTION PARAMETER

STYLE, 35, 23%

POWER, 25, 17%PERFORMANCE,

39, 26%

BRAND, 41, 27%

VALUE, 10, 7% STYLE

POWER

PERFORMANCE

BRAND

VALUE

From the above chart it can be interpreted that bajaj is the leading brand in bike market

with a very good image among its consumers. Most of the consumers evaluate that

quality of the bajaj product on the basis of their brand and their performance. It can also

improve its power & position by updating customers regularly about BAJAJ.

Questionnaire for Bike Customers Name of the participant… project owner: - Rashmi kumari

Age… Script owner: - ICFAI university, Dehradun

Occupation…

Q1.AGE GROUP CLASSIFICATION OF CUSTOMER PREFFERING BAJAJ PULSAR

18-24 24-30 30-36 ABOVE 36

Q2.WHICH BIKE DO YOU OWN PRESENTLY?

Q3.ANUAL HOUSEHOLD INCOME

<I LAKH 1-3 LAKH

3-5 LAKH 5-10 LAKH

>10 LAKH

Q4.WHAT IS THE PURPOSE OF YOUR BIKE?

a) OFFICE b) TRAVELLING c) HOUSEHOLD d) ADVENTURE

Q5.RATE THE KEY FACTORS WHICH AFFECTED YOUR BUYING DECISION?

a) MILEAGE b) LOOKS c) BRAND d) SERVICE e)

PRICE

Q6.WHICH OF THE FOLLOWING INFLUENCES YOUR PURCHASE

DECISION?

a) FRIENDS b) FAMILY c) DEALER

Q7.WHICH OF THE FOLLOWING MEDIA ARE YOU MOST LIKELY TO NOTICE AN ADVERTISEMENT

a) TELEVISION b) HOARDING c) PRINT MEDIA d) INTERNET

Q8.WHICH BRAND NAME DO YOU FIND EASY TO RECALL?

a) BAJAJ b) HERO HONDA c) YAMAHA d) HONDA

Q9.RATE YOUR PERCEPTION ABOUT PULSAR ON THE FOLLOWING FACTORS-

a) STYLE b) POWER c) PERFORMANCE d) VALUE

e) BRAND

ConclusionBrand positioning is the first challenge of any marketing strategy. BAJAJ enjoys a good

position in the market. It can tap its huge potential by reaching to the customers

especially in the case of this study.

Many strategic possibilities wait for the company to expand its sales volume and

invariably making a scalable revenue proportion. To date, company’s marketing effort is

warped. Analysis reveals the strengths and challenges of the company with prominent

focus on immediate address to continual follow up of the prospective customers.

In my research period, I found that BAJAJ enjoys a great Brand Positioning among

customers. Most of them know BAJAJ for its good quality product like for its

performance, looks, mileage, for the adventure purpose also etc.

More and more advertisement should be shown through television to create awareness

among the customer because they are more interested in watching television and they

are also more infuenced by it.

To make BAJAJ first voice of the customers company can attract the new consumers by

providing them some good promotional schemes.

However we can’t forget the existing customers who prefer other competitor’s product

than BAJAJ. We should also make a good relation with them. We can also attract them

and persuade to buy BAJAJ product more & more by giving them any of good

promotional schemes like free after sale service, by giving free accessories (some part)

to the customer. Conclusively, I deem it fit to accelerate the marketing driven growth.

References

1 .www.bajajauto.com

2 .http://auto.indiamart.com/motorcycles/bajaj-pulsar

3 .http://www.fadaweb.com/two_wheeler_industry.htm

4 .auto.indiamart.com/motorcycles

5 .www.ilovei nd i a .com/ b i ke s /index.html

6 .www.infibeam.com/bi k e s /make/herohonda.html

7 .bikes.whereincity.com

8 .www.b i ke s alesi nd i a .com

15 .www.autoindiaforum.com/ba j a j -to-launch-6-new-b i ke

s -in- 2009.html