INTRODUCTION TO THE TOPIC The rapid pace of change and intense competitive pressure in today's marketplace demand that brands continuously innovate themselves to maintain their relevance and market position. TATA MOTORS has launched a new vehicle i-e “WINGER CARGO”. This vehicle belongs to the small commercial vehicle category. The special feature of the vehicle is the loading area and the closed container body. Tata winger cargo vehicle’s idea has been generated from Mercedes-benz sprinter with huge cargo space and easy navigation within city limits with no legal restrictions giving driver more choice, flexibility and efficiency to the trucking companies and to the customers . When there is a new launch it is quiet essential to make people aware of the new launched vehicle, find out their reactions and views. In order to survive in the cut throat competition the competitors and their strategies must be identified . The competitive advantages of TATA MOTORS are:- Geographical network of offices Ability to cross sell various TATA businesses Skill and leadership of its employees Depth of expertise Brand Independence Performance ethics Culture of integrity. Segmentation, targeting and positioning are the three important factors for the success of a new launched product. Branding is also an important factor that adds to the success of the product. This project deals with the branding and positioning aspects of the product WINGER CARGO. BRANDING A brand is the identity of a specific product, service, or business. Branding is the process of creating distinctive and durable perceptions in the minds of consumers. The benefits of branding are:- 1. Memorability- It is easier to remember the branded company than the what is its name. 2. Loyalty- When people have a positive experience with a memorable brand, they're more likely to buy that product or service again than competing brands. 3. Familiarity- Psychologists have shown that familiarity induces liking, and this makes even non-customers more likely to recommend a brand they know. 1
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INTRODUCTION TO THE TOPIC
The rapid pace of change and intense competitive pressure in today's marketplace demand that brands continuously innovate themselves to maintain their relevance and market position.
TATA MOTORS has launched a new vehicle i-e “WINGER CARGO”. This vehicle belongs to the small commercial vehicle category. The special feature of the vehicle is the loading area and the closed container body. Tata winger cargo vehicle’s idea has been generated from Mercedes-benz sprinter with huge cargo space and easy navigation within city limits with no legal restrictions giving driver more choice, flexibility and efficiency to the trucking companies and to the customers .
When there is a new launch it is quiet essential to make people aware of the new launched vehicle, find out their reactions and views. In order to survive in the cut throat competition the competitors and their strategies must be identified .
The competitive advantages of TATA MOTORS are:- Geographical network of offices Ability to cross sell various TATA businesses Skill and leadership of its employees Depth of expertise Brand Independence Performance ethics Culture of integrity.
Segmentation, targeting and positioning are the three important factors for the success of a new launched product. Branding is also an important factor that adds to the success of the product.
This project deals with the branding and positioning aspects of the product WINGER CARGO.
BRANDING
A brand is the identity of a specific product, service, or business. Branding is the process of creating distinctive and durable perceptions in the minds of consumers. The benefits of branding are:-
1. Memorability- It is easier to remember the branded company than the what is its name.
2. Loyalty- When people have a positive experience with a memorable brand, they're more likely to buy that product or service again than competing brands.
3. Familiarity- Psychologists have shown that familiarity induces liking, and this makes even non-customers more likely to recommend a brand they know.
4. Premium image, premium price- Branding can lift what you sell out of the realm of a commodity, with customers
willing to pay more for the well-branded product or service.
5. Extensions- With a well-established brand, you can spread the respect you've earned to a related new product, service or location more easily
6. Greater company equity- Making your company into a brand usually means that you can get more money for the company when you decide to sell it.
7. Lower marketing expenses- Although you must invest money to create a brand, once it's created you get a bigger bang for every marketing buck using it.
8. For consumers, less risk- People tend to choose the brand-name supplier over the no-name one when afraid of the consequences of a mess-up.
POSITIONING
• It means the process by which marketers try to create an image or identity in the minds of their target market for its product, brand, or organization.
• It is the aggregate perception the market has of a particular company, product or service in relation to their perceptions of the competitors in the same category.
• It will happen whether or not a company's management is proactive, reactive or passive about the on-going process of evolving a position. But a company can positively influence the perceptions through enlightened strategic actions.
• It is the third and the final step of STP(Segmentation, Targeting and Positioning).• After segmenting a market and then targeting a consumer, you would proceed to
position a product within that market.• Products or services are 'mapped' together on a 'positioning map'. This allows them to
be compared and contrasted in relation to each other. • This is the main strength of this tool. Marketers decide upon a competitive position
which enables them to distinguish their own products from the offerings of their competition (hence the term positioning strategy).
• According to Solomon, position strategy is an essential part in the marketing efforts because companies have to use the elements in the marketing mix to influence the customers understanding of the position
• The goal of positioning strategies relates to the management of consumers' perceptions. However, positioning focuses on the creation of brand associations - consumers' perceptions of the attributes that differentiate the brand from competitive offers
Tata Motors Limited is India's largest automobile company, with consolidated revenues of Rs.70, 938.85 crores (USD 14 billion) in 2008-09. It is the leader in commercial vehicles in each segment, and among the top three in passenger vehicles with winning products in the compact, midsize car and utility vehicle segments. The company is the world's fourth largest truck manufacturer, and the world's second largest bus manufacturer.
The company's 24,000 employees are guided by the vision to be "BEST IN THE MANNER IN WHICH WE OPERATE BEST IN THE PRODUCTS WE DELIVER AND BEST IN OUR VALUE SYSTEM AND ETHICS."
Established in 1945, Tata Motors' presence indeed cuts across the length and breadth of India. Over 4 million Tata vehicles ply on Indian roads, since the first rolled out in 1954. The company's manufacturing base in India is spread across Jamshedpur (Jharkhand), Pune (Maharashtra), Lucknow (Uttar Pradesh), Pantnagar (Uttarakhand) and Dharwad (Karnataka). Following a strategic alliance with Fiat in 2005, it has set up an industrial joint venture with Fiat Group Automobiles at Ranjangaon (Maharashtra) to produce both Fiat and Tata cars and Fiat power trains. The company's dealership, sales, services and spare parts network comprises over 3500 touch points; Tata Motors also distributes and markets Fiat branded cars in India.
Tata Motors, the first company from India's engineering sector to be listed in the New York Stock Exchange (September 2004), has also emerged as an international automobile company. Through subsidiaries and associate companies, Tata Motors has operations in the UK, South Korea, Thailand and Spain. Among them is Jaguar Land Rover, a business comprising the two iconic British brands that was acquired in 2008. In 2004, it acquired the Daewoo Commercial Vehicles Company, South Korea's second largest truck maker. The rechristened Tata Daewoo Commercial Vehicles Company has launched several new products in the Korean market, while also exporting these products to several international markets. Today two-thirds of heavy commercial vehicle exports out of South Korea are from Tata Daewoo. In 2005, Tata Motors acquired a 21% stake in Hispano Carrocera, a reputed Spanish bus and coach manufacturer, and subsequently the remaining stake in 2009. Hispano's presence is being expanded in other markets. In 2006, Tata Motors formed a joint venture with the Brazil-based Marcopolo, a global leader in body-building for buses and coaches to manufacture fully-built buses and coaches for India and select international markets. In 2006, Tata Motors entered into joint venture with Thonburi Automotive Assembly Plant Company of Thailand to manufacture and market the company's pickup vehicles in Thailand. The new plant of Tata Motors (Thailand) has begun production of the Xenon pickup truck, with the Xenon having been launched in Thailand in 2008.
Tata Motors is also expanding its international footprint, established through exports since 1961. The company's commercial and passenger vehicles are already being marketed in several countries in Europe, Africa, the Middle East, South East Asia, South Asia and South America. It has franchisee/joint venture assembly operations in Kenya, Bangladesh, Ukraine, Russia, Senegal and South Africa.
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The foundation of the company's growth over the last 50 years is a deep understanding of economic stimuli and customer needs, and the ability to translate them into customer-desired offerings through leading edge R&D. With over 3,000 engineers and scientists, the company's Engineering Research Centre, established in 1966, has enabled pioneering technologies and products. The company today has R&D centers in Pune, Jamshedpur, Lucknow, Dharwad in India, and in South Korea, Spain, and the UK. It was Tata Motors, which developed the first indigenously developed Light Commercial Vehicle, India's first Sports Utility Vehicle and, in 1998, the Tata Indica, India's first fully indigenous passenger car. Within two years of launch, Tata Indica became India's largest selling car in its segment. In 2005, Tata Motors created a new segment by launching the Tata Ace, India's first indigenously developed mini-truck.
In January 2008, Tata Motors unveiled its People's Car, the Tata Nano, which India and the world have been looking forward to. The Tata Nano has been subsequently launched, as planned, in India in March 2009. A development, which signifies a first for the global automobile industry, the Nano brings the comfort and safety of a car within the reach of thousands of families. The standard version has been priced at Rs.100, 000 (excluding VAT and transportation cost).
Designed with a family in mind, it has a roomy passenger compartment with generous leg space and head room. It can comfortably seat four persons. Its mono-volume design will set a new benchmark among small cars. Its safety performance exceeds regulatory requirements in India. Its tailpipe emission performance too exceeds regulatory requirements. In terms of overall pollutants, it has a lower pollution level than two-wheelers being manufactured in India today. The lean design strategy has helped minimize weight, which helps maximize performance per unit of energy consumed and delivers high fuel efficiency. The high fuel efficiency also ensures that the car has low carbon dioxide emissions, thereby providing the twin benefits of an affordable transportation solution with a low carbon footprint.
In May 2009, Tata Motors introduced ushered in a new era in the Indian automobile industry, in keeping with its pioneering tradition, by unveiling its new range of world standard trucks called Prima. In their power, speed, carrying capacity, operating economy and trims, they will introduce new benchmarks in India and match the best in the world in performance at a lower life-cycle cost.
Tata Motors is equally focused on environment-friendly technologies in emissions and alternative fuels. . It has developed electric and hybrid vehicles both for personal and public transportation. It has also been implementing several environment-friendly technologies in manufacturing processes, significantly enhancing resource conservation
Through its subsidiaries, the company is engaged in engineering and automotive solutions, construction equipment manufacturing, automotive vehicle components manufacturing and supply chain activities, machine tools and factory automation solutions, high-precision tooling and plastic and electronic components for automotive and computer applications, and automotive retailing and service operations.
Tata Motors is committed to improving the quality of life of communities by working on four thrust areas – employability, education, health and environment. The activities touch the lives of more than a million citizens. The company's support on education and
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employability is focused on youth and women. They range from schools to technical education institutes to actual facilitation of income generation. In health, our intervention is in both preventive and curative health care. The goal of environment protection is achieved through tree plantation, conserving water and creating new water bodies and, last but not the least, by introducing appropriate technologies in our vehicles and operations for constantly enhancing environment care.
With the foundation of its rich heritage, Tata Motors today is etching a refulgent future.
HISTORY OF TATA MOTORS
The Company was incorporated on 1st September 1945 at Mumbai to manufacture diesel vehicles for commercial use, excavators, industrial shunter, dumpers, heavy forgings and machine tools. The commercial diesel vehicles which were known `Tata Mercedes Benz' (TMB) is now called `Tata' vehicles after the expiry of the collaboration agreement with Daimler-Benz AG, West Germany. The company also used to manufacture pulp and paper making machinery. In 1960 the company's name, which was Tata Locomotive & Engineering Company Ltd. was changed to Tata Engineering & Locomotive Company Ltd. In the year 1987 the company undertook to set up a new forge shop, a high output foundry line, a new paint shop as well as augmentation of engine and gearbox manufacturing facilities, all at Jamshedpur
In 1991 during the year the company entered into a collaborative agreement with an internationally renowned engine research and development organization to jointly develop higher horsepower, fuel efficient diesel and petrol engines to meet the future requirements of the company. The last quarter saw the company launching two new passenger vehicles, the SIERRA and the ESTATE totally designed and manufactured in India. The company acquired a BIFR company, M/s Noduron Founders Maharashtra Ltd. The total cost for Telco worked out to Rs.18 crores as against setting up of similar critical castings foundry. During the year company launched new earth moving equipment TWK-3036 Tata Front End Wheel Loader. Two new models in the EX series of hydraulic excavators were launched. A 10 tonne pick and carry articulated crane, designed and developed in-house was also introduced. During the year company entered into an agreement with Nachi-Fujikoshi Corporation, Japan to manufacture arc and spot welding robots suitable for automobile manufacturing applications. During the year, company undertook to set up a joint venture with Asian Glass Co. Ltd., Japan to manufacture float glass to be used as wind shields for automobiles. ACC along with Tata Exports Ltd. participated in the joint venture. The joint venture named as Floathlass India Ltd., the Company would have a stake of 16.33%. Tata Cummins Ltd., Mercedes-Benz (India) Ltd., Tata Holset Ltd., Tata Precision Industries, Singapore and Nita Company Ltd., are the joint Ventures of theCompany
Taking advantage of the broad banding policy announced by the Government of India, the Company entered into a collaboration agreement with Honda Motor Co. Ltd., Japan, for the manufacture of their `ACCORD' model of cars in India. On 22nd April, an agreement was entered into between Daimler-Benz AG and Mercedes Benz AG, Germany to setup a joint venture company Mercedez-Benz India to manufacture `E' class paneyer cans and engines in India.
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During the year 1995 a new double pick-up and Army Version of various Telco Vehicles were developed. A new petro engine and turbo diesel engine, an up-graded 709 LCV, new sports utility vehicle Safari expected to be launched shortly. A 25 tonne 6 X 2 truck and a bus with cummins engine were launched.
Tata Engineering and Locomotive Company (TELCO), has acquired a second hand paint shop, machine line and cylinders from the Australian unit of the Japanese auto giant, Nissan. TELCO is believed to have picked up the unit for Rs. 70 crore. The total cost of import duty would be Rs 100 crore. During the year a machine tool division was expanded so as to double its machine building capacity and significantly reduce production times.
The Company has launched "TATA SAFARI" in its Multi utility vehicle segment. Tata Holset's turbo charger plant inaugurated on November 25, 1996.
In 1997, the Tata Engineering and Locomotive Company Ltd. (TELCO) have emerged as numerous uno in the Review 200 survey conducted by the Far Eastern Economic Review in association with Citi Bank. The Company introduced a 9-tonne vehicle which was well received in the market. A 40 tonne tractor trailer powered by a Tata Cummins Engineering was introduced. The Company developed a low floor bus chassis to meet the specific needs of urban transport. The Company signed a new agreement with Hitachi for manufacture of upgraded versions of existing range of excavators.
The year 1998- Tata Engineering and Locomotive Company Ltd (Telco) announced a tie-up with Tata Finance Ltd and ANZ Grindlays Banks as the official financiers for its small car "Indica" to be launched in December. Tata Engineering Locomotive Company Ltd (Telco) sold its construction equipment business into a new subsidiary company, Telco Construction Equipment Company Ltd. The Company in its small car segment has launched "Tata Indica" which evoked an overwhelming response in the Indian market. A new range of cummins engine powered vehicle which include a 35 tonne and a 40 tonne articulated truck and two variants of buses.
To make substantial improvement in the quality of bus bodies available with TATA vehicles, the Company encouraged collaboration between Fuji Heavy Industries of Japan and the Automobile Corporation of Goa. The new project undertakes production of bodies on TATA chassis, conforming to the most exacting international standards. Concorde Motors Ltd., a Joint Venture between Tata Engineering and Jardine International Motors (Mauritius) Ltd. was appointed as dealer for the Company's passenger cars in several cities across the country, in Feb 1998.
The year 1999-Telco became the first Indian manufacturer to offer commercial vehicles meeting euro-I emission norms, a year before they are due to be introduced in the country. It is proposed to make TCECL a one-stop shop for construction equipment and earthmoving machinery. In Oct 1999, the Company won the National award for R&D Efforts in Development of Indigenous Technology in the Mechanical Engineering Industries Sector instituted by Department of Scientific and Industrial Research, Ministry of Science and Technology for the year 1999. SKF Bearings India Ltd has signed an agreement with Telco to supply hub bearings for its latest model
2000 saw the Company working towards introducing two new petrol-driven variants of its small car Indica, powered by a multi-point fuel injection engine. The Company
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launched the Indica 2000, the Euro II Complaint, 75 BHP multi-point fuel injection (MPFI) version of Indica. The Company has won the National Technology Award for indigenous development and commercialization of the Tata Indica car. The Company has launched its new hi-tech Indica 2000 car with MPFI petro engine in Guwahati.
Tata Engineering & Locomotive Co. is renamed as Tata Engineering Ltd. It replaced its three-shift production line with a one-shift daily schedule starting from 26th June. In the same year FICCI-SEDF- Business world-Compaq award for social responsiveness was awarded to the company. The Central Pollution Control Board for Environmental Technology award has been presented to Tata Engineering in recognition of its contribution towards efforts to conserve the environment. TATA Engineering on September 10 announced the addition of MPFI petrol version to the Indica V2 range.
In year 2002 Foreign Institutional Investors (FII) hike stake in the company to 13.34% launches six new products in light, medium and heavy vehicles segments on Jan 15 during Auto Expo. Announces financial restructuring. Displays its Tata Sedan car at the Geneva Motor Show. Indica adjudged top selling B-segment car in 2002.Launches two new motorsport cars (The Zero and Double Zero Pace cars). High Court Approves Tata Engineering's Financial Restructuring. Tata Engg, BPCL tie up to market co-branded lubricants.Tata Steel's investment in Tata Engineering has been hiked to Rs 117.98 crore over the last year. Telco names Sedan as Tata Indigo.Unveils 'EX' series of medium and heavy commercial vehicles. Indica sales cross two-lakh mark .Collaborates with Nippon-Arcelor for technical knowhow on CR steel. Receives Teri's (The Energy and Resources Institute) CoRE-BCSD (Corporate roundtable on development of strategies for sustainable development and environment-business council for sustainable development) corporate social responsibility (CSR) awards for '01-02. Unleashes Safari's petrol version; priced at Rs 9.35 lakh.
The year 2003- Tata Unveils CityRover .Tata Motors Ltd signed a binding Memorandum of Understanding (MoU) with Deawoo Commercial Vehicle Company Ltd (DWCV), Korea for the acquisition of this company. It introduces Tata SFC 407 EX Turbo Light Commercial Vehicle (LCV). The Company changed from 'TELCO ' to 'TATAMOTORS' w.e.f December 24, 2003. In the same year Tata Safari ranks No 1 in MUV/SUV segment.
2004:- The year of glory. Tata Motors launch an upgraded version Indica on January 15, 2004, in a bid to shore up sales of the small car.
Auto Expo: Tata unveils new version of Indica. Tata Motors unveils Indica V2. Tata Motors launches new Indica V2 in Kerala. Tata Motors introduces new 'Indicab' for tour operators. The much hyped Rs one lakh passenger car project of Tata Motors was going ahead as planned. Tata Motors enters agreement with Ukraine bus building firm. Tata Motors enters into agreement with Etalon. In a move to consolidate its presence in the light commercial vehicles segment, Tata Motors has launched a new variant of its 407 series with increased pay load capacity called SFC 407EX. Tata Motors buys Daewoo truck unit for Rs 465 crore. Tata Motors unveils Tata SFC 407 EX. Tata Motors inks agreement with Austrian, French companies. Acquires Daewoo Commercial Vehicle Company Ltd (DWCV), Korea. Tata Motors launches most anticipated new 6-tn truck in India.
Tata Motors, the country's largest commercial vehicles manufacturer unveiled the new LPT 909EX Turbo Truck in Tamil Nadu. Tata Motors and Tata Africa unveiled a range of
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passenger cars, utility vehicles, pick-ups, trucks and buses for the South African market. Tata Motors has launched a face lifted version of its multiutility vehicle, Tata Sumo. Tata motors rolls out Tata SFC 407EX BS II turbo light commercial vehicle.
Tata Motors unveils Tata Safari DICOR in Kerala market on August 11, 2005. Tata Motors rolls out 2 luxury variants of Indigo. Tata Motors unveiled new Indica V2 Turbo with a price tag of Rs 4.10 lakh for DLG variant and Rs 4.31 lakh for DLX. Tata Motors ropes in CVTech to make parts for its small car. Tata Daewoo inks pact with Pakistan co.
Tata Motors has been presented the Golden Peacock Global Award for Corporate Social Responsibility (CSR) in the Large Business category by the Institute of Directors in 2007. Tata Motors buys Nissan facility in S. Africa. Tata Motors has got a prestigious order from the Delhi Transport Corporation (DTC) for 500 non-AC, CNG-propelled buses. Tata Motors Ltd has appointed Mr. P M Telang as Executive Director (Commercial Vehicles).
PRODUCT RANGE
Tata Motors' product range covers :-1. Passenger cars and utility vehicles: TATA SUMO GRANDE
Global Operations & SubsidiariesTata Motors is pursuing growth internationally through exports and acquisitions. It
has a joint venture with Marcopolo, the Brazil-based maker of bus and coach bodies. It has also entered into a joint venture with Thonburi Automotive Assembly Plant Company of Thailand to manufacture and market the company's pickup vehicles in Thailand. Tata Motors and Fiat Auto have entered into an agreement for a Tata license to build a commercial vehicle at Fiat's facilities in Córdoba, Argentina.
The company has made substantial investments in building a network of associate and subsidiary companies and joint ventures that complement and support its business activities. These include:
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Tata Daewoo Commercial Vehicle Company is a 100 per cent subsidiary of Tata Motors in the business of heavy commercial vehicles. It is South Korea's second largest truck maker and the largest exporter of heavy trucks.
Telco Construction Equipment Company makes construction equipment and offers allied services. Tata Motors has a 60 per cent holding; the rest is held by Hitachi Construction Machinery Company, Japan.
Tata Technologies provides specialized engineering and design services, product lifecycle management and product-centric information technology services. It has two operating companies, INCAT and Tata Technologies EKS.
Tata Cummins manufactures high horsepower engines used in the company's range of commercial vehicles.
HV Transmissions and HV Axles are 100 per cent subsidiaries that make gearboxes and axles for heavy and medium commercial vehicles.
TAL Manufacturing Solutions is a 100 per cent subsidiary that provides factory automation solutions and designs and manufactures a wide range of machine tools.
Tata Motors European Technical Centre is a UK-based 100 per cent subsidiary engaged in design engineering and development of products.
TML Financial Services is a 100 per cent subsidiary in the business of financing customers and channel partners of Tata Motors.
Hispano Carrocera is a reputed Spanish bus manufacturing company in which the company has acquired a 21 per cent stake.
Tata Auto Comp Systems (TACO) is a holding company for promoting domestic and foreign joint ventures in auto components and systems. It is also engaged in engineering services, supply chain management and after-market operations for the auto industry.
Concorde Motors is a 100 per cent subsidiary that retails Tata Motors' range of passenger vehicles
COMPETITORS
Mahindra & Mahindra Ltd.Mahindra & Mahindra (M&M) was first known for assembly of the iconic Jeep in
India and is part of the US $6.7 billion Mahindra Group, an automotive, farm equipment, financial services, trade and logistics, automotive components, after-market, IT and infrastructure conglomerate. The company was set up in 1945 as Mahindra & Mahindra. The company later branched out into manufacture of light commercial vehicles (LCVs) and agricultural tractors agricultural tractors, rapidly growing from being a manufacturer of army vehicles and tractors to an automobile major with a growing global market. At present, M&M is the leader in the utility vehicle (UV) segment in India with its flagship UV, the Scorpio.
It had done a joint venture with ITEC, North American leader in heavy trucks. M&M has formed a 51:49 JV called Mahindra International with ITEC, USA (parent Navistar International), to manufacture commercial vehicles and to bolster its position in the CV business. ITEC is the leader in medium and heavy trucks and buses in North America, and is the world's largest manufacturer of medium-duty diesel engines. Mahindra International aims to have a presence across the CV market (6-35 tones GVW) with variants of passenger transport, cargo and specialized load applications and is likely to start producing medium/heavy commercial vehicles from 2009.
Ashok Leyland Ltd.
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The company was established in 1948 as Ashok Motors, with an aim to assemble Austin cars. Manufacturing of commercial vehicles was started in 1955 with equity contribution from Leyland Motors. Today the Company is the flagship of the Hinduja Group, a British-based and Indian originated transnational conglomerate.
Acquisition of Czech Republic-based Avia. Ashok Leyland (ALL) recently acquired the truck unit of Czech Republic-based Avia for US$35m. Avia manufactures 6-9 tonne LCVs and has a capacity of 20,000 units per annum. The acquisition has given ALL direct access to an entire range of Avia trucks, Avia’s press shop with dies and tools, welding lines, state-of-the-art paint shop and R&D facilities. ALL has also entered into technology agreements with Hino Motors of Japan and ZF of Germany to complement its in-house R&D efforts and developing complementary components and aggregates.
Force MotorsJoint Venture with MAN for manufacturing high-tonnage vehicles Force Motors has
paired up with MAN in a 70:30 JV to manufacture high-tonnage and specialty vehicles, such as long-haul trucks, tippers, tractor trailers and multi-axle vehicles in the 16-32 ton range at its Pithampur plant, with an initial capacity of 24,000 units per annum and at an investment of Rs7bn. The JV plans to sell nearly half of its production in the domestic market, while the rest is to be exported to the Middle East, Turkey, Russia, Asia and Africa. Further, the two companies have formed another JV to manufacture buses in India from end-2007.
Hyundai MotorsThe Hyundai Motor Company, a division of the Hyundai Kia Automotive Group, is
South Korea’s largest and the world’s fifth largest automaker in terms of units sold per year. Headquartered in Seoul, Hyundai operates the world’s largest integrated automobile manufacturing facility in Ulsan, which is capable of producing 1.6 million units annually. The Hyundai logo, a slanted, stylized 'H', is said to be symbolic of two people (the company and customer) shaking hands. Hyundai means "modernity" in Korean.
Maruti Suzuki India Ltd.Maruti Suzuki India Limited is a publicly listed automaker. It is a leading four-
wheeler automobile manufacturer in South Asia. Suzuki Motor Corporation of Japan holds a majority stake in the company. It was the first company in India to mass-produce and sell more than a million cars. It is largely credited for having brought in an automobile revolution to India. It is the market leader in India. On 17 September 2007, Maruti Udyog was renamed to Maruti Suzuki India Limited. The company's headquarters remain in Gurgaon, near Delhi.Maruti Udyog Limited (MUL) was established in February 1981, though the actual production commenced in 1983. Through 2004, Maruti has produced over 5 Million vehicles.
STRATEGIES FOR COMMERCIAL VEHICLE
“Ever since 2000 - when Tata Motors made a hefty Rs 500 crore (Rs 5 billion) loss in its worst financial performance - the company has been looking at ways to overcome cyclical ups and downs.”
The company chalked out a two-pronged strategy. The first was the classical route of trying to balance sales in different markets. Through an overseas push, Tata Motors felt this could be done. If there was a downturn in one market, an upturn in another could help it tide
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over fluctuating market situations. The acquisition of Daewoo's commercial vehicles business in March 2004 was a step in that direction.
The second part of the strategy was to add to its portfolio, products that would largely be immune to industry fluctuations. One way out: make vehicles that were smaller. Buyers of small and light commercial vehicles are largely individuals. The 207 DI (small commercial vehicle two-tonner) launched in August 2002, which had a Tata Mobile chassis and the successful Tata 407's engine, was one such instance.
The Ace was another part in this product strategy. However, industry analysts say that developing the one-tonne Ace was a tougher task in many ways than the 207 DI.
The challenges were both internal and external. One was to have the entire management team on the same wavelength on various operational and developmental issues.
Right costing was another challenge. The vehicle had to be built to a pre-determined price band, that too at a certain quality standard. If potential buyers were individuals who would otherwise opt for a three-wheeler, they had to be given a vehicle that would look and perform better. In this quest, the vehicle cabin incorporated car-like features to stand out in a crowd of rudimentary three wheelers.
Partly to keep costs under control, the company also banked on outsourcing. Today, a significant 82 per cent of the Tata Ace is outsourced. Even some of the design elements were focused on costs. It also paid attention to safety features. For instance, the rearview mirror was mounted on the windscreen glass instead of the roof of the vehicle.
The logic: the windscreen of a vehicle has the lowest vibration, so the rearview for the driver will be perfect. It is trying to add value for customers in other ways too. The company recently introduced a range of Ace accessories like a vehicle protection system, music systems and even Ganesha idols.
Customer gains
The company also did a market segmentation analysis to understand potential customers better. There were primarily two sets of customers: entry-cost sensitive customers and others who valued return-on-investment.
The company decided to focus on the ROI-sensitive customer who would be willing to pay a slightly higher price, but would require lower operating costs.
Tata Motors also had to address a key concern of commercial vehicle buyers - lead (time taken to travel a distance) and load (weight it could take). Hence, the Ace was built to achieve top speeds of 64 kmph compared to 50-56 kmph in the case of three-wheelers.
From the customer’s point of view, it could mean more trips on any given day. In terms of load bearing capacity, the cargo bed of the Ace was bigger at 2,200X1,500 mm, compared to an average of 1,950X1,450 mm of other three-wheelers.
There were other benefits, too. In running costs, the company claims that Ace requires an oil change only after every 9,000 kilometers of driving, compared to 2,500-5,000 kilometers in the case of three-wheelers. Savings: Rs 1,000-Rs 1,500.
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“Reach for the stars”
Before the launch of Ace, Tata Motors had to pay attention to one important aspect that they are not going into the market with the mindset of selling a medium and heavy commercial vehicle. For instance, medium and heavy commercial vehicles typically cover hundreds of kilometers at a stretch - even the 207 DI travels an average distance of more than 200 kilometers a day.
Not so for the Ace. The operators of the vehicle travel for a shorter distance as it is primarily used for last mile transport between the outskirts of a city to the centre (60-100 kilometers). One fallout: it would be too much to expect owners to drive a longer distance to get to an after-sales outlet.
So, while focusing on maximum reach it tried to benchmark itself broadly with motorcycles. Typically, motorcycle manufacturers have a sales or service outlet every 10-20 kilometers. That scale of reach was not required for selling the Ace.
Nevertheless, Tata Motors had to augment distribution. To increase the number of service outlets, the company trained automobile garages and branded them Tata-certified service points.
At present, the company claims to have a sale or authorized service station at every 50-70 kilometers in the states where the Ace is sold.
Now, Tata Motors was ready for the acid test in choosing its entry and market strategy. One choice was to follow a tried and successful route taken by the 207 DI during launch. The 207 DI made its foray in a smaller market such as the north-east.
At that time, this region was out of market leader, Mahindra & Mahindra’s radar and through this deliberates strategy, Tata Motors managed to create a market for pick-ups in that region.
But this time, Tata Motors took the battle straight to the enemy camp. With an aggressive pricing strategy, it launched the Ace in Tamil Nadu, Kerala, Karnataka, Andhra Pradesh and Maharashtra - 70 per cent of three- wheeler sales happen in these five states.
At a value price point of Rs 220,000, the Ace was targeted to attract buyers who would otherwise buy three-wheelers at price points from Rs 120,000-Rs 190,000.
Clearly, if the price and product were in place, positioning could not afford to be behind. But the advertising was careful that it did not hype-up the looks of the Ace.
GLOBAL STRATEGIESThe Tata Motors is one of the world’s largest manufacturers of commercial vehicles
apart from being India’s largest passenger automobile and commercial vehicle. The OICA ranked it as the world’s 20th largest automaker, based on figures for 2006.
Tata motors from being present as an exporter in 70 countries, the company today focuses on 15 -20 key countries where it will have a significant presence in terms of volumes and market share. Apart from this the company has expanded its production and assembly
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operations to several other countries including South Korea, Thailand, South Africa and Argentina and is planning to set up plants in Turkey Indonesia and Eastern Europe.
In internationalization the company’s first step was to align the international business to the two business units — the Passenger Car Business Unit (PCBU) and the Commercial Vehicle Business Unit (CVBU), to bring greater focus and increased synergy between the domestic and international operations. Tata motors feel that the international business needs to be looked at from a perspective that goes beyond volumes and presence in many countries. According to Dr V. Sumantran, executive director, PCBU, the company has now embarked on a road where exports are made an integral part of business and they do not think of sales outside the country as a separate activity but integrated within the mission of each of its businesses. According to Mr. Ravi Kant, executive director, CVBU in a cyclical business such as one of their, it is important that they hedge against cyclicality and international business offers an opportunity as different countries go through peaks and troughs in demand at different points in times and hence capacity utilization is more effective and risks of downturns can be mitigated.
Tata motors as part of their business strategy to make an entry in new and yet uncharted markets entered the market of China and the CIS countries. Besides the assembly plants that Tata Motors has in Bangladesh and Malaysia, the company’s recent order for 500 buses from Senegal will involve providing technical and commercial assistance to the Senegalese government for setting up a bus body building plant. Tata Motors has been short-listed for South Africa’s "Taxi Project" in which the government will provide an entirely new transport system in that country. A joint venture project for bus body building in Ukraine and serious due diligence into the opportunities available in the Chinese market are other areas where Tata Motors is looking to create new opportunities. In addition, inorganic growth through acquisitions also quickens the process of internationalization of the company. In 2004, it acquired the Daewoo Commercial Vehicle Company of South Korea.
The reasons behind the acquisition were: Company’s global plans to reduce domestic exposure. The domestic commercial
vehicle market is highly cyclical in nature and prone to fluctuations in the domestic economy. Tata Motors has a high domestic exposure of ~94% in the MHCV segment and ~84% in the light commercial vehicle (LCV) segment. Since the domestic commercial vehicle sales of the company are at the mercy of the structural economic factors, it is increasingly looking at the international markets. The company plans to diversify into various markets across the world in both MHCV as well as LCV segments.
To expand the product portfolio Tata Motors recently introduced the 25MT GVW Tata Novus from Daewoo’s (South Korea) (TDCV) platform. Tata plans to leverage on the strong presence of TDCV in the heavy-tonnage range and introduce products in India at an appropriate time. This was mainly to cater to the international market and also to cater to the domestic market where a major improvement in the Road infrastructure was done through the National Highway Development Project
The synergies were significant – a presence in the 250 to 400 HP ranges of trucks is what the Korean company brings to the table. This complements the existing product range of Tata Motors which delivers vehicles up to 210 HP. In March 2005, it acquired a 21% stake in Hispano Carrocera SA, giving it controlling rights in the company. Tata Motors has also formed a 51:49 joint venture with Marcopolo S.A., a Brazil-based global leader in bus body building. This joint venture is to manufacture and assemble fully-built buses and coaches targeted at developing mass rapid transportation
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systems. The joint venture will absorb technology and expertise in chassis and aggregates from Tata Motors, and Marcopolo will provide know-how in processes and systems for bodybuilding and bus body design. On March 26, 2008 Tata Motors agreed to purchase Jaguar Cars and Land Rover from Ford Motor in a deal worth $2.3bn (£1.15bn). Tata Motors has also acquired from Ford the rights to three other brand names: Daimler, Lanchester and Rover. The possible reasons behind the acquisition are:
These are the marquee brands and the legacy of both the Land Rover and Jaguar are well recognized badges in the up market SUV (sports utility vehicle) and luxury car segments respectively fuels the Tata motors global aspirations. This buy out establishes its global footprints as a company with premium brands. Also the company now can compete with giants like BMW, Mercedes and Audi.
This acquisition also gives Tata motors to access to a readymade product pipelines and technology. Developing a car from the scratch could otherwise take the company anywhere between two and five years.
The technology that propels the top-end cars is changing according to auto experts and the hybrid technology will take over the luxury cars in a decade. Post the takeover the Tata’s won’t be left over with obsolete technology as the ford’s existing technology will fill the need gap for Tata’s in the interim.
Innovation, knowledge, commitment and pride are the Tata Motors greatest asset.
STRATEGIES BY COMPETITORSAshok Leyland Ltd
Ashok Leyland Ltd (ALL) has entered into a tripartite arrangement with TVS Coaches and a European company, Irizar, to manufacture bus-bodies for tourist and luxury vehicles.
Iveco, the Commercial Vehicle entity of Fiat and Hinduja Group who together hold 51% shareholding in India’s Ashok Leyland and 59% in Ennore Foundries have concluded a new Agreement to significantly enlarge the cooperation between Ashok Leyland and Iveco
The enlarged cooperation between Iveco and Ashok Leyland is a major step in Ashok Leyland strategy of global profitable growth.
Ashok Leyland has signed an agreement with Japanese Nissan Motor Company for three joint venture companies to develop, manufacture and market light commercial vehicles (LCVs), powertrains and technical development. The joint venture companies will cover the following business areas:
Vehicle manufacturing company - a company with exclusive rights to manufacture LCV products in India for both the partners.Powertrain manufacturing company - responsible for the manufacture and assembly of engines and other drivetrain components to be fitted in the LCV products and for exports. Manufacturing will be located in IndiaTechnology development company - responsible for the development of LCV products and related powertrains. The company will be owned 50:50 by the two partners.
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Ashok leyland plans to foray into the utility vehicles segment with both military and civil models. Ashok Leyland has indigenously developed a new four-wheeler light specialist vehicle (LSV). Ashok Leyland’s LSV is a Humvee-type vehicle and the company will offer a prototype to the Indian army for field trials soon.
Commercial vehicles manufacturer Ashok Leyland is planning to enter the luxury bus market with the launch of its top end vehicle `InterCentury Luxura' by the second quarter of the next fiscal.
Mahindra & Mahindra Ltd
A wholly owned affiliate of Navistar International Corporation (Other OTC: NAVZ),signed a joint venture agreement with Mahindra & Mahindra Ltd. of India to produce diesel engines for medium and heavy commercial trucks and buses in India.
Mahindra, which was defeated in a bidding contest by rival Tata for Jaguar and Land Rover, has partnered with Atlanta-based Global Vehicles USA, which will distribute the vehicles, establish marketing plans and manage a network of hundreds of dealers that have signed up to sell Mahindras throughout the U.S.
Mahindra & Mahindra will set up a world class plant in Maharashtra to manufacture commercial trucks through its joint venture with US-based truck major International Truck and Engine Corp. This JV will produce medium & heavy commercial vehicles which would be designed and developed with in-house capabilities.
The venture will leverage M&M's distribution network to rapidly launch a full range of M&HCV based, in part, on ITEC's existing product line and adapted for the Indian market.
M&M is looking to export 20 per cent of its total produce which could be roughly at 40,000-50,000 vehicles per annum. The company is looking to become a major export player. The vehicles will be designed and developed with in-house capabilities.
INDUSTRY PROFILE
One of the major global automotive industries in the coming years. A number of domestic companies produce automobiles in India and the growing presence of multinational investment, too, has led to an increase in overall growth. Following the economic reforms of 1991 the Indian automotive industry has demonstrated sustained growth as a result of increased competitiveness and relaxed restrictions. The monthly sales of passenger cars in India exceed 100,000 units
History
In 1953, the government of India and the Indian private sector initiated manufacturing processes to help develop the automobile industry, which had emerged by the 1940s in a nascent form. Between 1970 to the economic liberalization of 1991, the automobile industry continued to grow at aslow pace due to the many government restrictions. A number of Indian manufactures appeared between 1970-1980. A number of foreign firms initiated joint ventures with Indian companies.
Timeline of Indian automobile industry:
• 1897 First Person to own a car in India - Mr. Foster of M/s Crompton Greaves Company, Mumbai
• 1901 First Indian to own a car in India - Jamshedji Tata • 1905 First Woman to drive a car in India - Mrs. Suzanne RD Tata • 1905 Fiat Motors • 1911 First Taxi in India • 1924 Formation of traffic police • 1928 Chevrolet Motors • 1942 Hindustan Motors • 1944 Premier Auto Limited • 1945 Tata Motors • 1947 Mahindra Motors • 1948 Ashok Motors • 1948 Standard Motors • 1974 Sipani Motors • 1981 Maruti Udyog • 1994 Rover Motors • 1994 Mercedes Benz • 1994 Opel • 1995 Ford Motors • 1995 Honda SIEL • 1995 Reva Electric Car Company • 1995 Daewoo Motors • 1996 Hyundai Motors • 1997 Toyota Kirloskar Motors • 1997 Fiat Motors (Re-Entry) • 1998 San Motors • 1998 Mitsubishi Motors • 2001 Skoda Auto • 2003 Chevrolet Motors (Re-Entry)
Following the economic reforms of 1991, the automobile section underwent delicensing and opened up for 100 percent Foreign Direct Investment. As urge in economic growth rate and purchasing power led to growth in the Indian automobile industry, which grew at a rate of 17% on an average since the economic reforms of 1991. Increased presence of multiple automobile manufacturers has led to market competitiveness and availability of options at competitive costs. India was one of the largest manufacturers of tractors in the world in 2005-06, when it produced 2,93,000/- units. India is also largely self-sufficient in tyre production, which it also exports to over 60 other countries.
The following are some of the notable Indian automobile manufacturers:
Company Description Product
Ashok Leyland
Ashok Leyland is a commercial vehicle manufacturing company based in Chennai, India. In 1948, Ashok Motors was set up in what was then Madras, for the assembly of Austin Cars. The Company's name changed soon with
18 seater to 82 seater double-decker buses, 7.5 tonne to 49 tonne in haulage vehicles, special application vehicles, and diesel engines for industrial, marine and genset applications.
equity participation by British Leyland and Ashok Leyland commenced manufacture of commercial vehicles in 1955. Ashok Leyland has six manufacturing plants: a plant at Ennore near Chennai, two plants at Hosur (called Hosur I and Hosur II, along with a press shop), and the assembly plants at Alwar and Bhandara.
Force Motors Ltd
Force Motors, formerly Bajaj Tempo, is a Pune-based manufacturer of a number of commercial vehicles
Gas-cylinder carrier, copied from 3-wheel Vidal & Sohn Tempo-Werke (German) Hanseat; Matador, a version of Hanomag van and light-truck (1.5 tonne payload); Tempo-traveller, Indian version of Daimler-Benz T-1 transporters; Man-Force Trucks, licensed version of MAN AG trucks; and UV's copied from Daimler-Benz.
Hindustan Motors
Hindustan Motors is one of the oldest Indian car manufacturers in India. It is perhaps best known for the Ambassador which has remained virtually unchanged for about 30 years. It is still very popular as a taxi and is widely used by Indian politicians.
Trekker (discontinued), Land master
(discontinued), Contessa (discontinued)—5th generation Vauxhall Victor, and the Ambassador—a version of the 1950s Morris Oxford.
Mahindra & Mahindra Limited
The automotive section of Mahindra started off when a first batch of seventy five Utility Vehicles (UVs) was imported in CKD condition from Willys in 1947. It presently manufactures Jeeps along with agricultural equipment and light trucks.
Armada (discontinued), Voyager
(discontinued), Bolero. Commander, CL, MaXX, Scorpio, and Mahindra and
Mahindra Classic.
Maruti Suzuki
Maruti Suzuki (formerly Maruti Udyog) was formed as a partnership between the Government of India and Suzuki of Japan. It brought India its first "affordable" car, the Maruti 800. It is the biggest car manufacturer in India and especially dominant in the small car sector. Then it brought out the
800, Omni, Alto, Gypsy, Swift, SX4, WagonR, Versa, Zen Estilo, Grand Vitara, and Swift Dzire.
Maruti 1000, made by Maruti Udyog was the first ever contemporary sedan-type car launched in India. The car (which Suzuki sold in other countries as the Cultus/Swift/Geo Metro with a 1.3 L or 1.6 L engine) was introduced in October, 1990. Sold at Rs.3.81 lakh, it was back then the costliest car released in the Indian market. Then the company replaced it with Esteem and from those days on a line of Suzuki cars rolled out in the Indian market.
Premier Automobiles
Walchand Hirachand started Premier Automobiles Ltd. (PAL) in 1942. They assembled De Soto and Plymouth cars in 1946 in association with Chrysler from the United States. They also manufactured the Premier Padmini which was a version of the Fiat 1100.
Padmini (discontinued), 118 NE
(discontinued), and Premier Sigma.
REVA
REVA Electric Car Co. is the producer of the Reva (G-Wiz), an electric car intended for use as a City car. More REVAs have been produced than any other currently selling electric car and sales are increasing. It is currently the world's leading electric car manufacturing company.
REVA (G-Wiz).
Tata Motors
Tata Motors, formerly known as TELCO, is the largest automobile manufacturer in India and commands more than 70% of the commercial vehicle market in India and has also increased its share of passenger vehicle market. It was responsible for developing India's first indigenous vehicle, the Indica. It has proved to be a success in the market after initial quality problems. The company also exports the car to many countries. Tata owns major stake in Jaguar and Range Rover.
Indica, Indigo, Indigo Marina, Safari, Sumo, TL, and Tata Nano.
Some of the multinational companies in India are:-
Company Description Product
Audi
In January 2008, Audi started production with the Audi A4 and A6 at its factory in Aurangabad in the state of Maharashtra.
A4, A6, A8, R8, Q7, and TT.
BMW
BMW is a manufacturer of sport sedans. BMW enjoys good brand recognition in India. It has set up a plant in Chennai, Tamil Nadu, to manufacture cars locally exclusively for the local market with no plans for export. It set up the plant to circumvent high import duties.
The Fiat Uno was one of the first products to be introduced. The Fiat Palio was later introduced and was initially a success with its style and ride comfort coupled with solid build but has slowly lost its sheen due to low fuel efficiency. Other models were introduced such as the Palio Weekend and Siena. Fiat tried re-branding of the Fiat Siena to Fiat Petra without much success. It roped in Sachin Tendulkar as one of its brand ambassadors. Even Michael Schumacher appeared in an ad for the Palio. It has entered now into an alliance with Tata Motors to jointly manufacture cars at its plant in Ranjangaon, near Pune. The facility will enable the two companies to make about 200,000 cars per annum, and also house an engine manufacturing unit with a capacity of 250,000 units per annum. The alliance will also see Tata Motors use Fiat's diesel technology the 1.3 litre multijet diesel engine for its own vehicles.
Uno (discontinued), Palio, Palio Stile, Siena (discontinued), Siena Weekend
(discontinued), Petra (discontinued), Adventure, Fiat Bravo—sold in collaboration with Tata Motors, Fiat 500—sold in collaboration with Tata Motors, and Fiat Linea—sold in collaboration with Tata Motors.
Ford entered India in collaboration with Mahindra & Mahindra in 1995 with a plant in Tamil Nadu. The first model was the Escort.
Escort (discontinued), Ikon, Mondeo (discontinued), Endeavour, Fusion, and Fiesta.
General Motors
Chevrolet has been a recognized brand in India for several decades. The model line-up consists of vehicles from cheaper sister brands like Daewoo. General Motors initially entered India with the Opel brand, but the Opel brand was dropped in March 2006 because sales were at an all time low due to high prices and General Motors wanted to focus more on their Chevrolet brand. Since the Chevrolet brand was introduced in India, there have been no new Opel products. GM's Indian operations were originally a JV between Hindustan Motors and GM, with most of GM's vehicles assembled at Hindustan's plant in Halol, Gujarat. Since then, GM India is now wholly owned by GM.
Tavera—rebadged Isuzu Panther, Forester (discontinued)—rebadged First Generation Subaru Forester, Aveo—second Generation Daewoo Kalos sedan, Aveo UV-A—first Generation Daewoo Kalos hatchback, Optra—rebadged Daewoo Lacetti, SRV—rebadged Daewoo Lacetti, Spark—formerly Daewoo Matiz in India, and Captiva—recent launch in India.
Honda
Honda Siel Cars entered India in 1995. It sells 4 cars in India—the City, Civic, Accord, and CR-V. The manufacturing plant of Honda Siel is located in Greater Noida. The model of Accord sold in India is the 2003 model. The most inexpensive car from Honda—The City. The most expensive—The Honda Accord V6.
Accord, City, Civic, and CR-V.
Hyundai
When Hyundai entered India, the brand was virtually unknown in the Indian market. But now Hyundai has good market because of its models like SANTRO, Accent etc.
Santo—second generation Hyundai Atos, Accent—second generation Hyundai Accent sedan, Sonata—sold as the Sonata Embera, Verna—third generation Hyundai Accent sedan, Getz—sold as the Getz Prime, Elantra—3rd generation Hyundai Elantra sedan, Terracan (discontinued), Tucson, i10—brand new small car, global launch in India in 2007, and i20.
-Logan (in partnership with Mahindra and Mahindra).
Mercedes-Benz
Mercedes-Benz has had to cater to the ever gowning luxury segment in India, especially after the arrival of the other luxury German manufacturers. Now, Mercedes-Benz cars are launched in India soon after the worldwide launch and homologation as opposed to earlier, when Mercedes-Benz had monopolized the niche Indian market. In 2007 they launched the SLK-Class and CLS-Class.
Škoda Auto is an important car manufacturer of India. It recently launched the Laura; the Octavia still continues to exist. Škoda also offers the Superb in India but it's not too popular.
Octavia, Superb, Laura, and Fabia.
Toyota
Toyota Kirloskar sells 4 car models in India. It stopped producing the Toyota Qualis to make way for the Toyota Innova, which was launched in India in 2005. The most expensive car from Toyota is the Land Cruiser Prado.
Qualis (discontinued)—3rd generation Toyota Kijang, Camry—7th generation Toyota Camry (the latest generation Camry), Corolla—9th generation Toyota Corolla, Innova, and Land Cruiser Prado VX—latest generation Toyota Land Cruiser (PRADO).
Anything offered to a market for attention, acquisition, use, or consumption that might satisfy a need or want. Product provides the functional requirements sought by consumers.
Product
Is a bundle of satisfaction that a customer buys. Almost always a combination of tangible and intangible benefits
A product may be new to the company, but not to the customers and in reverse a product may be new to the customers but not to the company.
NEW PRODUCT DEVELOPMENT PROCESS:
IDEA GENERATION IDEA SCREENING CONCEPT TESTING MARKETING STRATEGY DEVELOPMENT BUSINESS ANALYSIS PRODUCT DEVELOPMENT TEST MARKETING COMMERCIALISATION / LUNCING
The product TATA WINGER CARGO on which the research was being conducted is now at the commercialization stage of the new product development process. The various features of the product are:-
VARIABLES SUB CATEGORY FEATURES
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Emission BS III
Engine Capacity 1948 cc
Power 90 hp at 4300 rpm
Torque 190 Nm at 2000-3000rpm
Fuel Diesel
Driveline Clutch Friction plate 215mm
Gear box 5 forward and 1 reverse
Axle FWD
Steering/Brakes Steering Power assisted rack and
pinion
Turning radius 6.4 m
Front brakes Disc with twin pot caliper
Rare brakes Drum with LSPV
Service brakes hydraulic,dual
circuit,vacuum assisted
Suspension Front McPherson strut with coil
spring
Rear
Double parabolic leaf spring with hydraulic telescopic shock absorber
Dimensions Wheel base 3200 mm
Overall width 1905 mm
Overall length 4920 mm
Overall height 2445 mm
Overhang front 940 mm
Overhang rear 780 mm
Track front 1560 mm
Track rear 1526 mm
Min ground clearance 165 mm
Cargo area volume 7.8 cu.m
Cargo box
dimension(LxWxH)mm 2755x1650x1900
Approach angle 19o
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Departure angle 17o
Weights Gross Vehicle weight 2850 kgs
Pay load 1200 kgs
Misc Tire 185 R 14 LT, 8 PR
Fuel tank 60 L
Mileage 10.5 kmpl
Some of the benefits of the product are:- Monocoque body Large Cargo area. High power to weight ratio BS III engine for an eco-friendly drive Safe drive Driving comfort Good suspensions to handle fragile goods Car like passenger comfort Stylish next generation looks Low ground clearance for easy loading and unloading Best value for money
PRICE
Pricing Policies:
If a firm has the power in its market to set its own price, it can adopt a pricing policy. Market penetration pricing: setting prices of products relatively low compared to those
of similar products Destroyer pricing: Deliberate price cutting or offer of ‘free gifts/products’ to force
rivals (normally smaller and weaker) out of business or prevent new entrants Follow-the-leader pricing: A pricing strategy adopted by firms which copy the market
leader's prices Skimming: High price, Low volumes, Suitable for products that have short life cycles
or which will face competition at some point in the future.TATA WINGER CARGO uses the the market penetration pricing policy. The price of WINGER CARGO is set to be 5.72Lakhs(Ex-showrom).
PLACE
What is a Marketing Channel?
This is a set of interdependent organizations involved in the process of making a product or service available for use or consumption.
Channel functions
Gathers information on customers, competitors and other external market data Develop and disseminate persuasive communication to stimulate purchases Agreement on price and other terms so that transfer of ownership can be effected
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Placing orders with manufacturers Acquire funds to finance inventories and credit in the market Assume responsibility of all risks of the trade Successive storage and movement of products Helps buyers in getting their payments through with the banks Oversee actual transfer of ownership
Types of intermediaries
Distributors Wholesalers Retailers Department storesWINGER CARGO has only distributors as intermediaries.
PROMOTIONPromotion is only a means of communication about the product without the motive of
persuading for that act which a customer do not want to do.In marketing terms, the role of promotion is to inform, remind and persuade existing or prospective customers to accept, resell, recommend or use of a product, service and ideas.
What is Promotion mix?
Promotion mix consists of careful blending of advertising, personal selling, sales promotion, public relations, publicity and propaganda; to accomplish the marketer’s promotional objectives.When deciding the promotional mix, the management should consider:-
The target audience/ Market size and concentration The objective of the promotional effort. The nature of the product. The stage of the product’s life cycle. The funds available for the promotion/ Resource Availability and the cost of each promotional tool. Customer information needs
Elements under Promotion mix
a) Advertisingb) Sales Promotionc) Personal Sellingd) Public Relationse) Publicityf) Propaganda
For WINGER CARGO advertising, public relations and publicity was carried out. A consistent grass root interaction with the customers was also done for awareness generation, conversion and sustenance.
The various tasks carried out are:-• The target levers were first identified such as:- Courier, Logistics, FMCGs,
• Database regarding the potential customers from each segment was prepared.
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• An audio visual presentation was prepared to be used for showing the customers.
• Demo was given to each segment for a touch and feel experience.• Leaflets were designed.• Customers were shown the way the can also carry out the branding of the
organization with the help of the vehicle.
OBJECTIVE
Identify the levers
Recognize the potential customers from each lever
Customer awareness regarding the product(WINGER CARGO)
Determinacy of the taste and preference of the customers lever wise
Measurement of the potentiality of the targeted group
Branding of the product
Understand the requirements of the customers
Upgradation of customer’s preference.
To understand the market potentiality for TATA Motors.
To determine the acceptable price of the product.
To determine the requirements and needs of the potential customers.
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To know what people perceive and thinking about Tata Motors and its products.
To find out the satisfaction level of people.
SCOPE OF THE PROJECT
In the present world of changing technology and turbulent environment, a firm has to constantly understand the future demand and latest trend in market. For this, they should be like an open system so that they can change themselves according to the environmental changes, only then a firm can survive.
I did marketing for TATA MOTORS for two months. I collected data by interviewing various customers for the fulfillment of my market research.
The extent of my project is:- • Consumer preferences are found out which would help the organization for further
development of strategies, enhancement of the present strategies and new product development.
• Database of the budding customers is being prepared which would prove profitable in the near future.
• Customer’s attitude towards the brand is identified.
• Brand’s position in the market is known.
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• All the competitors are recognized. This would facilitate the organization in making a proper SWOT analysis.
• Market share of the competitors are found out that would help the organization in building up further strategies to gain market share.
METHODOLOGY
Methodology is defined as1. "the analysis of the principles of methods, rules, and postulates employed by a
discipline" or 2. "the development of methods, to be applied within a discipline" 3. "a particular procedure or set of procedures
Methodology refers to the rationale and the philosophical assumptions that underlie a particular study.
SOURCES OF DATAA. Primary data:- primary data were collected through a questionnaire designed
separately for customers. A pilot survey was conducted to test the utility of the questionnaire and necessary changes being made.
B. Secondary data:- secondary data was collected from i. Consortium Automobiles
ii. www.justdial.com and www.google.com
MODE OF DATA COLLECTIONThe requisite data was collected using two methods i-e
i. Questionnaire:- a printed questionnaire was given to each customer with a request to answer it and return it.
ii. Survey:- Personal interview was done to record the likes and dislikes of the customers.
RESEARCH INSTRUMENT:- Printed questionnaire
SAMPLE SIZE:- 77
SAMPLING TECHNIQUE:-Simple random sampling and judgmental sampling.
SAMPLING AREA:- Bhubaneswar.
METHODS OF DATA ANALYSIS:-• Bar graphs• Pie-charts
LIMITATIONS
• The study is confined to Bhubaneswar only.
• There is possibility of sampling errors in the study.
• The responses of the consumers may not be genuine.
• The questions included in the questionnaire may not be comprehensive.
• Continuous and reliable information was not available.
• Some of the information was confidential so much information was not revealed.
• The time span of the survey was short and hence only major aspects were considered.
• Availability of the respondents amidst their busy schedule did not permit detailed study.
• Lack of professional approach since researcher is a student.
• Limited knowledge of the researcher in the field of research may lead to interpretation errors.
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LEVERWISE OWNERSHIP ANALYSIS OF THE TARGETED CUSTOMER GROUP
Owners(in %) non owners(in%)COURIER AND LOGISTICS 66.6 33.4PACKERS AND MOVERS 100 0MARINE EXPORTERS 100 0CATERING SERVICES 50 50F.M.C.G 77.7 22.2PHARMACEUTICALS 40 60LOCAL TRANSPORTERS 100 0BAKERY 66.6 33.3CASH VAN COMPANIES 100 0F.M.C.D 22.2 77.7
INTERPRETATIONMost of the customers contacted use their own vehicles for their business. Only few
segments hire vehicles.
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ANALYSIS ON TYPE OF CARGO BOX USED BY TARGETED CUSTOMER
OPEN CONTAINER(in%)
CLOSED CONTAINER (in %)
COURIER AND LOGISTICS 25 75PACKERS AND MOVERS 83.3 16.7MARINE EXPORTERS 0 100CATERING SERVICES 50 50F.M.C.G 62.5 37.5PHARMACEUTICALS 16.7 83.3LOCAL TRANSPORTERS 80 20BAKERY 0 100CASH VAN COMPANIES 0 100F.M.C.D 77.7 22.2
INTERPRETATIONIt was found that the preference of the customers for open container vehicle or closed
container vehicle depends upon their type of business. But mostly closed container bodied vehicle is preferred so that the goods could be protected from certain natural calamities like:- rain, hot sun etc. The cash van companies, confectionaries, marine exporters and the pharmaceutical distributors make use of only closed container bodied vehicles.
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MAIN CONCERNS OF CUSTOMERS FOR DELIVERY VAN
FEATURES ACCEPTANCE (in %)
PRICE 20
FUEL EFFICIENCY 38
LOAD CAPACITY 27
WARANTEE 8
WATERPROOFING 7
INTERPRETATIONCustomer’s primary importance is for fuel efficiency then loading capacity and then to
price. The others are of secondary importance.
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Customer perception about delivery van
STONGLY DISAGREE
MILDLY DISAGREE
NEITHER AGREE NOR DISAGREE
MILDLY AGREE
STRONGLY AGREE
VOLUME CAPPACIITY 15 19 0 8 38LOAD CAPACITY 0 16 0 20 44BUYING DECISION INFLUENCED BY FINAL PRICE 30 28 0 10 12BUYING DECISION INFLUENCED BY AVAILABILITY OF EASY FINANCE 0 0 5 5 70NO TIME RESTRICTIONS 0 0 20 30 30HIGHER MILEAGE 0 0 0 0 80ELEGANT LOOKING 0 0 40 20 20GOOD SUSPENSION 0 0 13 10 57EXCELLENT AFTER SALES SERVICE 0 0 0 4 76
INTERPRETATIONHigher mileage, excellent after sales service, availability of easy finance etc
are some of the features to which the customers strongly agree to.
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FEATURE ACCEPTABILITY of winger cargo
LOADING AREA PRICE
FUEL EFFICIENCY
LOADING VOLUME
ECO-FRIENDILY
LIKE 58 7 49 25 77
DISLIKE 22 73 31 45 3
INTERPRETATIONFrom the graph it is found that WINGER CARGO is disliked by people because of its
high price. The BSIII engine makes it very eco-friendly. The customers appreciate the loading area of the vehicle.
A STUDY OF MARKETING STRATEGIES OF SWIFT AZN-08-10-DIMAT -1- A STUDY OF MARKETING STRATEGIES OF SWIFT AZN-08-10-DIMAT -2- DECLARATION
I Ali Zuhair Naqvi, Master of Business Administration (MBA) 3rd Semester student from Disha Institute of Management And Technology(DIMAT) hereby declare that the
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Seminar Report Titled³Ma r k etingstr at egi es of Swift ´ is a genuine work done by me & all the information collected is authentic to the best of my knowledge.
I hereby declare that this report is the record of authentic work carried out byme during the academic year 2009-2010. Ali Zuhair Naqvi ` MBA 3rd Sem. Section ± µA¶ A STUDY OF MARKETING STRATEGIES OF SWIFT AZN-08-10-DIMAT -4- INDEX Sl. No. P articul ars Page Number 1. Introduction 5 2. Indian Automobile Industry 5 3. History 5 4. Overview 7 5. An Introduction to Maruti Udyog Ltd. 15 6. Products of Maruti Suzuki 17 7. Competitors of Maruti Udyog Ltd. 18 8. Competitors of Maruti Suzuki Swift 20 9. Marketing Mix 21 10. Swot Analysis 25 11. Objectives of the Study 32 12.
INTERPRETATIONTATA Ace is being widely used in the market. This shows that there is a competiton
within the brand. Packers and movers are the highest user of the vehicle TATA Ace.
ACCEPTANCE OF WINGER CARGO
ACCEPTANCE( IN NO.)
LIKE 43
DISLIKE 32
NOT INTERESTED 5
INTERPRETATIONThere were very few not interested customers but most of the customers visited liked
winger cargo because of its elegant looks, good suspension, user friendliness etc. there were some customers who disliked winger cargo and the reason was found to be higher price and in comparison lower mileage.
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FINDINGS
The nearest rival of winger cargo in S.C.V segment in Bhubaneswar are:-
VE
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PR
ICE
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RD
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+ B
OD
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TO
TA
L P
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TATA ACE (HT,EX)
16HP, 2cyl 38nm@ 2000rpm
745kgs2140* 1430*300
7.02*4.69*0.984
4.59 292160, 303221
5000+ 12027+ 20000
329187(HT), 340248(EX)
TATA ACE (SUPER)
70HP, 2cyl 38nm@ 2000rpm
1000kgs2630* 1460* 300
8.62*4.79*0.984
5.3 382931 6000+ 12500+ 20000
421431
MAHINDRA MAXIMO
25HP, 2cyl 55nm@ 2200rpm
850kgs
2280* 1540* 300
7.4*5.05* 1.08
5.9 296000 5000+ 12000+ 20000
333000
APE TRUCK (SIMPLE, PLUS)
11.5HP, 1cyl
21nm@ 2025rpm
860kgs
226000, 260000
4400+ 9500+ 20000
259800(SIM), 296000(PLUS
FORCE (M40)
14HP, 1cyl 37@ 3200rpm
790kgs
2286* 1554* 1676
7.5*5.1* 5.5
5.9
FORCE TRUMPH
39HP, 2cyl 124nm@ 1600rpm
1000kgs 2438* 1554* 1938
8*5.1* 6.36
7.3
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The nearest rival of winger cargo in L.C.V segment in Bhubaneswar are:-V
EH
ICLE N
AM
E
EN
GIN
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OW
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TO
RQ
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PAY
LO
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IMEN
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VO
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IN C
U.M
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PR
ICE (
SH
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)
RO
AD
TA
X+
IN
SU
RA
NC
E+
B
OD
Y T
OTA
L P
RIC
E
MAHINDRA MAX TRUCK
63HP, 4CYL
18Onm@ 1500-1800 rpm
900kgs 2200*1530*458
7.21*5*1.5 5.1 331000 9850+12000+ 30000
382850
MAHINDRA MAX PICKUP, PICKUP FB
63HP, 4CYL
18Onm@ 1500-1800 rpm
1160kgs 2540*1700*650
8.3*5.57*2.13
6.58 456949, 473725
11000+17500+ 30000
515298,532225
MAHINDRA BOLERO MAX TRUCK
63HP, 4CYL
18Onm@ 1500-1800 rpm
1000kgs 2120*1450*295
7.21*5*1.5 4.8 349000 10850+17500+ 30000
407350
MAHINDRA BOLERO PICKUP FB,PS
63HP, 4CYL
18Onm@ 1500-1800 rpm
1170kgs 2550*1670*250
8.36*4.43*2.46
6.48 486195, 494344
11000+17500+ 30000
544695, 552844
TATA 207
65HP 4CYL
18Onm@ 1800 rpm
1110kgs 2630*1460*300
8*6.25*1.36
5.85 466513 11000+17500+ 30000
525013
TATA 407
75HP, 4CYL
225nm@ 1800rpm
2250kgs 2533*1905*350
8.3*6.25*1.45
8.0 504804 12000+18000+ 40000
5748404
TATA WINGER
90HP, 4CYL
190nm@ 2000-3000rpm
1200kgs 2755*1670*1900
9.2*5.5*6.5
8.7 5478404 8000+17280
572811
MARUTI OMNI CARGO
35HP, 3CYL
50nm@ 2025rpm
475kgs 1600*1940*1000
5.1*3.08*3.2
1.5 211255 16845+10169
231269
FORCE DELIVERY VAN
75HP, 4CYL
195nm@ 2000rpm
1410kgs 2820*1650*1830
11.5*6*6.2 1.5 615000 8000+19000
642000
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LEVERWISE FINDINGS OF LIKES AND DISLIKES OF TARGETED
CUSTOMERS
F.M.C.G
LIKES Performance of the vehicle Closed container body of the vehicle Lower ground clearance of the vehicle No legal restrictions to move in the city limits Greater payload than other small and light commercial vehicles Power steering facility Elegant looks of the vehicle
DISLIKES Higher price of the vehicle than other light commercial vehicles Comparatively lesser payload than TATA 407 Lesser fuel economy than other light commercial vehicles Ambulance type looks on the back side Absence of chasis in vehicle
MARINE EXPORTERS
LIKES Elegant looks of the vehicle Closed container body of the vehicle Larger cargo area No legal restriction to move in the city limits Greater payload than other light and small commercial vehicles Enough space for branding
DISLIKES Insulation of the vehicle is difficult Fully built body attached with driver cabin Absence of chasis in the vehicle makes customisation costly Low ground clearance makes vehicle not suitable for long distance travel Back door glass again increases the cost of customisation Payload is comparatively lesser than TATA 407
COURIER AND CARGO COMPANIES
LIKES Container type body of the vehicle Higher engine power suitable for the movement of heavy cargo goods
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Power steering facility of the vehicle Higher payload than small and light commercial vehicles No legal restriction for the city movement Space availability for branding Higher cargo space
DISLIKES Price of the vehicle is more than TATA 407 pick up Lesser payload than TATA 407 Fully attached driver cabin and cargo box Low ground clearance makes vehicle not suitable for long distance travel Low fuel efficency Back glass door is not suitable for cargo works
F.M.C.D COMPANIES
LIKES Performance of the vehicle Low ground clearance Elegant looks of the vehicle Greater payload than other light commercial vehicles Power steering facility of the vehicle Larger cargo space Larger space available for branding
DISLIKES Closed container restricts from carrying lengthy f.m.c.d goods Higher price than any other light commercial vehicles Low fuel economy than other LCV’s Absence of the chasis body
CASH VAN COMPANIES
LIKES Closed container body of the vehicles Enough available for customization of the vehicle Greater engine power of the vehicle Space available for branding
DISLIKES Height of the vehicle is more than requirement Back glass door facility Customization cost of the vehicle
PACKERS AND MOVERS
LIKES
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No legal restriction to move in the city limits Closed container body of the vehicle Larger cargo space of the vehicle Greater payload than any other light commercial vehicle Higher engine power of the vehicle
DISLIKES Higher price than other LCV’s Low fuel economy Larger vehicle in comparison to their requirement
PHARMACEUTICALS Major pharmaceutical distribution agencies in Bhubaneswar are smaller distribution
agencies so they conduct their logistics operation through local transporters and courier companies.
Some of the bigger pharmaceuticals distributors like capital enterprises and primal healthcare had shown some interest in knowing about winger cargo and would contact if required.
NEWSPAPER INDUSTRY All the major newspaper companies in Bhubaneswar conduct their local distribution
of newspapers through local vendors. As the companies does not conduct any distribution work so they were not interested
in winger cargo.
BAKERY In bakery segment majority of the players are small scale industries they conduct their
local distribution through 3 wheelers and by personal sales. Some of the bigger players like Mongines conduct their local distribution through
local vendors and they would contact if situation demands.
HOTEL INDUSTRY In Bhubaneswar all the top hotels we visited does not provide outdoor catering
services so all the hotels we visited were not interested in winger cargo.
CATERING SERVICES All top rated catering services in Bhubaneswar conduct their local operations through
small commercial vehicles like TATA ACE and 3 wheelers. Their major dislikes was higher price of the winger cargo.
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RECOMMENDATIONS
Complete information regarding winger cargo must be provided to the sales executive and they must be trained basing upon extra benefits that a winger cargo can offer.
While meeting the customers, the sales executive must know the type of business operation conducted by the customer and type of commercial vehicle used by the customer for logistics support.
Sales executive must know what are the requirements of the targeted customer for a commercial vehicle
Sales executive must know detailed specification regarding nearest rival of winger cargo present in the Bhubaneswar market and should be able to explain the target customer on demand.
A heavy sales promotion activity IS required because the company has manufactured a new product which people are unaware of.
A good advertising and promotion propaganda is required.
Personal meetings and frequent follow ups is required to increase their revenues.
Special arrangements can be made for a meet for the Heads / Owners of member companies by Invitation at a centralized venue over high tea or dinner depending on the strength.
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CONCLUSION
TATA MOTORS is India’s largest automobile industry. Although it has a good brand value still it faces stiff competiton. Huge advertisement, brand awareness programs, sales promotional programs, advanced technology-featured product in a comparably less price and an effective after sales service can enable to attract a considerable number of customers by the company.
The customers are now made aware of the existence of the vehicle in Bhubaneswar market. The step is to upgrade the customers by frequently letting them know about the benefits and the unique features of the vehicle over the existing once.
Any organization can gain a successful position in the market only when it wins the support of its prospective customers and acquires their loyalty. To achieve this company’s vision should be customer focused and the strategies should solely focus towards maximizing of customers benefit and satisfaction.
If the recommendations suggested earlier are incorporated, then WINGER CARGO could benchmark itself against its competitors in Bhubaneswar as well as Orissa market.
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51
DETAILS OF THE CUSTOMERS VISITEDDATE COMPANY ADDRESS CONTACT
PERSONCONTACT
E-MAIL BRIEF OF OPERATIONS
BRIEF OF REQUIREMENTS
Action
26th May 2010
Agrotech foods Ltd
S-3/19-Sec A Mancheswar Industrial Estate, Bhubaneswar
Susanta Kumar Mohanty
9437080240
owns 3 TATA ACE open container small commercial vehicles
All the purchase decision regarding vehicles are done by corporate office (hubli,karnataka)corporate office purchases 100 vehicles on an average per year