MMaarutrutii AutAutoo EExpoxpo’’0088 IIntntroroducducttioionn Maruti Suzuki India ltd. Maruti is India's largest passenger car company, which account for over 50 per cent of the domestic car market. Maruti have a sales network of 562 outlets in 372 towns and cities, and provide maintenance support to customers at 2538 workshops in over 1200 towns and cities (as on December 31,2007). The company boasts about its products, which offer unsurpassed fuel efficiency, low maintenance costs and easy availability of genuine parts. MUL extended its product range to include vans, multi-utility vehicles (MUVs) and mid- sized cars. Suzuki saw its Indian sales rise 21 per cent to 653,000 cars Of the $3.5 billion Suzuki plans to spend on its expansion in India MUL’s Competitive Advantage Size Low Initial investment Unique concessions from the government Indigenous sourcing of components Fully depreciated plants High labour productivity Maruti Suzuki ranks highest in customer satisfaction with authorized dealership service Maruti models Comparing Maruti 800 and Tata Nano Maruti Suzuki India Limited has showcased three concept cars at the Auto Expo 2008 • Concept A-Star, • Concept Splash and • Concept Kizashi Concept A-Star It is a concept car because it is for the first time that Suzuki has premiered a concept in India. It is the first Japanese-Indian concept vehicle. Segment: A (currently Alto is the market leader in this segment. Expected price: A-star is expected to be priced around the 3-4 lakh range($7500) Competitors: Chevrolet Spark and the Hyundai i10. Segmentation,Targeting and Positioning Segmentation DEMOGRAPHIC: A) Age- 20-34 B) Gender- Male, Female C) Family size- 3-4 , 4+ D) Income - RS 20000-30000, 30000-50000, 50000 and above. E) Occupation- Professionals, Officials, Supervisors, Home makers, Youngsters. PSYCHOGRAPHIC A) Social class: Middle class, working class, upper lowers. B) Lifestyle: Strivers, Achievers C) Personality: Gregarious, Ambitious, Compulsive BEHAVIORAL: A) Benefits: Quality. Service, Economy, Speed B) Readiness stage: Interested, Intending to buy CConontt…….……..... TARGET MARKET: Expected price: A-star is expected to be priced around the 3-4lakh range It will target the small car segment A segment where ALTO is the market leader. It will mainly focus on the middle and workers class people. It will satisfy both the needs of European and Indian customers. POSITIOINING: The A-Star would be launched in other international markets gradually. The A-Star is an environmentally oriented concept and would be produced with a very efficient 1-litre petrol engine, which would have great mileage and low emissions. The A-Star might just be the new Alto in India. Porter’s Five Force Model Potential entrants Will impart a spectacular growth to the entire industry by actually widening and deepening it. It is doubtful if the current growth rate of over 50 per cent would have been possible but for the entry of these players. New entrants into this segment could be Honda with its sub-compact Jazz, or Honda Life as it is called in other markets Ford India with either the Fusion or the Fiesta Rivalry amongst the existing firms And from a second-hand car to cars like the Maruti Zen, Hyundai Santro, Daewoo Matiz or the Tata Indica. Throw in a few more lakhs and you can bite into the wider small segment populated by the Hyundai Santro, Maruti Zen, Maruti WagonR, Tata Indica, and Fiat Palio. The deluxe version of the Zen, the fully-loaded Santro and the Matiz form another segment along with the Fiat Uno. Cont……. Substitutes Maruti swift sedan, Maruti splash, Tata 1 lakh car a small family car actually a substitute for a Maruti A-star. The Indica and the Santro due to its high presence in the market can be substitute for A-star Due to lower price consumer can shift to motorbikes and scooters launched by TVS, Bajaj and Yamaha. Bargaining power of suppliers The cars of Maruti are differentiated to such an extent that it is difficult for buyers to switch over to other products. As Maruti is dominant player in the market holding 50% share in the industry, it is highly attractive to buyers. Branding- The brand Maruti is strong due to its role of quality and services Switching Costs- It’s easy for suppliers to locate new customers. CCoontnt………….. Bargaining power of buyers • Usually customers appreciate and look for various features in a car. Often there is a loyal set of customers. Cars enhance social status and there may be a strong association of price with quality and status. Switching costs- It’s easy for buyers to locate new suppliers Large number of options available Well informed customers Availability of finance schemes CCoonnccepeptt SplSplasashh Segment: B (Next generation Wagon R) Expected price: Rs 4.5-5.5 lacs Theme: ‘Family’ The name Splash signifies its desire to create a new sensation. Splash combines the sportiness of Suzuki's successful model Swift with the technologies and immense know- how Suzuki unveiled its’ splash’ MPV (Multi Purpose Vehicle) in the Frankfurt Motor Show. SegmSegmententatioation,n, TTaarrgetgetinging andand PPosositioitioningning SEGMENTATION DEMOGRAPHIC: A) Age- 20-40 B) Gender- Male, Female C) Family size- 4-5 , 5 D) Income - RS 25000-35000, 35000-50000, 50000 and above. E) Occupation- Professionals, Officials, Managers, Sales, Youngsters. PSYCHOGRAPHIC: A) Social class: Middle class, Upper middle class B) Lifestyle: Achievers, survivors C) Personality: Gregarious, Ambitious BEHAVIORAL: A) Benefits: Quality. Service, Economy, Speed B) Readiness stage: Interested, Intending to buy CCoontnt………….. TARGET MARKET: It will target the B-segment The theme of the splash is basically focusing on FAMILY It signifies its desires to create a new sensation. Its vivid sound creates a sense of freshness and youthfulness. It will likely appeal to those with small families and low budget. POSITIONING: The Japanese major chose the name Splash for the car to “signify its desire to create a new sensation. Maruti Suzuki's Splash is orientated strongly towards the European design style. Splash will be marketed for its such high seating position, good visibility and spacious interiors. Suzuki's Splash will offer comfortable space for five occupants due to clever packaging Porter’s Five Force Model POTENTIAL ENTRANTS: It is doubtful if the current growth rate of over 50 per cent would have been possible but for the entry of these players. CHEVROLET AVIO (AVEO-5) – mp3 enabled audio system, carbon fiber trim, solid fuel economic ratings. TOYOTA’S youth oriented spin off: SCION XD- subcompact interior, fuel economy 30mpg, transportation costing <$16000. VOLKS WAGEN: POLO-diesel push, sharper price $16990, face lift. RIVALRY AMONG EXISITING FIRMS: And from a second-hand car to cars like the Maruti800, Maruti zen, Hyundai santro, Maruti esteem, Maruri alto etc.. TATA’S low cost car will create a new segment as no cars available in 1lakhs-2lakhs segment. HYUNDAI latest small car-pressure on pricing. SATURN AURA XB-bidding for mid-size segment. CCoonnt….t…... BARGAINING POWER OF SUPPLIERS: The cars of Maruti are differentiated to such an extent that it is difficult for buyers to switch over to other products. As Maruti is dominant player in the market holding 50% share in the industry, it is highly attractive to buyers. Branding- The brand Maruti is strong due to its role of quality and services Switching Costs- It’s easy for suppliers to locate new customers. SUBSTITUTES: Maruti SWIFT SEDAN, Maruti A-STAR, TATA 1 lakh car a small family car actually a substitute for a Maruti SPLASH.. Maruti WAGON-R, CHEVROLET AVEO, HYUNDAI i10. PEOPLE can switch over to new bikes launched by Yamaha-R1, BAJAJ, TVS. PEOLE can go for Diesel or Cng cars due to high prices of petrol and fuel efficiency eg. SWIFT SEDAN CCoonnt……t……….…. BARGAINING POWERS OF BUYERS: SWITCHING COST- buyers looking for new suppliers. Consumer going for second hand car market. Availability of : a) Finance scheme b) Registration insurance Different substitutes available. CCoonnccepeptt KizKizasashhii Competitor: Honda’s civic Segment : D Theme: “Status”. With Concept Kizashi, Suzuki Motor Corporation has announced its entry into the D- segment. Segmentation, Targeting and Positioning SEGMENTATION DEMOGRAPHIC: A) Age- 20-34 B) Gender- Male, Female C) Family size- 3-4 , 4+ D) Income - RS 50000-75000, 75000-100000, 100000-125000, 125000-150000 and over. E) Occupation- Professionals, officials, Youngsters. PSYCHOGRAPHIC: A) Social class: Upper middle class, High class B) Lifestyle: Achievers C) Personality: Gregarious, Ambitious BEHAVIORAL: A) Benefits: Quality. Service, Economy, Speed B) Readiness stage: Interested, Intending to buy CCoontnt………….. TARGET MARKET: KIZASHI revealed in Frankfurt represents the beginning of the 3rd phase of world strategy. It is into a Luxury car segment. It will mainly target the high class people with its sporty looks and comfort, Its main objective will focus on status. It will target an un-compromised combination of affordability and emotional appeal POSITIONING: The sportiness that Suzuki wants to deliver in the D-segment will perhaps be most directly expressed by the car's dynamics. The design of the new car should have two themes: grace and dynamism. Kizashi represents Suzuki's passion for challenges (this is a major aspect of Suzuki's corporate culture), its future direction, and the competitive strengths that are unique to Suzuki. Porter’s Five Force Model POTENTIAL ENTRANTS: BMW-1-series Octavia Skoda Skoda Fabia- engines offered in 4 trims levels- active, classic, ambiente and elegance. Audi Honda Accord-LX – 16inch alloy wheel, 166-hp, 2.4-4lt cylinder engine. Chevrolet Captiva- sporty design, luxury features, seating, ride control. SUBSTITUTES: HONDA CIVIC TOYATA COROLLA HYUNDAI SONATA SKODA AUTO- OCTAVIA VOLKSWAGEN JETTA CCoontnt………….. Rivalry Amongst the existing players • The growth of the car industry is on a high pace, companies are coming up with new models every six months.