Motors India Working of Sales Planning Department A Project Report

JUNE-JULY 2011 CONTENTS

1. About HONDA……………………………………….. 1

2. HONDA in India……………………………………… 5

3. About HMI……………………………………………. 11

4. Working of HMI………………………………………. 13

5. Order Processing……………………………………. 15

6. Assignment- Case Study of VOR…………………. 17

7. Bibliography…………………………………………. 19 Honda Motor Company, Ltd. ( 本 田 技 研 工 業 株 式 会 社 ) is a Japanese multinational corporation primarily known for manufacturing automobiles and motorcycles.

Honda has been the world's largest motorcycle manufacturer since 1959, as well as the world's largest manufacturer of internal combustion engines measured by volume, producing more than 14 million internal combustion engines each year. Honda surpassed Nissan in 2001 to become the second-largest Japanese automobile manufacturer. As of August 2008, Honda surpassed Chrysler as the fourth largest automobile manufacturer in the United States. Honda is the sixth largest automobile manufacturer in the world.

Honda was the first Japanese automobile manufacturer to release a dedicated luxury brand, , in 1986. Aside from their core automobile and motorcycle businesses, Honda also manufactures garden equipment, marine engines, personal watercraft and power generators, amongst others. Since 1986, Honda has been involved with artificial intelligence/robotics research and released their ASIMO robot in 2000. They have also ventured into aerospace with the establishment of GE Engines in 2004 and the Honda HA-420 HondaJet, scheduled to be released in 2011. Honda spends about 5% of its revenues into R&D.

History

From a young age, Honda's founder, (本田宗一 郎 ,) had a great interest in automobiles. He worked as a mechanic at a Japanese tuning shop, Art Shokai, where he tuned cars and entered them in races. A self-taught engineer, he later worked on a piston design which he hoped to sell to Toyota. The first drafts of his design were rejected, and Soichiro worked painstakingly to perfect the design, even going back to school and pawning his wife's jewelry for collateral. 2008 (USA spec)

Eighth Generation (Asian Version)

Eventually, he won a contract with Toyota and built a factory to construct pistons for them, which was destroyed in an earthquake. Due to a gasoline shortage during World War II, Honda was unable to use his car, and his novel idea of attaching a small engine to his bicycle attracted much curiosity. He then established the Honda Technical Research Institute in Hamamatsu, Japan, to develop and produce small 2-cycle motorbike engines. Calling upon 18,000 bicycle shop owners across Japan to take part in revitalizing a nation torn apart by war, Soichiro received enough capital to engineer his first motorcycle, the Honda Cub. This marked the beginning of Honda Motor Company, which would grow a short time later to be the world's largest manufacturer of motorcycles by 1964.

The first production automobile from Honda was the T360 mini pick-up truck, which went on sale in August 1963. Powered by a small 356 cc straight-4 gasoline engine, it was classified under the cheaper Kei car tax bracket. The first production car from Honda was the S500 sports car, which followed the T360 into production in October 1963. Its chain driven rear wheels point to Honda's motorcycle origins. Hond a

HMS HSP HSCI HMI I P

Corporate profile and divisions Honda is headquartered in Minato, Tokyo, Japan. Their shares trade on the Tokyo Stock Exchange and the New York Stock Exchange, as well as exchanges in Osaka, Nagoya, Sapporo, Kyoto, Fukuoka, London, Paris and Switzerland.

The company has assembly plants around the globe. These plants are located in China, the United States, Pakistan, Canada, England, Japan, Belgium, Brazil, New Zealand, Indonesia, India, Thailand, Turkey and Perú. As of July 2010, 89 percent of Honda and Acura vehicles sold in the United States were built in North American plants, up from 82.2 percent a year earlier. This shields profits from the yen’s advance to a 15- year high against the dollar.

Honda's Net Sales and Other Operating Revenue by Geographical Regions in 2007

Geographic Total revenue (in Region millions of ¥ ) Japan 1,681,190 North America 5,980,876 Europe 1,236,757 Asia 1,283,154 Others 905,163

American Honda Motor Company is based in Torrance, California. Honda Canada Inc. is headquartered in the Scarborough district of Toronto, Ontario, and is building new corporate headquarters in Markham, Ontario, scheduled to relocate in 2008; their manufacturing division, Honda of Canada Manufacturing, is based in Alliston, Ontario. Honda has also created joint ventures around the world, such as Honda Siel Cars and Hero Honda Motorcycles in India, Guangzhou Honda and in China, and Honda Atlas in Pakistan.

Current market position

With high fuel prices and a weak U.S. economy in June 2008, Honda reported a 1% sales increase while its rivals, including the Detroit Big Three and Toyota, have reported double-digit losses. Honda's sales were up almost 20 percent from the same month last year. The Civic and the Accord were in the top five list of sales. Analysts have attributed this to two main factors. First, Honda's product lineup consists of mostly small to mid- size, highly fuel-efficient vehicles. Secondly, over the last ten years, Honda has designed its factories to be flexible, in that they can be easily retooled to produce any Honda model that may be in-demand at the moment.

Leadership

• 1948–1973 – Soichiro Honda • 1973–1983 – Kiyoshi Kawashima • 1983–1990 – Tadashi Kume • 1990–1998 – • 1998–2004 – Hiroyuki Yoshino • 2004–2009 – • since 2009 – Takanobu Ito HONDA IN INDIA The history of the Honda Motor Company began with the vision of one man - Soichiro Honda and his dream of personal mobility for everyone. This vision of Soichiro Honda was international in character. His desire was to lead the world in technology, and make a significant contribution to the creation of a better society. The notion of globalization formed the very core of this company’s philosophy for growth and excellence.

On these lines of globalization, the Honda Siel Cars India Ltd., (HSCI) was incorporated in December 1995 as a joint venture between Honda Motor Co. Ltd., Japan and Siel Limited, a SiddharthShriram Group company, with a commitment to providing Honda’s latest passenger car models and technologies, to the Indian customers in the economically growing India. The plant became fully operational in 1997. The Indian story didn’t just end there. The Honda Motor Co. Ltd. jointly with the Seil Limited established the Honda Siel Power Products Limited (HSPP) and the Honda Motorcycle & Scooter PVT Ltd. (HMSI) to cater the Indian market with highly fuel efficient and technologically world class power and two wheeler products respectively. These ventures by the Honda Motor Co. Ltd., Japan, completely changed the dynamics of the Indian market for good. These ventures also set a new bench mark, in terms of success, for any other Automotive and Consumer Power Products manufacturing company in India and abroad. Currently, Honda stands at the fourth position in the Indian passenger car industry.

HONDA NETWORK IN INDIA: • HONDA MOTORCYCLE & SCOOTER INDIA PVT. LTD.:

The HMSI factory is spread over 52 acres, with a covered area of about 85,815 square meters at Manesar, Gurgaon district of Haryana. The foundation stone for the factory was laid on 14th December 1999 and the factory was completed in January 2001. The initial installed capacity was 100,000 scooters per year, which has reached 6,00,000 scooters by the year by 2007 and motorcycle capacity shall be 4,00,000 per annum. The total investment outlay for the initial capacity was Rs. 215 crores and now the accumulated investment is 800 crores.

» In-House Facilities

Gravity Die Casting & Low Pressure Die Casting Gravity Die-Casting & Low pressure Die Casting Sections are for manufacturing critical engine parts.

» Welding Robot

Weld Shop has spot welding, seam welding and MIG welding machines to weld various sheet metal parts to form the basic frame and other scooter panels.

» Paint Shop Robot

Paint Shop has a conveyor system, which is unique amongst all Honda Factories in the world. The conveyor car carrying the parts is rotated and dipped so as to enable good paint adhesion, high gloss and superior paint finish. Robots are used in painting for improved paint finish.

» Engine Assembly

Engine Assembly is done in an enclosed air pressurized area to protect the engine from dirt and dust. Each of the engines is then inspected for various parameters.

» Frame Assembly

Frame Assembly is done at the slat conveyor. After the Frame Assembly line is the roller tester to check the final scooter quality before handing over to dispatch.

• HONDA MOTOR INDIA PVT. LTD.:

Honda Motor India Pvt Ltd. engages in the development, production, and manufacture of motor products. Honda Motor India Pvt Ltd. was founded in 2006 and is based in Noida, India. Honda Motor India Pvt. Ltd. operates as a subsidiary of Honda Motor Co. Ltd.

Mr. Takashi Nagai acts as the Chief Executing Officer and President of the company.

• Honda Siel Cars India Ltd.:

Honda Siel Cars India Ltd., (HSCI) was incorporated in December 1995 as a joint venture between Honda Motor Co. Ltd., Japan and SIEL Limited, a Siddharth Shriram Group company, with a commitment to providing Honda’s latest passenger car models and technologies, to the Indian customers. The total investment made by the company in India till date is Rs 1620 crores in Greater Noida plant and recently Rs 784 crores were invested in Tapukara (2nd) Plant. HSCI’s first state-of-the-art manufacturing unit was set up at Greater Noida, U.P in 1997. The green-field project is spread across 150 acres of land (over 6, 00,000 sq. m.). The annual capacity of this facility is 100,000 units. The company’s second manufacturing facility is in Tapukara, Rajasthan. The first phase of this facility was inaugurated in September 2008.

The company’s product range includes , , Honda Civic and Honda Accord which are produced at the Greater Noida facility with an indigenization level of 77%, 76%, 74% and 28% respectively. The CR-V is imported from Japan as Completely Built Units. Honda’s models are strongly associated with advanced design and technology, apart from its established qualities of durability, reliability and fuel-efficiency • HONDA R&D (INDIA) PVT. LTD.:

Honda R&D (India) PVT.LTD.engages in Research and development of motorcycles and power products in India.Honda R&D (India) PVT. LTD was founded in 2003 and is based in Noida, India. Honda R&D (India) PVT. LTD. acts as a subsidiary of Honda Motor Co. Ltd.

• HONDA SIEL POWER PRODUCTS LTD.: Honda Siel Power Products Limited (HSPP), formerly known as Shriram Honda Power Equipment Limited, is a joint venture between Honda Motor Co. Japan and Siel Ltd., with 67% Equity Stake of Honda Motor Co. Japan. It is engaged in the manufacturing of Portable Generators, Water Pumping Sets and General Purpose Engines at its state-of-the-art plant at Greater Noida and Pondicherry.

With strength of over 800 dealers and 15 Area Offices spread across the country, HSPP has been bringing joy and satisfaction to more than 1.5 million users and this makes HSPP the undisputed leader in the field of portable generators. It is a part of one of the world’s largest power products company manufacturing a complete range of “4- stroke range of Portable generators, Water Pumps, Engines & Lawnmowers”, to suit your requirements. This gives you the choice to demand more from the world leader "Honda".

HSPP benefits from the rich experience of Honda Motors, Japan, the second largest engine manufacturer in the world, because of their strong emphasis on R&D and in- house technical innovation. India’s first LPG based Generator” along with the Super Silent Key Start Generator portable kerosene generators are some of the products which exemplify Honda’s pursuit of technological excellence. The product range of Generators conforms to the most stringent phase II Noise & Emission norms as laid down by the Central Pollution Control Board (CPCB), Government of India.

HONDA MOTOR INDIA

COMPANY OVERVIEW:

Honda Motor India Pvt Ltd. engages in the development, production, and manufacture of motor products. Honda Motor India Pvt Ltd. was founded in 2006 and is based in Noida, India. Honda Motor India Pvt. Ltd. operates as a subsidiary of Honda Motor Co. Ltd.

Formation of HMI is part of the overall strategy to strengthen and integrate operations of Honda companies in India with respect to spare parts. In all it supplies parts to Honda Siel Cars India Ltd.(HSCI),Honda Motorcycle and Scooter India Pvt. Ltd.(HMSI) and Honda Siel Power Products Ltd (HSPP). The parts to be supplied are first brought up to the warehouses located at different parts of the country and are then supplied to the dealers according to their orders. HMI has four warehouses at Greater Noida, Mumbai, Chennai and Kolkata respectively. The orders for the parts first reach the dealers from the customers, who in turn demand it from HMI. The HMI caters the orders through inventory strategically maintained in all warehouses to meet market demand. It then dispatches these orders to the respective dealers within 48 hours of the order being brought in.

KEY RESPONSIBILITIES PERFORMED:

• Estimate market demand of HONDA spare parts • Maintain inventory strategically in warehouses • Supply of spare parts of Honda automotive components. • Prevents the burden of storage of parts at all respective dealers. • Monitor regular & smooth supply of Spare Parts

KEY EXECUTIVES:

MR. Takashi Nagai Chief Executive Officer and President

WORKING OF HMI

Dealer / Stockist of HMSI, HSCI & HSPP

ORDER

HMI

PARTS

Vendor (Local and Imported)

HMI or Honda Motors India is the company which supplies parts to the HMSI, HSCI and HSPP divisions of Honda. It works in tandem with the dealers and the vendors and the parts are supplied according to the needs and requirements of the customers. The dealers or the stockiests place orders for different parts to HMI on the basis of priority. The orders may be Stock, Will Call, Urgent train, Urgent road, Urgent air or CBO. The HMI forecast the demand & maintain Inventory strategically to cater the market demand. The vendors of HMI may be local or imported. Imported vendors are outside India. The vendors from different parts of India supply the required parts to HMI, which forwards the parts according to the orders to the respective dealers, who give them to the customers in the market. The dealer may place different orders. The parts are then dispatched according to the type of order. Types Of Order:-

• Stock • Will Call (Dealer comes to warehouse & receives order) • Urgent Train • Urgent Road • Urgent Air • CBO (Extra 6% service charges) ORDER PROCESSING

The process of placing an order by the dealer and the ultimate dispatches of parts takes place in several stages. This process is explained as follows. The dealer first places the order for the parts. The order reaches the HMI and then the orders of different dealers are uploaded on the system of HMI. Then an automatic WAVE runs in the system of HMI which checks the availability of different parts ordered. If material is not in the warehouse then it becomes Back Order. While if the material is present in warehouse, then the various parts are allocated to different dealers. Now the parts are ready to be picked and release to warehouse. Then a Pick List is generated for the parts to be picked inside the warehouse. If the parts are present at the actual location at the time of picking, then they are packed and are ready to be released. But if they are not present then they become Back Ordered. Once the parts have been picked and packed, then they are ready to be released from the warehouse. Thus the final dispatching of the parts is done to the respective dealers through Logistics deptt. The process can also be depicted by the means of a flowchart as follows. Dealer

Order

Upload

Wave

M Is a No a te l r W in i Back Order H o H u s e Yes

Allocate

Release to WH

Pick List

No Picking Back Ordered

Yes Ready to release

Dispatch

ASSIGNMENT

(Case Study regarding VOR) Objective- Dispatch and supply parts urgently to VOR.

Description-VOR or Vehicle off Road parts have the highest priority amongst the parts to be delivered to the dealers. VOR is a category of vehicles that are not running and have been off-road because of some damages or accidents, and thus are needed to be up and running again urgently. Thus it is needed that the VOR parts are dispatched from the warehouses on the highest priority basis as soon as the dealers place the orders for them. Procedure-

Data received from Dealer/Stockist

Data Analysis On Hand Quantity (Warehouse wise) Parts needed to order from vendors Part Order released for non- Manual punching of On Hand Quantity available Parts Urgent Road Dispatches

Monitoring and Feedback The instances of VOR had increased recently, thus it was decided to get the details of vehicles pending from dealers across the country for the want of parts. Thus the information was taken from the service department. Based on this specific parts were organized from within the Warehouse. All materials which were not available within the warehouse were freshly ordered and organized, and all these materials were sent to the respective dealers against their specific VOR orders. Thus the pendency of VOR orders was made nil. Learning- Spare parts should reach on time to the customers, otherwise dissatisfaction arises. Proper sales planning and coordination with warehouse will lead to achieve the ultimate goal of HMI, i.e. customer satisfaction.

BETTER SALES PLANNING

PROPER SUPPLY CUSTOMER INCREASE IN OF SPARE SATISFACTION SALES PARTS

BETTER MARKET SHARE/PROFITS BIBLOGRAPHY

The following websites have been used-

1. www.wikipedia.org 2. www.hondacarindia.com