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. INTERNATIONAL SCHOOL OF INFORMATICS AND MANAGEMENT
A
CONTEMPORARORY REPORT
ON
“Market Mapping
of
EICHER Trucks & Buses”
Submitted in the partial fulfilment for the
Award of the degree of
Master of Business Administration
2012-2014
Submitted to:- Submitted by:-
DR. SUMEDHA SHANDILYA VINAY KHATRI
ASSO. PROFESSOR, ISIM MBA/12/2331
1
2
Acknowledgement
I express my sincere thanks to my project guide Mr. Sandeep Vyas .I sincerely acknowledge
him/her/them for extending their valuable guidance, support for literature, critical reviews of
project and the report and above all the moral support he/she/they had provided to me with
all stages of this project.
Vinay Khatri
3
TABLE OF CONTENTS
TOPIC PG NO.
1. INTRODUCTION - INDIAN AUTOMOBILE INDUSTRY 4
2. EICHER LTD. - COMPANY OVERVIEW 7
3. EICHER MOTORS LTD. - COMPANY PROFILE 9
4. VOLVO EICHER COMMERCIAL VECHILE LTD - OVERVIEW AND PROFILE 31
5. MARKET MAPPING OF EICHER TRUCKS AND BUSES 38
1. 1.MARKET SEGMANTATION 56
2. 2.TARGET MARKET SURVAY 57
3. 3. CUSTOMER FEEDBACK 59
4.PRESENTATION OF ANALYSED DATA 60
6. BIBLOGRAPHY 72
4
INTRODUCTION
Indian Automobile Industry
India is an emerging country with huge potential. The domestic economy is now
growing at around 8-9% per annum and India’s importance in global terms is being
reinforced by rapidly rising exports and domestic consumption. At a time when
numbers of a slowdown and overheating in the Indian economy have started gaining
momentum, the Indian rupee sprang a surprise by pushing the GDP figure past the
trillion-dollar (42,00,000 crore) mark.
The automotive industry is at the centre of India’s new global dynamic. The domestic
market expanding rapidly as incomes rise and consumer credit becomes more
widely available. Manufacturer’s product lines are being continually expanded, as is
the local automotive manufacturing base. Expectation are high that India can
develop as a global hub for vehicle manufacturers and as an outsourcing centre that
offers the global automotive industry solution high up the automotive value chain.
India eyes 25 million automotive jobs.
India's GDP is set to double over the next decade
In percentage terms, the automotive industry's contribution should also
double.
In dollar terms, the sector's contribution is set to quadruple to some $145bn
With the world’s second largest and fastest-growing population, there is no denying
India’s potential in both economic and population terms and the effect it will have on
the auto industry in the years to come. The country is already off to a good start, with
a well-developed components industry and a production level of 1 million four-
wheeled vehicles a year, plus a further 5 million two- and three-wheelers.
The automotive industry in India grew at a computed annual growth rate (CAGR) of
11.5 percent over the past five years, the Economic Survey 2011-12 tabled in
parliament on 2nd July’10 said. The industry has a strong multiplier effect on the
economy due to its deep forward and backward linkages with several key segments
of the economy, a finance ministry statement said. The automobile industry, which
was plagued by the economic downturn amidst a credit crisis, managed a growth of
5
0.7 percent in 2011-12 with passenger car sales registering 1.31 percent growth
while the commercial vehicles segment slumped 21.7 percent.
Indian Automobile industry can be divided into three segments i.e. two wheeler,
three wheeler &four wheeler segment. The domestic two-wheeler market is
dominated by Indian as well as foreign players such as Hero Honda, Bajaj Auto,
Honda Motors, TVS Motors, and Suzuki etc. Maruti Udyog and Tata Motors are the
leading passenger car manufacturers in the country. And India is considered as
strategic market by Suzuki, Yamaha, etc. Commercial Vehicle market is catered by
players like EICHER Motors, Ashok Leyland, Volvo, Force Motors, Tata Motors etc.
Key Facts:
• India ranks 12th in the list of the worlds top 15 automakers
• Contributes 5% to the GDP
• Production of four wheelers in India has increased from 9.3 lakh units in 2003-04 to
88 lakh units in 20011-12
• Targeted to be of $ 145 Billion by 2016
• Exports increased from 88,000 units in 2002-03 to 5,80,000 units in 2011-12
Market share
Market share of Light commercial vehicles in India.
6
Market share of Medium and Heavy Commercial Vehicles in India.
7
Eicher Motors
Company Overview
Eicher Motors Limited is an India-based company engaged in the business of
automobile products and related components. The Company’s product range
includes commercial vehicles (Eicher and Volvo trucks), motorcycles, and
components, including gears and engineering solutions. The Company operates in
the leisure cruiser segment with engine capacity of 350 circuit current and above.
During the year ended December 31, 2009, the Company sold 51,955 motorcycles
.In 2009, the Company introduced Classic bike in the two categories of 350cc and
500cc. The Classic bikes are powered by a single cylinder 500 cc unit construction
engine (UCE) supported by electronic fuel injection (EFI). The UCE has an
integrated assembly for the engine, gear box and clutch to reduce friction.
Eicher Motors' subsidiaries include VE Commercial Vehicles Limited, Eicher
Engineering Solutions, Inc., Hoff Automotive Design Company and Hoff Technology
Service Company.
Eicher Motors operates in three segments: Commercial Vehicles, Two Wheelers,
and Components of engineering products, as well as in the publication of city map
and travel guides. Its commercial vehicle plant is located at Dhar, MP. The company
manufactures motorcycles at a plant at Thiruvottiyur, TN, promoted under the brand
Royal Enfield. The company’s engineering component plants - located at Gurgaon,
Haryana and Dewas, MP - manufacture gears, gear boxes, and other components
The company is also involved in management consultancy services and customized.
It has a joint venture agreement with Volvo AB. The company has a strong network
of 142 dealers distributed across India. Eicher Motors is present in over 40 countries
across the world. Most of the exports are to South Asia, West Asia, and African
countries
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9
EICHER
COMPANY PROFILE
Of
EICHER
10
AN OVERVIEW
Eicher began its business operations in 1959 with the roll out of India's first
tractor. Today the Eicher Group is a significant player in the Indian automobile
industry with a gross sales turnover of over Rs. 13,700 million in the year
2002-03.
The Eicher Group has diversified business interests in manufacturing &
marketing of Tractors, Commercial Vehicles, Automotive Gears, Motorcycles,
and exports of vehicles, aggregates and components. Eicher has also
invested in the potential growth areas of Management Consultancy Services.
The activities of the Group are divided into the following business units
covering all the business interests.
EICHER LIMITED
Subsidiary Companies Products
EICHER MOTORS LIMITED - Commercial Vehicles
EICHER TRACTORS - Tractors
ROYAL ENFIELD - Motorcycles
EICHER DEMM - Gears
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EICHER INTERNATIONAL LTD - Exports
ECS LTD. – Management Consultancy
GOOD EAREH PUBLICATIONS - City Maps, Travels Guides
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EICHER MOTORS LIMITED
Eicher Motors Limited (EML) was incorporated in 1982 and introduced its first
product, the Canter, a 6 ton GVW truck manufactured at its state of the art plant at
Pithampur, Indore in collaboration with Mitsubishi Motors Corporation, Japan, in
1986. The maiden offering soon created a strong customer base for itself.
From a single 6 Ton GVW truck in 1986, our range today extends from 5T to 16T
GVW trucks and the Skyline and Voila range of Buses. All our products can be
offered in BS II compatible options. We also have arguably the best CNG
technology in the world in our CNG Buses. Pioneering the concept of Built Up
vehicles in the country, we make products that consistently deliver high value to our
customers and are increasingly becoming the preferred option for all CV users, not
only in India but overseas too. Eicher CVs today have significant presence in more
than 20 countries across the world.
In India, Eicher Motors has consistently outperformed the industry in terms of
growth and currently holds over 30% market share in the 6T-11T GVW segments.
In the 9T GVW segment, Eicher Motors continues to be the leader with more than
50% market share. Our well-equipped workshops result in faster turnaround of
service. A network of more than 4500 Eicher trained private mechanics, over 133
authorized sales and service centres, and easy availability of genuine parts across
more than 300 authorized spares outlets means less downtime and increased
opportunities for our customers to earn.
Eicher Motors is now poised to further consolidate its position in the CV industry by
entering into the Medium & Heavy Commercial Vehicle segments. Strategic plans
are in place to ensure necessary investments in technology and training to
constantly sharpen our development and manufacturing edge. EML is totally
committed to fulfilling the vision of being one of the top 3 CV manufacturers in the
country by giving customers what they want: vehicles that are safe, fuel efficient,
easy to maintain, enhance driver comfort and in turn productivity. Vehicles that
deliver value by providing low cost of ownership and increased profitability to our
customers.
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Eicher has over 5000 employees located in 10 manufacturing facilities and 24
marketing offices all around the country. The Group has around 950 vendors
supplying components and sub-assemblies which testify to the strength of the
vendor base. The Group's products are brought to the customer through its network
of around 800 dealers distributed across the length and breadth of the country.
THE EML ADVANTAGE
-Technological Expertise
-Extensive Network
-Customized Applications
-Efficient cost of ownership
-Exports
-Vehicle Financing
Technological Expertise
EML products are manufactured at the Company's plant in Pithampur, near Indore,
Madhya Pradesh, India. The company has absorbed the technology and has
successfully indigenised the vehicles.
To ensure that we continue to create products that offer unique advantages and
benefits to our customers, Eicher Motors Limited has set up a Product
Development group, consisting of competent engineers. The team has developed
several successful vehicles and variants, an achievement made possible by the
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use of the latest Computer Aided Design and Computer Aided Engineering (CAD-
CAE) software like NASTRAN and FEM analysis packages.
Extensive Network
Eicher Motors Limited provides its customers the benefit of an extensive sales and
service network, customised solutions and an efficient cost of ownership.
Our manufacturing capabilities are backed by a sales and service network of over
133 EML authorised sales & service centers and more than 300 authorised spares
outlets.
The three-tier service network consists of:
• Authorised distributors in metros and cities.
• 133 Authorised Service Centre's.
• Over 4500 company trained private mechanics.
Service highlights:
• Eicher Genuine Spares - available across all Eicher dealerships, service
centres, spares distributors, satellite service outlets and retail outlets.300
authorized spares outlets throughout the country.
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• A strong and wide dealer network
• Grass-root level penetration through training to popular local mechanics,
currently numbering over 4500 nationwide.
• Fully equipped modern workshops for fast and experienced service.
• Driver-Safety training programmes for drivers of corporate and institutional
customers.
• Free vehicle check-up camps, organised regionally.
• A Comprehensive Service Audit System, which oversees the physical
infrastructure, ensures understanding and compliance with the system
and provides training and technical updates.
Customized Applications
Eicher specializes in offering ready-to-use custom-built application vehicles to
suit customer needs, in addition to the normal range of vehicles. Adaptation of
product specifications to suit local regulations and norms is an integral part of
the process.
All Eicher exports to the Middle East meet Gulf Council Countries(GCC)
specifications, have power steering and air-conditioned cabins. A
breakthrough in our record as solution providers came when Eicher
developed a cargo deck of a composite material of Wood and Steel, called 16
Met wood. Met wood is lighter and more elegant, and vehicles fitted with
these have more load capacity and yield higher fuel efficiency. We also
specially manufacture Commuter and Tourist Buses suited for African
markets. Our Commuter buses are designed for larger passenger carrying
capacities and to withstand tough road conditions.
Efficient Cost of Ownership
Eicher vehicles not only prove to be safe but also a profitable business
investment. This is a result of the engineering, maintenance and safety
features built-into each Eicher vehicle. We call this the efficient cost of
ownership of an Eicher vehicle.
Some of the highlights are:
• A Tilt able Cab for easy reach during routine and periodic service
check-ups.
• An Automated Exhaust Braking system that activates the brakes
automatically on deceleration, allowing for more driver control.
• A collapsible steering wheel.
• Adjustable seats for ergonomic comfort, thus reducing road fatigue.
• An aerodynamic design and a highly fuel efficient engine, that make it
the most fuel efficient vehicle in its class.
Exports
Eicher Motors markets its range of Commercial Vehicles and customized
applications to over 28 countries across the world.
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Vehicle Financing
Eicher has arrangements with a number of key Non Banking Financial
Companies and Financial Institutions to help our customers to avail finance
for the purchase of vehicles. Eicher also provides customer finance through
Auto Finance Company, a division of EML.
Eicher Motors Limited
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EICHER COMMERCIAL VEHICLES
The Commercial vehicle division was established in 1986 in collaboration with
Mitsubishi Motors Japan and is one of the leading manufacturers of commercial
vehicles in India having capacity of manufacturing 38,000 Commercial vehicles.
The Product range includes 5 ton, 7 ton, 9 ton, 11 ton, 16 ton & 25 ton GVW
categories trucks, tipper, trailers; Bus range includes City buses, School bus, luxury
coach, Intercity CWC, Nova 200; Ready-To-Use application vehicles - Around 85
RTU built vehicles to suit a diverse range of applications.
The manufacturing plant equipped with state-of-art facilities with stringent quality
control norms - practices like Kaizen, Just-in-time, TQM and TQC etc. and State of
the art R&D set up helping the commercial vehicles unit to serve their customers
better.
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Diagram showing diversifications in various fields by Eicher Motors Limited with their percentage and capital distribution.
EICHER’S CV BUSINESS
Eicher is the third largest player in the Indian Commercial Vehicles market:
– It leads in the LCV segment with 27% market share in domestic 5-12T cargo
segment in FY 07.
– It is gaining momentum in the HCV segment with successful launch of 16T, 25T,
Tipper and Passenger segments and 1.8% domestic cargo market share in FY 07
implying a growth of 32.9% in sales volume over FY 06.
Eicher’s CV business is well positioned to tap the incumbent growth in the CV
industry owing to its:
–Established track record and stronghold in LCV segment
–Strong brand equity, an established Marketing and Distribution Network and cost
competitive R&D and manufacturing base providing a ready platform for foray in
HCV segment.
Eicher – the third largest player in the industry – is well set to leverage its dominant
presence in LCV segment to gain significant market share in the fast growing HCV
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Segment
With the introduction of new products and upgrading of existing products across the
range, Eicher poised for higher volumes.
EICHER CV BUSINESS – AN OUTLOOK
Industry on Fast Track
• CV industry (5T & above) has grown by 25.4% with 355,761 vehicle s sold in FY 07 over last year.
• Improving road infrastructure creating market opportunities for high performance products.
Strong Position in LCV Segment
• Strong position in LCV segment with market share of 27% in 5 -12T domestic cargo
segment.
• Absence from Sub 5T category leaves significant room for further expanding the product portfolio.
• Established track record and Brand Equity, recognized for superior product quality/specifications.
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Ready Platform for Successful HCV Foray
• Successfully launched 16T, 25T, Tipper and Passenger segments with an
indigenously designed product range.
• Various success stories in segments and geographies, that would be replicated
pan-India with expanding sales & marketing infrastructure and focused marketing
push.
• New products on the verge of being launched, providing significant opportunity to
capture wider spectrum of the market and expanding customer segments.
• Incumbent Brand Equity to facilitate successful foray into lucrative HCV market.
Sales and Marketing Infrastructure
• Strong dealer network in West, Central and South India
• Strengthening the dealership network, primarily to increase geographical coverage
• Sales & Marketing setup was historically more focused on LCV. Significant
progress made to gear up the same to cater to HCV segment.
Low Cost Manufacturing and Product Development
• Established R&D infrastructure and proven skill set.
• Proven capability to develop new products in short timeframe and at minimal development cost, giving crucial time to market and cost advantage.
• Constantly evolving supply chain management with robust supplier base.
• Optimized manufacturing set-up with a good mix of “Make and Buy”.
Management and Engineering Skill Set
• Qualified and motivated management with established track record of change
management, business integration and new product development.
• Strong engineering and product development skills.
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Product Range of Eicher Motors Ltd.
LEADING THE WAY TO Profitability
Leveraging 25 years of local presence and international Partnerships to drive
Modernization in the Indian transportation industry.
Trucks Buses Special Applications Non-Automotive Engines
The Eicher range of Buses & Chassis is a contemporary offering of superior vehicle
performance with safety features, superior comfort and redefined styling. The range
comprises of:
Buses
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Eicher Offers a wide range of options in the Buses. There are two range of Built up
buses - Skyline & Starline with a seating capacity starting from 16 seater till 65
seater. As per the requirement of the customers, Eicher also offers a wide range of
chassis starting from a 12 seater capacity till the 65 seater Capacity. Eicher buses
are trusted by the customers for the best in class fuel efficiency.
School Buses
Eicher introduced “SKYLINE - The First Safe School Bus” in India, developed in
association with IRTE (Institute of Road Traffic Education) in the year 1996, thereby
pioneering the concept of School Bus. The school bus specific features have now
become a norm in the industry. Apart from being safest the popular Skyline school
bus is now available in enhanced features, superior aesthetics & increased
passenger comfort.
\
Staff Buses
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Eicher Skyline has made staff commutation as comfortable as it can be. Aesthetic
superiority, high passenger comfort & Economical performance has made this bus
class apart. The faith of customers & industry is reflected with the fact that Skyline
Executive was awarded with CV-Apollo Award 2010 for “LCV" Bus of the year.
City Buses
The latest offering from Eicher - the Rear Engine Semi Low Floor (RESLF) bus has
been developed in line with the guidelines laid down by the Ministry of Urban
Development as applicable to Mass Urban Transportation needs. This offering has
been received with lot of optimism & excitement by various State Transport
Undertakings, City Administrations and Municipal Bodies across India. Eicher also
offers a wide range of products in the Mini, Midi and Heavy buses for City Bus
Deployment. The products have been designed to suit the frequent start-stop duty
cycle of intra city operations.
•
Route Permit Buses
25
Eicher Offers a wide range of chassis for Route permit (Stage Carriage)
deployments. Eicher products are well suited for the unique requirement of the route
permit application, which necessitates a frequent start-stop operation, overload and
rugged usage.
Trucks
Eicher manufactures a range of Haulage (5 T- 31T), Tipper (8T to 25T), Articulated
Tractor (40 T) and Special Applications trucks.
Eicher Trucks are built to deliver low ‘Total Cost-of-Ownership’. The Eicher haulage
trucks’ range includes the E2 Plus series of 5T-13T Light & Medium Duty Trucks
(LMD) – tagged as “Mileage KaBadshah” and VE Series of Fuel efficient Heavy Duty
Trucks (HD) of 16T-31T. Designed for superior performance with better fuel
economy, higher rated payload and faster turnaround these trucks have low
operating cost and, high reliability leading to higher profits.
Tipper
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Eicher Terra series of 16T & 25T offer enhanced value to customers in areas which
are critical to a tipper operating economics. The USP of Eicher Tippers is their better
uptime and pulling power, stronger aggregates, and the ability to run more number of
trips. Terra tippers offer enhanced benefits which accrues from the results of
extensive research done by the company in the market understanding of the usage
pattern and various duty cycle of its operation. The range makes a significant and
positive effect on the operators’ productivity and profitability by offering better fuel
economy.
•
Articulated Tractor
Eicher 40.40 (Articulated Tractor) from the VE series is built to “Deliver More!” Fitted
with Cummins Engine of 132.5 Kw, Max Torque of 650 Nm and the ET-80 gear box,
the optimized power and torque benefits come along with the High Fuel Efficiency,
stronger aggregates which offer high reliability and durability. The soft suspended
Cabin offers higher driving comfort which means faster turnaround and more trips
leading to higher revenues. .
Special Applications
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Eicher produces an efficient range of Special Application trucks which have been
envisioned and developed to suit the specific requirements of:
Special Applications
Eicher produces an efficient range of Special Application Vehicles which are used as
for various applications as Troop Carriers, Garbage Tippers, Water Containers, Mild
Steel Container & Ambulances.
Eicher Ambulance is a state of art van with all facilities pertaining for an emergency
medical vehicle. Vehicle is equipped with on board equipments not just for safe and
swift transfer of patients but also for providing emergency medical aid.
Mild Steel Container
Ready to use from day 1, Eicher MS container options are unique with respect to fine
engineering design and flexibility requirements. Engineered design, Fine workmen-
ship and rugged but light in weight are few features of Eicher containers offered with
18 months of warranty on container.
Troop Carrier
Its about Determination and Conquering the spirit, Eicher vehicles deliver on these.28
Water Tanker
Low operating cost, efficient and durable water tankers. Fully built Water Tankers
options available in 3.5 KL, 5KL, 6KL & 9KL
29
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32
s
About Volvo Eicher collaboration
33
Company Profile: -
VE COMMERCIAL VEHICLES manufactures a range of commercial vehicles with
GVW of 5 to 11 tons. It has been outperforming the industry for the past six years.
The sales growth in its LCV segment has been higher than that of the industry. In
technical and financial collaboration with Mitsubishi Motors Corporation of Japan,
EML started manufacturing the CANTER range of vehicles in 1986 at its plant at
Pithampur in Central India. The plant is a "state-of-the-art" facility with an integrated
capacity of around 20000 vehicles per annum.
Basic Information
Company Name: VE Commercial Vehicles Ltd. (A Volvo Group and Eicher Motors joint venture)
Business Type: ManufacturerEicher Sells: Gears, Gearbox, Transmission, Agriculture Gearbox,
Planetary Gearbox, Axle, PTO Gearbox, Worm Gearbox Eicher Buys: forgings, Gear Cutters Address: S.V.Road Number of Employees: Above 1000 PeopleYear Established: 1971Main Markets: 1. South America 2. Eastern Asia. 3. Southeast Asia . 4. Africa. . 5. North AmericaTotal Annual Sales Above US$100 Million Factory Information Management Certification: ISO 9001:2008 ISO/TS 16949 Contract Manufacturing: OEM Service Offered Design Service Offered Buyer
Overview
34
VE Commercial Vehicles Limited is a 50:50 joint venture between the Volvo Group
(Volvo) and Eicher Motors Limited (EML). It is a partnership that brings together
Global leadership in technology, quality, safety and environmental care, along with
the deep knowledge and understanding of the Indian Commercial Vehicle (CV)
market. VE Commercial Vehicles Ltd. (VECV) owes its inception to the compelling
intent of driving modernization in commercial transportation, in India and other
developing markets.
Key Facts
VE Commercial Vehicles Limited (VECV) is a 50:50 joint venture between the Volvo
Group and Eicher Motors Limited, and is headquartered at New Delhi. This joint
venture came into effect in July 2008.
VECV is a leading full-range commercial vehicle player in India.
ETB, completed 25 years of operations in India in the month of June 2011. The first
Eicher truck was rolled out from its manufacturing plant in Pithampur, Madhya
Pradesh in 1986 and over the past 25 years, the products have got endorsement
from happy customers of over 300,000 vehicles.
Dec 2007: Signing of Letter of Intent
Dec 2007: Signing of Letter of Intent
Jan 2010: Launch of VE-series of Eicher HD trucks
Jan 2010: Launch of VE-series of Eicher HD trucks
Volvo Trucks India: Sales and after sales support of Volvo trucks in India:
35
Volvo Trucks in India is synonymous with the mining and the construction industries.
They have been tried and tested for operations in extreme conditions, reliable and
robust performance and maximum productivity. Over the years Volvo Trucks has
built up an elite customer base having over 100 vehicles in their fleet operating at
various mining sites across India. The customers vouch by the high reliability and
productivity and have expanded business operations at a fast pace with quick return
on investments. Being the customer’s best business partner, Volvo Trucks extend
support to customers’ right through the life-cycle of the products with a wide network
of service and parts centres and on site assistance.
Eicher Trucks and Buses (ETB) has a strong presence in the L/MD segment with a
dominant share in the 5T-12T truck segment. Eicher’s 21-69 seater buses have a
growing presence in the LD school bus, staff and route-permit segments. ETB has
also made strong inroads into heavy-duty trucks segment of 16T-40T with their “VE”
series of Fuel Efficient heavy-duty trucks.
Eicher Engineering Components (EEC), the automotive component division of
VECV,came into existence in 1992.
Eicher Engineering Solutions (EES) was set up in 1997, as a center of excellence to
provide design, development and consulting expertise in the field of engineering
services. It has two main business areas – EES Inc. (US) and EES Gurgaon (Delhi).
The state-of-the-art plant in Pithampur has access to top line manufacturing
processes which includes cab weld shop with robotic welding, CED paint shop,
integrated testing facilities, 100% hot test facility for engines and a lean and scalable
manufacturing set up. The plant has an annual production capacity of 48,000 units.
In 2010, in a global first initiative, VECV announced an investment of 2,880MINR
(million Indian rupees) in its Pithampur plant for the production and final assembly of
the Volvo Group’s new global VE Powertrain.
The manufacturing set up in Thane houses state-of-the-art machines which include
Gleason Conifex machines for straight bevel gear, Pfauter, Liebherr, Mitsubishi
36
(CNC) and Cleveland Hobbing machines, latest heat treatment facilities and CNC
bore and Cylindrical grinding machines.
The Plant in Dewas, Madhya Pradesh houses technologically advanced machines
and equipment which includes a battery of Mitsubishi CNC Hobbing machines, fellow
shaping machines, Reishauer Gear Grinder RZ400, Shaving Cutter Re-sharpening
machine from Gleason Hurth, state-of-the-art Continuous Gas Carburising Furnace
(from Aichelin) – fully PLC controlled with robotics for Press Quenching and PLC
Controlled Sealed Quench Furnaces (with hot oil quenching for reduced distortions).
VECV has over 3000 employees across its different divisions in India.
Vision & Mission
Vision
To be recognised as the industry leader driving modernization in commercial
transportation in India and the developing world.
Mission
VECV aims to continuously improve transportation efficiency in India and developing
markets, thereby reducing logistics costs for goods and people – leading to higher
enablement of specialization in manufacturing, agriculture and services, thereby
increasing the nation’s economic activity and productivity.
We choose to do this in a sustainable manner by having the safest, most durable
and efficient products in the market;
We care for our customers holistically by offering not just trucks and buses, but
also the best service and soft products to enable him to be most profitable;
We work with the driver community to enhance their productivity and overall
working environment;
We ensure a level of quality and innovation that will continue to set standards in the
commercial transportation industry;
Going Forward
VECV aims to emerge as an Industry leader in driving modernization in commercial
37
vehicle transportation in India and the developing world by bring about improvement
in transport efficiencies.
In the near course, VECV will strengthen each of its product brands as leaders in
their respective segment through innovative products and expansion of its existing
network spanning the geographical expanse of the country.
Company description
VE Commercial Vehicles Limited owes its inception to the compelling intent of driving
modernization in commercial transportation, in India and other developing markets.
As a 5050 joint venture between the Volvo Group (Volvo) and Eicher Motors Limited
(EML), VE Commercial Vehicles (VECV) incorporates unique abilities to be able to
do so. The organization brings together global leadership in technology along with
deep knowledge and experience of the Indian commercial vehicle (CV) market.
As a company, VECV includes the complete range of Eichers commercial vehicles,
components and engineering design businesses as well as the sales and distribution
of Volvo trucks. Thus, each of its business units is already well-established and
backed by a sizable customer base.
VECVs portfolio of commercial vehicles includes two product brands with absolutely
different market positions yet complementing segment synergies. Eicher Trucks &
Buses have a wide offering in the mass market, 5T40T range while Volvo Trucks
command a strong presence in the premium, high-performance, heavy duty
segments from 25T49T. With a formidable presence in the existing light and medium
duty segments, VECVs main focus is on increasing the penetration and market
share of its heavy duty products. Thus, its investments in design, development,
manufacturing, systems, distribution and services are largely oriented towards
creating a stronger position in the heavy duty market.
VECV is going all-out to gear itself in becoming a proactive solutions and service
provider meeting all customer needs. This it will do by strengthening each of its
product brands as leaders in their respective segments. In the near course, VECV
will offer an even more innovative line-up of technologically advanced and
ergonomically aesthetic products. Volvos widespread distribution network will
38
facilitate the export of these products to countries world over and will help VECV
bolster its presence in more than 26 countries to where it currently exports. With an
improved thrust on retail network development and after sales service, VECV will
soon come to be recognized as a lean organization capable of setting new
benchmarks in response times.
It is important for VECV, that its growth must also have a positive influence on the
industry it serves; ensuring that the industry becomes more efficient, environment
friendly, offers safer products and manufactures products that are driver friendly. And
this dictum of being the differentiator not only reflects in VECVs approach in the
market place but also in its internal workplace moving it to becoming a preferred
employer in the industry.
VE Commercial Vehicles has over 4000 employees with a sales & support network
that spreads across more than 300 points across the country. Companies industrial
base includes an integrated commercial vehicle factory in Pithampur producing
Eicher trucks & buses along with factories in Thane, Gurgoan and Dewas dedicated
to manufacturing gear boxes and gear box assemblies.
VECV is jointly managed by Volvo and EML with shared management and equal
representation rights on the board of Directors. All management positions are
appointed by the board. Mr. Par Ostberg (Chairman, Trucks Asia, Volvo Group) is
VECVs chairperson while Mr. Siddhartha Lal is the Managing Director and CEO.
Operational since July 2008, VE Commercial Vehicles is headquartered at New
Delhi
Business areas of Volvo Eicher Motors Limited
Eicher Motors Limited comprises of the automotive businesses of the Eicher Group .
39
The business activities of the company are carried out by its constituent Business
Units, each covering a product category as described below.
Business Area Products
VE Commercial Vehicles Ltd - Eicher Trucks & Buses, Volvo Trucks, Gears & Shafts
Motorcycles - Royal Enfield
VE COMMERCIAL VEHICLES LTD
It manufactures a range of commercial vehicles with GVW of 5 to 11 tons. It has
been outperforming the industry for the past six years. The sales growth in its LCV
segment has been higher than that of the industry. In technical and financial
collaboration with Mitsubishi Motors Corporation of Japan, EML started
manufacturing the CANTER range of vehicles in 1986 at its plant at Pithampur in
Central India. The plant is a "state-of-the-art" facility with an integrated capacity of
around 20000 vehicles per annum.
ROYAL ENFIELD
Royal Enfield, manufacturers of the renowned range of Bullet motorcycles, has
pioneered manufacture of motorcycles in India. It has a wide range of high powered
bikes in its stable to deliver a ‘unique motorcycling experience’ to its rider. Presently
Royal Enfield is producing six different models ranging from 300cc to 600cc.All the
products are manufactured indigenously in its manufacturing plant in Chennai, which
has an annual installed capacity of manufacturing 39,000 motorcycles.
40
MARKET MAPPING OF EICHER
MOTORS
Market mapping
Market mapping is used in market segmentation to help companies identify the
target group(s) for segmenting and forms the second step in the segmentation
41
process. It also has a number of other important applications, such as tracking
changes in the channels to market, presenting your own company's performance on
these routes to market and illustrating where your sales and marketing resources are
allocated, which can then be compared with how your key competitors allocate their
resources.
You may discover that a lot of the buying decisions are actually so highly influenced
by intermediaries in the map, that those intermediaries effectively 'own' a large
percentage of the buying decisions. Besides being a key step in the segmentation
process, it can be become apparent that two marketing plans will be required. A
'push' plan which is about improving the way we satisfy the benefits sought by those
intermediaries, and a 'pull' plan which is about better addressing the benefits sought
by the 'consuming' end segments.
A slightly cynical example makes the point. Who can doubt that the Consultants and
System Integrators recommendations hold huge sway with the purchase decision of
a CIO/IT Director. Does anybody doubt that that SAP became the ERP system of
choice partly because it was in the interests of the SIs that it did so?
Definition
A definition favoured by some of my colleagues is as follows:
A market map defines the distribution and value added chain between final users
and suppliers, which takes into account the various buying mechanisms found in a
market, including the part played by ‘influencers’.
This is OK, but I believe causes someone new to the segmentation process to
assume a market map is the same as a physical distribution chain, or a value chain.
This can be partly true but is not necessarily the case.
For me, a better definition is as follows:
42
The primary purpose of a market map is to describe the flow and relationship
between Influencers ‘and Decision Makers between suppliers and final users (as
Decision Makers) whilst noting the channels used.
Market Mapping
To make the best use of your sales and marketing budget, knowing who you are
selling too and how to reach them is critical. Commerce intelligence group research
and define the distribution and value chain between supplier and final user, taking
into account the various buying mechanisms found in a market, including the critical
part played by relationships and 'influencers'.
Our market mapping process allows you to focus attention on key decision makers
within a market, and identify key target market segments. Consequently sales
channels and the key players within channels can be easily identified with the help of
a graphic presentation of a market.
This market map can help deliver key customer and consumer insights, and ensures
you have a full awareness of the total market place and how best to utilize your
resources.
About Market Mapping
Market Mapping takes a strategic, forward-looking approach to crafting market
driven strategy and segmentation, focusing on where customers are going, instead
of where they've been In addition, the Market Mapping process goes well beyond
simply gathering and reporting market data by providing a collaborative, team-based
process for bridging the gap between information and action. Market Mapping is an
ideal complement to a Future Mapping scenario planning exercise. In the same way
that scenarios help leadership teams develop and align around a common view of
the future, Market Mapping addresses alignment with customers
Market Mapping Applications
43
„ Market Mapping can help leadership teams address issues like these: We have a
vision of the future but we’re not sure whether our customers share it We think we
know the best way to segment our market but we couldbe wrong We simply don't
know our customers well enough to understand where they are going We’re not
sure which new products or services they will want in the future, or how they’ll want
to buy them We think the decision process for our products/services will change but
we're not sure how We expect consolidation in the industry and in our markets but
we’re not sure how that will affect our competitive position We can't agree on how we
should differentiate ourselves from our competitors or on our best opportunities for
growth and profitability
Key Steps in Market Mapping
„ No matter how much quantitative data an or ganization has in hand, it is critical for
them to understand the underlying thought proc ess of the end user and decision
maker; their wants, needs and values; the way they evaluate products. Once they
understand how customers think about the future, management will be in a position
to deliver true solutions. At it’s best, this is the threshold of discovery leading to a
breakthrough idea. Market Mapping has been specifically designed for leadership
teams, providing them with both qualitative and quantitative views of customer
thinking, integrated into working hypotheses that can provide bridges to action.
„ A typical Market Mapping project has the following steps:
„ 1.Conventional Wisdom” Debrief
„ 3.External Interviews
„ 4. Data Synthesis and Analysis
„ 5. Strategy Workshop
Conventional Wisdom Debrief of Eicher motors
44
„ This establishes the starting point for the project by identifying the set of critical
uncertainties and assumptions about the future of the market environment held by
the leadership team and key internal stakeholders Through a series of interviews
and/or a structured workshop, we gather input from questions like
1. Which customers are critical to your future success?
Ans. Jaipur market have a large number of potential customers. Presence of good
number of educational institutes and transport companies is an proof of its potential.
Educational institutes are the major customers for Buses and transport companies
are for trucks and hence these are the critical sector for the eicher commercial
vehicle.
2. How are these customers evolving their business model?
Ans. Customer are continuously demanding for effective and efficient products
according to their requirement.
3. What kinds of problems do you think these customers are trying to solve with
products and services like yours?
Ans . Current customers of eicher trucks are aspiring for :-
Overloading ability
Solution of frequent maintenance problem
Easy accessibility to spare parts
Workshops in jaipur area.
4. What baseline “minimum acceptable” criteria do you think these customers
use to evaluate potential suppliers and their solutions to these problems?
Ans. Basically a customer looks for the following things in a truck bus or other
applications
45
Bus
Model Wheelbase (mm)Overall Length (mm)Rear Overhang (mm) Front Overhang (mm)Overall width (mm) Internal heightSteeringBrakesNo. of seatsType Of SeatsEngine – TypeEngine - Max PowerEngine - Max Torque
Trucks
Wheelbase Options (mm)Cargo body Deck Length (FT) Overall Length (mm)Minimum Turning Radius (m)Ground Clearance (mm)Gross Vehicle Weight (kgs)Payload (kgs)Engine TypeEngine performance Max. PowerMax. TorqueBore x Stroke (mm)ClutchGear BoxRear AxleFront AxleTrailing AxleSteering
46
Frame
5. Which attributes do you think will differentiate suppliers from each other and
drive the choice of products and services in the future?
Ans. Some of the Eicher trucks and buses seems better in
1. Mileage 2.Fast Trip 3.Accerlaratin 3.Space in the containers(truck)
4.Average
6. When Market Mapping is used in conjunction with a Future Mapping session,
the outputs from the first phase form the basis for the strategic choices
considered in the second phase
Data Analysis and Reporting
Market Mapping results are best presented inter actively, usually in the context of a
collaborative workshop. Data is analyze d and reported in three dimensions:
quantitative, qualitative and working hypotheses. If conflicting ideas are present, they
are offered as counter arguments. Leadership teams that are comfortable with idea
conflict usually respect the results mo re if alternative opinions are evaluated and
considered.
47
The Market Value Process
Market Value Partners help organizations build and sustain competitive market
advantage. Using the Market Value Process we provide organizations with a proven
methodology for rigorous market analysis. This results in a clear and actionable
market strategy.
The Concepts Behind "The Market Value Process"
Market Value Partners believe that to truly create superior shareholder value it is
important for an organization to precisely define and focus on superior value to
customer in chosen market segments.
• The Eicher motors "Market Value Process" is further can be used used to
analytically examine its product and services offerings, enabling it to make
critical strategic and tactical marketing decisions that will improve its market
position.
• To "manage superior customer and shareholder value" the "Market Value
Process" gives organizations methodologies to fully examine the required
product(s), non-product(s), and pricing appropriate for chosen market
segments:
o Product (Product features, product performance, reliability, ease of
use)
o Non-Product (Consultative selling, brand awareness, support, etc.)
48
o Pricing (Price per user, Total Cost of Ownership)
• The Market Value Process is a technique to:
1. Focus
2. Map
3. Measure
a company's ability to meet the selected market needs relative to the competition
under various market scenarios.
The Value of Market Maps
Developing a market strategy via the "Market Value Process" provides an analytical
approach for measuring market opportunities and challenges. Without this analytical
approach, concepts such as customer value become extremely fuzzy. In contrast,
the visual impact of the 'Market Value Maps' gives an organization a record of their
market value-creation decisions along with valuable market insights.
The Theory Behind A Successful Market Strategy Process
Step 1: Define Your Market(s)
A company wins customers by creatively identifying differences in particular type of
customers' needs (price, product, and non-product needs). Recognizing the different
discreet needs of different customers is the first step towards delineating different
market sectors. This will enables an organization to stake claim on the most lucrative
sectors of the market, matching corporate capabilities to the market requirements.
This provides the logistical focus for marketing program execution.
A significant amount of effort is be spent in examining the chosen market definitions.
It's not wise to short-change the amount of time spent on creative market
segmentation. All too often organizations keep this effort brief and perfunctory. This
is probably because the imaginative process of defining markets is sometimes
perceived as frustrating. There is sometimes a feeling that organizations are
thrashing and not necessarily getting anywhere. This is deceptive. The reality is that
this is some of the most important "Marketing Work" an organization can do if the
49
result is a strong and creative market segmentation that leads to successful
marketing program direction and subsequent market share gain.
Because strategies uniquely deliver value to specific markets, getting market
definition wrong means getting everything else in the process misdirected.
Q. Who are the customers of commercial vehicles.
Ans. Mainly the customers of commercial vehicles are:-
1. Transport companies 2.Hospitles 3.Individuals
4. Educational institutes 5.Government agencies
Step 2: Envision Market Evolution with Scenarios
Once an organization has defined its markets by uncovering differences in price,
product and non-product needs, the next issue is to envision how these markets will
evolve over time. To do this, the organization should create scenarios that help the
organization imagine the different ways in which key trends may unfold. Looking at
various market evolutionary possibilities is far richer than relying on a detailed
forecast for a single "official future" that reflects an organization's traditional thinking
and become obsolete or unlikely before the ink is dry on the business plan. With
MVP's value maps, the scenarios are dynamic, easily updated, and flexible, so that
your plan never ends up on the bookshelf. These scenarios enable an organization
to think about how the price, product, and non-product sensitivities in the chosen
markets may potentially evolve.
In coming up with market scenarios, the organization should first determine the
greatest uncertainty that the market faces (whether competitive or environmental).
Often the greatest uncertainty is the future "quality-sensitivity" of the market (i.e. the
slope of the 'market wants' line - please see the charts attached below as reference). 50
The organization then needs to identify the drivers of this uncertainty. In the case of
the quality sensitive market, the driver is the timing, source, and magnitude of the
next major breakthrough that improves the innovating company's market share.
Successful organizations envision alternative futures and have a strategic response
ready to meet whatever future actually materializes.
Demand drivers
Freight outlook- CV sales have a direct correlation with the state of the freight
industry, with growth in CV sales (MHCV trucks) closely tracking increase in freight
movements. Strong economic activity in the country, especially in sectors like
cement, mining, steel production, automobiles, consumer durables, food processing
and food grain production, leads to increased demand for freight movement by road.
Freight rates and fuel price- Truck operators’ profitability is most sensitive to freight
rates and fuel prices (60-65% of the total cost). With other things remaining constant,
operator profit before depreciation and tax rises 6.5% with a 1% rise in freight rates
and 3.5% for a 1% decline in fuel prices Policy initiatives- The CV industry has
benefited from regulations like discouraging the use of old, polluting and
Uneconomical vehicles. The Supreme Court ban on overloading has also been very
positive, leading to incremental Volumes in the last two years. Further any
government’s likely policy initiatives like scrapping vehicles more than 15 Years old
can potentially unleash a huge replacement demand. Further the industry is also
expected to benefit from the proposed phase-out of Central sales Tax by 2010.
Replacement cycle- Replacement cycle for trucks has been shrinking, declining from
about 12 years to nearly seven years now. The proportion of trucks under five years
of age rose from about 34% in FY02 to nearly 45%.
Competition from Indian Railways- Road transport competes with the Indian
Railways (IR) for transportation of all major commodities, with roads having an edge
51
in transportation of non-bulk commodities owing to point to point delivery with
railways commanding a higher share in transportation of bulk commodities. Over the
years, roads have gained an increasing preference vis-à-vis the railways and the
share of road transport currently stands at about 65%.Demand supply scenario- The
significant part of the demand for new trucks comes from capacity additions by small
fleet operators and first-time users. This along with policy changes like ban on
overloading has led to significant addition in the truck population. Also with easy
availability of finance at low interest rate helped in increase of capacity in the past
five years. But as interest rates are set to increase it might lead to slight dampening
in demand for M&HCV in near future. However, demand is likely to remain healthy
for LCV owing to the rise in demand for small commercial vehicle for providing the
last mile connectivity and the creation of hub and spoke models.
Step 3: Determine Whether a Particular Market Will Reward Your
Specific Investment
THE degree to which a market is attractive and promises to reward an investment
depends on the fit between the direction the market is headed and the organization's
core competencies. This process also helps an organization prioritize the markets for
investment.
Step 4: Deliver Quality Through Product and Non-Product Benefits
The Market Value Process is used to measure and map how an organization's
customers perceive its quality relative to the competition's quality. Quality is defined
as the precision with which the product meets the customer's product needs. Quality
is the "basket of needs", product and non-product. We consider both the product and
non-product dimensions of quality in detail. We will work with the extended
management team to measure and map the relative quality an organization offers in
each chosen market.
Defining Market Objectives and Developing Marketing Strategies
In developing a strategy for a particular market, an organization identifies several
possible objectives for its position in that particular market. The obvious possibilities
52
are to gain, or hold market shares. Each objective is usually associated with a
particular level of investment in human and capital resources relative to the
competition.
The process enables an organization to build a strategy for deploying the resources
needed to attain the desired objective by market. To gain share an organization
would typically put in motion an aggressive set of actions to improve its product and
non-product quality. The theory is that improved pricing and improved product quality
will offer customers superior value and delivery higher shareholder value to the
vendor.
RESEARCH METHODOLOGY
Introduction
Before undertaking a study, it is useful to plan how it would be done. This involves
designing the research work and its methodology. Research methodology is a
systematic way for solving any research problem. It may be understood as a science
of studying how research is done scientifically. Research methodology has many
dimension and the research methods are an integral part of it. The usefulness of the
output will depend upon how the research has been designed and implemented at
each strong of its process. The project is related to the determination of financial
analysis for the company. The co. comprises many divisions all over India. On the
basis of need for individual division, the financial analysis for the entire organization
is determined.
Research design
The research design is a plan of the proposed research work on the market ground
of Eicher Motors . It is the way through which the stated research objectives can be
achieved. It is a blueprint for the collection, measurement and analysis of the data
that are collected from the market. It means it involves the data collection method,
the specific research instrument and the sampling plan that would be used for the
purpose of market mapping of Eicher motors.
53
Data collection method
There are various methods for the collection of data. However, for the selection of any method, the following factors are considered.
Nature, Objective and scope of the study
Availability of funds
Time element
Accuracy required
Availability of data
Collection of data can be of two types:
Primary data Secondary data
Primary data are those which are collected for the first time from the Jaipur market . This happens to be original in character.
Secondary data are those that have already been collected and analyzed by someone else. The data used in the report is collected from internet, magazines..
For this study I had used primary and secondary data available from the company and various divisions and websites.
Research Objective
The main objective of conducting research is to identify the marketing strength
and weakness of Eicher Motors.
Another objective is to judge profitability and marketing soundness of the Eicher
Motors.
To analyze the soundness of the company with the help of marketing
management tools.
54
To study the trends and reasons for deviation.
Market mapping of Eicher motors
Customer satisfaction level
Market Analysis
Customer Feedback
Competitors
• Tata Motors -Based in Mumbai, India, Tata Motors Limited is a part of Tata
Group. It manufactures commercial and passenger vehicles primarily in India.
It offers passenger cars, multi-utility vehicles, and pick-ups; medium and
heavy commercial vehicles, such as rigid trucks, tractor trailers, and tippers;
intermediate, light, and small commercial trucks; buses; and defense related
vehicles. The company, through its subsidiaries, also provide engineering and
automotive products; manufacture of construction equipment; automotive
vehicle components manufacturing and supply chain activities; and provision
of machine tools and factory automation products, as well as offers high-
precision tooling, and plastic and electronic components for automotive and
computer applications. In addition, it provides automotive retailing and
services, as well as financing for the vehicles sold by the company. The
company markets its products in Europe, Africa, the Middle East, south Asia,
south east Asia, and Australia.[25]
• Mahindra & Mahindra Ltd - The company manufactures a range of
automotive vehicles, agricultural tractors, implements, and industrial engines.
It is also involved in property development and construction activities. The
company offers various multi utility vehicles, light commercial vehicles, three-
wheelers, and tractors as well as spare parts and related services. It also
provides various services related to financing, leasing, and hire purchase of
automobiles and tractors. In addition it also offers design and engineering
services to the automotive, aerospace, and general engineering industries;
and produces automotive components, as well as forgings, gears, steel,
stampings, and special polymers. It is headquartered in Mumbai, India.[26]
55
• Swaraj Mazda (SWARAJMAZD-BY) -Headquartered in Chandigarh, India,
Swaraj Mazda Limited manufactures and sells light commercial vehicles for
goods and passenger applications in India. The company also offers specialty
vehicles, such as ambulances, dumper placers, water tankers, and troop
carriers. In addition, it sells spare parts and scrap. It operates as a subsidiary
of Sumitomo Corporation.[27]
• Force Motors (FORCEMOT-BY) -The Group's principal activity is to
manufacture and market utility and light commercial vehicles, agricultural
tractors and diesel engines. Its plant are located at Bombay Pune road,
Akurdi, Pune and Pithampur, District Dhar, Madhya Pradesh. With technical
collaboration of MAN AG, Germany, Force Motors has a range of heavy
commercial vehicles with a payload capacity ranging from 16 to 50 tonne
Market share
Market share of Light commercial vehicles in India
56
Market share of Medium and Heavy Commercial Vehicles in India
Key Success Factors
Ability to enhance and vary product mix - A diverse and broad product mix enables
a manufacturer to serve a wide variety of transportation solutions across different
load levels. It also helps in building strong brand loyalty among customers. In
addition the presence in business such as auto spares, buses, exports and defence
helps companies to weather the cyclist in CV sales.
Sales and distribution service network - A widespread sales and distribution
setup enables the company to ensure a geographically diversified client
profile.
Access to new technologies – In addition to matching competitor’s new
products and upgraded machinery, technology is also going to be critical with
emission norms are going to be stricter going forward. The requirement of
updated technologies has driven domestic players into
acquisition/collaborations/JVs with global majors.
Balance between outsourcing and in-house production - Companies with high
integration level have higher fixed costs which results in higher profitability in
57
robust growth scenario. However it also results in sharp drop in performance
as they would be affected by lower sales volume backed by Industry cyclical
nature. More over company’s proximity to their raw material and component
suppliers help them in reducing procurement costs.
• Higher steel prices have been a key concern over the last two years. The CV
industry has tackled this both by passing part of the costs through price hikes and
also by optimizing their selling, advertising costs and treasury efficiencies.
• Another concern is a slowdown in the Indian economy. This would lead to lower
investment in infrastructure which in turn will affect the CV demand.
• Higher domestic inflation and increase in fuel prices are other major concerns.
Without a concomitant increase in freight rates increase in fuel price will have a
negative impact on demand for CVs.
Outlook
Although rise in interest rates and fuel price may dampen the growth of the sector in
short run the long-term outlook for the domestic CV industry remains strong. The
expected continuance of economic growth and investments in infrastructure will help
the sector report robust growth going forward. The entry of new players in the
industry and the significant capacity additions expected are however likely to keep
the competitive pressures high. On the demand side, a combination of tightening
regulatory norms (on emissions and vehicle scrapping) and increasing customer
selectivity is expected to drive a shift towards high tonnage quality products. The top
players in the domestic CV industry have robust financials, supported by strong cash
accruals and a comfortable capital structure. These players are capable of funding
their significant investment plans over the medium term without resorting to any large
borrowings. Moreover, the ongoing capacity expansions are based largely on
outsourcing models, which aim at better sharing of risks with component suppliers
and lower the break-even levels. The significant export drives being made by the
leading CV players are likely to lower the risks arising from concentration on the
domestic market and mitigate the impact of cyclical downturns to an extent.
58
Market segmentation
1. Target Market survey
2. Customer Feedback
3. Presentation of analysed data
Overview
Jaipur market has a good number of potential customers for the commercial
vehicles. Main players in the field are TATA Motors, Ashok layland, Eicher Motors,
Mahindra. Mainly the customers to whom we met are Transport companies in Jaipur.
We met around 500 customers of commercial vehicles in the market of Jaipur and
collected the primary data regarding Eicher motors to get the main objective of
“market mapping of Eicher motors.
Market Segmentation:
Different Customers have different and specific types of needs and demands in the
market according to which they acts in the market .Customers need and demand
differs in the sense of sex, age, geographical regions, climatic conditions etc....
For example: - In hilly areas a customer will prefer a bus having powerful engine
rather then having better speed.
Market Segmentation can be defined as similar needs, demands and characteristics
regarding a particular type of product. Selecting any particular type of customers
having Hence to identify a specific group of people having similar characteristics ,
needs and demands at any particular geographical region , market segmentation is
important .It seems much effective technique rather then working randomly for the
identification of the target market.
During this process we identified the market where we can proceed to survey and
can get valuable information from the target market, so that the facts and figures can
be collected and farther can be used for the marketing purpose.
59
Areas which we segmented from the Jaiper market are
1. Transport nagar
2. V.K.I Area
3. Muhana Mandi
4. Automobile Nagar
5. Jalupura
6. Chandi ki Taksal
7. Chotti Choppar
8. Sansarchand road
9. Sindhi Camp
10. Durgapura
Market Survey:
In this field we had collected facts and figures of commercial vehicles in the Market
of Jaipur and make conclusion on the basis of this .
Market explanation:
Transport Nagar
Transport Nagar is widely depressed market for transport companies having a
less number of potential customers of Eicher motors. Companies like Ashock
Layland ,Tata motors dominates in this field .According to survey report Eicher
motors lagging behind because of the following reasons:-
1. Coastally spare parts
2. Lack of authorized workshops of Eicher motors
3. Frequent Maintenance requirement.
4. Resale price is less
Automobile Nagar
60
We had surveyed about 60 companies in the Automobile Nager. There are
potential customers of heavy vehicle, mainly of trucks. But there is a need to grab
the opportunity by Eicher Motors in the market, as the goodwill of the Tata motors in
the market is seems to be better. Customer are mainly focused on or demanding
trucks which can bear overload , fuel efficient ,less maintenance , easy availability of
work shops.
V.K.I industrial area
V.K.I industrial area has a large and scattered type of pattern of transport
companies. According to the market survey it is a bigger market of heavy
commercial vehicles, especially of trucks. A large number of transport companies
locates here and hence plays an important role in the commercial vehicle market of
Jaipur .It includes road number 1 to 15. According to the survey of market, most of
the transport companies owns the Product of Tata and ashock layland and in future
also they interested in the same .Eicher seems to be at back foot because of two
main common reason among all i.e.
1. Eicher Trucks are less able to bear overloading in comparison to Tata and trucks
of Ashock Layland.
2. Having less number of workshops is the Jaipur area is the major drawback.
Muhana Mandi/Sanganer
The transport companies in the Muhana Madi are situated on the basis of
Mandi market .Sabji Mandi of Muhana market always needed transporters to
transport eatable materials. Muhana Mandi is a market of large and heavy as well as
small commercial vehicles. There were customers of trucks but less in numbers.
Some transporters had just purchased the trucks and some are still interested in
purchasing.
Other areas
In other areas of Jaipur like Chand pole, Jalupura, sansar chand Road and Badi
Chopper there is a large number of transport companies situated and hence create a
market for commercial vehicle industry. There are hot as well as cold customers to
whom we meet and get the information regarding their transport vehicle.
61
We collected information regarding the commercial vehicle they owned and vehicle
which they want to buy in the future .we concluded about their reactions and
experiences in the market regarding the commercial vehicles .We come to know that
Tata Motors is in leading role in Jaipur area in trucks and buses. The major reason
behind this success of Tata Motors is customer satisfaction by maintaining quality at
reasonable price.
Customer feedback:-
1. About spare parts : -
- 25 customers had complaint regarding this.
-Spare parts of Eicher trucks and buses are not easily available
-Spare parts are costly
2. About Average and mileage:-
-Eicher Trucks and buses provide better average and mileage
3. Fast Trip, Acceleration and space in containers are the positive points of Eicher trucks
5. Eicher trucks are seems to be best suitable for caring agricultural equipments and machineries.
4. Goodwill.
-EICHER product have goodwill in some areas of jaipur according to our survey.
- Tata is leading in this goodwill factor
5. COST.
-Customers expects better discount from Eicher Motors
-According customers Tata is providing better services to their values spend
6. MAINTENANCE.
- Maintenance required is more than Tata in Eicher trucks.
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7. Service centres:-About 35 customers complained regarding this.
-Lack of service centres of Eicher motors in the area
Table of Survey report of some transport companies for feedback
Customers Costly Spare Parts
Lack of WORKSHOP
Bear less OVERLOADING
ENGINE capacity
FINANCE SCHEME
Rathore transport com.
VRL Logistics
New Golden transport com.
JAIN transport com.
O9New Shekhawati transport com.
Geetangali Tours and Travels
63
Type of Survey in various market of jaipur
Market Description Surveys:
For determining the size and relative share of the market. Such studies provide key
information for determining market growth, competitive positioning and tracking
share of market. The CEO usually wants to know this information. Industry consortia
often commission this type of study.
Q.1. Which Company Vehicle is being used by you ?
(A). TATA Motors(B) Ashok Layland(C) Eicher Motors(D) Mahindra
Eicher
Ashok Leyland
Tata
Mahindra
Eicher 14%
Tata 48% Ashok Leyland 33%
Mahindra 5%
1: Pie chart showing the number of customers of different companies.
Market Profiling–Segmentation Surveys:
Directed at identifying who the customers are, who they are not, and why they are or
are not your customers. This is often a descriptive market segmentation and market
share analysis.
Q.2. Who are the customers of commercial vehicles ?64
Hospital
Educational Institutes
Transport Companies
Farmers
Transport Companies
EducationalInstitute
Hospital
Farmers
2: Pie chart showing customers as organisation .
Stage in the Purchase Process/Tracking Surveys:
Where the customer is along the purchase process. The aggregation of this
information provides information about the diffusion of innovation process for the
market and product as a whole… What are the levels of Awareness–Knowledge–
Intention– Purchase– Repurchase?
Q.3. Did it met all the expectation that you aspired from the product before
purchasing?.
No 58%
NR 15%
Yes 27%
3: Pie chart showing satisfaction level of the customer after purchasing of Eicher commercial products.
Customer Intention–Purchase Analysis Surveys:
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Directed at understanding the current customer. What motivates the customer to
move from interest in the product to actual purchase? Understanding this process
and how it can be improved is the key to customer conversion, commitment, and
loyalty study.
Q.4. Which factor a customer prefers in their Commercial Vehicle Product?
-Mileage-Average-Maintenance-Speed-Wheelbase (mm)-Loading-Steering-Brakes-No. of seats-Type Of Seats-Engine – Type-Engine - Max Power-Engine - Max Torque
Customer Attitudes and Expectations Surveys:
How does the current product meet customer expectations and what attitudes have
customers formed about the product and/or company? Attitudes and expectations
analysis can be used in a variety of situations such as directing advertising and
improving customer conversion, commitment, and loyalty.
Q.5. Did the Eicher motors product met all your expectations which u aspired before purchasing it?
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Eicher
Ashok Leyland
Tata
Mahindra
Eicher 20%
Tata 51% Ashok Leyland 25%
Mahindra 4%
Q.6 Are you satisfied by the product of Eicher motors u purchased
No 58%
NR 15%
Yes 27%
Pie chart showing satisfaction level of Eicher Motors customers
Ans.- (A) Yes - 27% (B) No - 58%
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(C)No Response - 15%
Customer Trust–Loyalty–Retention Analysis Surveys:
Especially appropriate for the study of shopping goods (and other high priced goods)
because of the magnitude of the decision process for the customers, the long
purchase process (time from need recognition to purchase), and depth of consumer
attitudes formed about the product and/or company.
Q.6.Would you recommend eicher product ?
No 35%
Yes 65%
Pie chart showing the trust and loyalty relation with the company
Ans.- 1. Yes - 65% 2. No - 35 %
New Product Concept Analysis Surveys:
Concept test studies are appropriate in the initial screening of new product concepts.
Likes and dislikes about the concept and evaluation of acceptability and likelihood of
purchase are especially useful measures.
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Q.7. What major improvement you like in the product ?
Ans.- 1.Workshops
2. Overload bearing capacity
3. Cheap and easy availability of spare parts
4.Less maintenance
New Product Acceptance and Demand Surveys (Conjoint):
Conjoint analysis studies are implemented primarily for the estimation of demand for
new products. Typically, these products can be described or have been developed in
drawing or concept, but have not yet been developed physically. Conjoint analysis
allows the manager to develop market share estimates to find which of the
alternative potential products offer the greatest market promise.
Q. Which companies product u prefer to buy in the commercial vehicles.(only bus
and truck)
Tata Motors, 60
Ashok Leyland, 20
Eicher Motors, 15
Mahindra, 5
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Pie chart showing the customer preferences in purchasing
commercial vehicles
Ans.1. Tata motors – 60% 2.Ashock laylend – 20% 3.Eicher Motors - 15%
4. Mahindra – 5%
Product Fulfilment Surveys (Attribute, Features, Promised Benefits)
Products contain bundles of benefits (both tangible and image) that are promised to
the user. The product fulfilment study determines if the expectations created for the
product by advertising, packaging, and the produce appearance are fulfilled when
the product is used.
Q. Are u satisfied with the promised benefits with the eicher products.
No 60%Yes 40%
Pie chart showing customer satisfaction with the promised benefits
Ans.- Yes - 40 % No - 60%
Test Market Surveys (Product Use and Acceptability Evaluation)
Test markets are conducted to determine the actual buyer response to a new
product offering. Test market evaluation is most often concerned with evaluation of
the product purchase process, evaluation of the product and marketing materials
used in the test market.
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Q. Grades to the Eicher commercial vehicle products on the basis of overall performance
Grade A, 10
Grade B, 40
Grade C, 30
Grade D, 20
Pie chart showing the grades given to the Eicher Motors on the basis of overall satisfaction
Ans. (a) Grade “A” – 10% (b) Grade “B” – 40% (c) Grade “C” – 30%
(d)Grade “D” – 20%
Brand Equity Analysis Surveys:
Brand equity analysis focuses on the measurement of the psychological value that a
brand carries with it. Brand equity is described in the marketing literature as being a
composite of brand awareness, brand quality, brand associations, and brand loyalty.
Each of these concepts can be measured. There is no formal procedure for
combining all items into a single overall “value” or “score” that measures brand
equity.
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Q. Goodwill of Eicher motors in comparison with its competitors?
Eicher
Ashok Leyland
Tata
Mahindra
Eicher 20%
Tata 50%Ashok Leyland
25%
Mahindra 5%
Pie chart showing the goodwill of eicher motors and its competitors in the market
Sales Force Effectiveness Surveys:
Sales force effectiveness evaluation is a combination of measures that focus on the
activities, the level of performance associated with those activities and the
effectiveness in terms of producing the desired and measurable effect or goal. Often
sales force effectiveness is measured as a multiple part survey completed by the
sales person, the client (evaluating the sales call), and the supervisor responsible for
evaluating the sales person.
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Q. Is your relationship is good with sales department of the eicher motors
YES 70% 70%
NO 25 %
OTHERS 5%
4Pie chart showing customer relationship with the Eicher Motore company.
Sales Lead Generation Surveys:
Sales lead generation surveys are an effective online tool for:-
(1) assuring timely use and follow-up of sales leads,
(2) qualifying sales leads (thereby saving valuable sales force time), and
(3) providing more effective tracking of sales leads.
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Q. Are you satisfied with the delivery services of Eicher motors?
YES 25 %NO 65%
NR 10%
Figure 5: Pie chart showing the satisfaction level of customers regarding delivery services.
Ans- 25% Yes 65% No
10% Others (No response)
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BIBILOGRAPHY
Primary Data:-
Eicher Office
Eicher Customer
Industries & Factory
Educational Institute
Secondary Data:-
1. Eicher broachers
2. Websites:-
www.eicherworld.com
www.wikipedia.com
www.scribed.com
www.mbaguyes.com
www.managementparadise.com
3. Books & Magazine:-
Marketing management (Philip Kotler )
Times of India
Business World
Economics Times
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