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INTRODUCTION
Maruti Suzuki India Limited is a leading four-wheeler automobile manufacturer in
South Asia. It is largely credited for having brought in an automobile revolution to
India.
It was a joint venture between the Indian government, and Suzuki of Japan. As of
May 10 2007, Govt. of India sold its complete share to Indian financial institutions.
With this, Govt. of India no longer has stake in Maruti Udyog.
The company annually exports more than 50,000 cars and has an extremely large
domestic market in India selling over 730,000 cars annually.
Maruti Suzuki offers 13 models, Maruti 800, Omni, Alto, Versa, Ritz, Gypsy, A Star,
Wagon R, Zen Estilo, Swift, Swift Dzire, SX4, and Grand Vitara. Maruti Suzuki has manufacturing plants in Gurgaon & Manesar
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Men
The company has a multi-tier managementstructure, comprising:1. Board of Directors
2. Managing Executive Officers
3. Executive Officers
4. Divisional Heads
Through this it is ensured that: Strategic supervision is provided by the board.
Control and Implementation of Companys strategies isachieved effectively.
Operational management remains focused on
implementation.
Information regarding the companys operations andfinancial performance are made available adequately.
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Delegation of decision making with accountability is
achieved.
Financial and operational control and integrity are
maintained at operational level.
Risk is suitably evaluated and dealt with.
The employees of Maruti, from techniciansto engineers to sales persons, have fully
imbibed the Japanese work culture of
making constant improvement, and placing
the prosperity of the company as the means
of their own advancement
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Money
For its Indian operations, the company plans
to invest Rs 9,000 Crore by 2010.
The company has also made huge investment
in the plant situated at Manesar, that is almost
ready to reach its peak production level of
300,000 units.
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The company also operates at the new enginefacility located at Gurgaon.
Maruti Suzuki has a good network of internalresources to finance the companys
operations, expansion plans as well as capital
investments.
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Machinery
The Manesar plant of the company
established in 2006achieved an expanded
installed capacity of 1,70,000 units at the end
of first year.
The models of Swift, SX4 and Dzire are
manufactured in Manesar.
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Recently, the company has introduced a peppy k
series engine for its new car, Maruti Suzuki A-star.
In future, it aims to produce more environment-friendly car engines.
The company plans to design cars that are fuelefficient and lower on CO2 emissions. It also hasplans to develop hybrid, electrical, and multi-fuel engines
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Materials
Maruti uses the following materials to reduceits energy consumption while manufacturing
cars:
Energy efficient fans in cooling towers
Special transformers to minimize the energy losses.
Energy efficient motors and blowers in the air washer
system for shop cooling
Energy efficient chillers for air conditioning.
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Building Management System and Variable Air Volume
System for optimized cooling in the work places and
reduce the energy consumption.
Increased re-use of waste heat of combustion for
running equipment.
Energy efficient lighting.
Energy efficient air driers.
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Methodology
Small is Beautiful
Maruti Suzuki has a firm belief that the future of Indiancar industry belongs to small cars.
The rising fuel prices, high input costs and congestedcity roads is paving way for small, light-weight and fuelefficient cars.
Even the government is supporting the introduction ofsmall cars with favorable policies.
Exuding companys confidence on growth of small cars,
Maruti Suzuki aims to roll out more numbers of smallcars for the Indian sub-continent.
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Re-enter Europe
Maruti Suzuki re-entered European marketwith a global car that is fuel-efficient and
lower on CO2 emissions.
This new car christened as Maruti Suzuki A-Star was launched in Europe with the brand
Suzuki Alto.
Maruti has announced to launch anotherworld strategic car model, Maruti Suzuki
Splash.
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Threat from the new players: Increasing
Most of the major global players are present in the Indian market; few
more are expected to enter.
Financial strength assumes importance as high are required for building
capacity and maintaining adequacy of working capital.
Rivalry within the industry: High
There is keen competition in select segments. (compact and mid size
segments).New multinational players may enter the market.
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Market strength of suppliers: Low
A large number of automotive components suppliers
Automotive players are rationalizing their vendor base to achieve
consistency in quality
Market strength of consumers: Increasing
Increased awareness among consumers has increased expectations.
Thus the ability to innovate is critical
Product differentiation via new features, improved performance andafter-sales support is critical
Increased competitive intensity has limited the pricing power of
manufacturers
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Threat from substitutes: Low to medium
Consumer preference is changing (Mini cars are being replaced by
compact or mid sized cars)
Setting up integrated manufacturing facilities may require higher
capital investments than establishing assembly facilitiesIndia is also likely to increasingly serve as the sourcing base for global
automotive companies, and automotive exports are likely to gain
increasing importance over the medium term
Indian passenger car market is moving towards cars of higher capacitycompetition is likely to intensify in the SUV segment in India following
the launch of new models at competitive prices
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The policies & objectives laid down by the Indian
Government regarding the automobile sector are:
Exalt the sector as a lever of industrial growth andemployment and to achieve a high degree of value addition in
the country
Promote a globally competitive automotive industry and
emerge as a global source for auto components
Establish an international hub for manufacturing small,
affordable passenger cars and a key center for manufacturing
Tractors and Two-wheelers in the world Ensure a balanced transition to open trade at a minimal risk
to the Indian economy and local industry
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Conduce incessant modernization of the industry
and facilitate indigenous design, research anddevelopment
Steer India's software industry into automotivetechnology. Example: the company developed
CMA software for carrying out target costing. Assist development of vehicles propelled by
alternate energy sources
Development of domestic safety and
environmental standards at par with internationalstandards
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Keeping the Government policies in mind Maruti Suzuki has
adopted the following policies to run the organisation:
Maruti Suzuki is one of the organisation which was able to
survive the global recession. Not only they made a reasonable
profit but also didnt give away any pink slips
Maruti Suzuki is the leading automobile manufacturer in the
country. Now they are in the process of re-entering the
European market by introducing A-Star
The company has now started using CNG Kits. They have
introduced this technology in Alto which fulfills the CSR of going
Green
The company has introduced KB-Series engine which offers
latest technology to the customers
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ECONOMIC ENVIRONMENT OF MARUTI SUZUKI
The global meltdown has certainly hit the Indian car industry
hard.The industry posted a growth rate of 11 per cent in the
year 2007 which has fallen to 3 per cent this year.
Maruti now plans to tap the rural market, 60 per cent of
which runs on cash .
Maruti has appointed 2,000 sales executives to target
customers in the rural areas.
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The company is offering discounts ranging from Rs 3,000 to8,000 on various models in the rural market.
On May 8 2009 Maruti Suzuki India planned to ramp up its
production capacity by addition of 2 Lakh cars in the next twofiscal years.
Currently, Maruti Suzuki manufactures 9 Lakh cars annually
to cater to the biggest segment - small cars in India.
It will be spending nearly Rs 1,800 Crore to develop the
capacity.
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Maruti Suzuki sold 7.92 Lakh cars in the last 2008-09 fiscal
year which combines the domestic sales and those madeabroad.
It recorded the highest sales in April with a 15 percent jump
and sale of 71,748 units in one month.
Company has allocated Rs 9,000 Crore for a new engine plant
and new research and development centre, in japan.
In January 2009, Maruti exported 4774 units and accounts for
a total car sales of 71,779 units.
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The recession affect on Automobile Prices
The pricing of the following cars have gone up by:
A-Star hatchback - Rs 10,000All variants of SX4 sedan - Rs 9,000.
The price of Swift Petrol LXi Rs 5,000.
For the higher variants of Swift-VXi and Zxi- Rs 6,000.
The new prices for Swift DZire Rs. 7,000
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SocialenvironmentWelfare Camps
Medical support & welfare
Education to underprivileged
Road SafetyMaruti Driving Schools
Greening of Supply Chain
Adopting energy saving
technologiesReducing water wastage
Green Growth
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Launched CNG kit for Alto, its highest selling
small car.
The company as a proactive move is all set tomake its entire fleet of cars adhere to end of
life vehicles (ELV) specifications by 2010 by
doing away with the usage of hazardous
substances during production of cars and
their components.
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The company is involved with the
development of small and fuel-efficient car
engines.
In future, the company has high plans to
increase the engine development work in
India along with other R&D operations.
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The company uses next generation KB series
Engine in its new Hatchback car A-star.
The company added Virtual Design Review toits R&D activity to enable virtual validation toreduce cycle time and development cost.
In the field of alternate fuel technology, the
company developed LPG system for MPIengine.
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3R- reduce, reuse, and recycle.
Continuous process of promoting 100%
recyclable and reusable car parts.
Targets reducing fresh water consumption andimplement rain water harvesting.
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The newly launched Maruti Suzuki A-Star is
designed to meet the European ELV (End-of-
Life Vehicle) norms.
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Encourages its customers to act uponenvironment friendly approach.
The company conducts regular training andeducation programmes at the supplier end.
Sessions are also held at all possible placescomprising people from all arenas of the carindustry.
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Researches are done to learn innovative ways
of improving ecological balance and reduce
automotive emissions.
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Education, and improvement initiatives aretaken on the shop floor.
The company has introduced three-coat-one-bake painting system at its facility.
The company is moving towards making itsentire fleet of cars green with advanced andefficient technologies.
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1999- Certified for establishing and
maintaining EMS as per ISO 14001:1996
standards. The company was again recertified
for the same in 2002.
Certified for changing its EMS from ISO
14001:1996 version to ISO 14001:2004version.
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Golden Peacock award for Environment
Management in 2007 was honored by World
Environment Foundation.
First prize for excellence in implementation of
Energy Conservation measures in industrial
sector was awarded by renewable energy
department of Haryana Government.
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Legal Environment
Follows highest standards of Corporate Governance
Customer can contact the Secretarial & Legal Department for anyquestions/clarifications.
Legal compliance reporting
The board periodically reviews reports of compliance with all lawsapplicable to the Company, as well as steps taken by the Company to rectifyinstances of non-compliances.
The Company has developed comprehensive legal compliance schedulingand management software by which specific compliance tasks are assignedto each individual. The software enables in planning and monitoring allcompliance activities across the Company.
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