Cielo the car in trouble
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Cielo the car in trouble

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Cielo the car in trouble Cielo the car in trouble Presentation Transcript

  • Cielo: A Car In Trouble Group 8: Ashish Daga Pramod Hebballi H.P. Panda Sangeeta Dass Megha Kamparia Wasim Mukkaram 대 우 인 터 내 셔 널
  • “ STRATEGY WITHOUT TACTICS IS THE SLOWEST ROUTE TO VICTORY. TACTICS WITHOUT STRATEGY IS THE NOISE BEFORE DEFEAT.”
  • ENTRY OF DAEWOO
    • Heralded as a milestone for the industry
    • Challenged Maruti Udyog Ltd
    • 1 st vehicle launched in 3 versions
    • Bookings reached an astonishing no 114000
    • Had plans to become a 100 billion company
  • Now comes the bad part
    • 70000 customers cancelled there booking
    • Predicted an annual turnover of 10 billion and 20000 cars but managed 6.05 billion and 9044 cars
    • Again in April-Dec 52000 target but 13776 sold
    • Feb 1998, 9006 cars were sold again a decline of 41%
    • Next year reduced by 50 %
    • Recorded a loss of 351.4 million in 6 months as sales also declined to 1.22 billion from 2.7
    • It is not necessary that tried and trusted formula in one country will work in every country
  • Reasons for their downfall
    • Stiff competition from General Motors and Ford
    • Targets set by Daewoo was too high and ambitious
    • Daewoo itself was responsible for the mess
    • Daewoo is good at making cars but rotten at marketing them
  • Background of daewoo motors
    • Founded in 1967 in Korea it was a part of Daewoo group
    • In 2001 had its operations in 123 countries
    • Basically a company whish exported readymade garments to US
    • Later diversified into trading, construction, automotive, etc
    • Automotive became one the most important ventures
    • In 1977 entered into joint venture with General motors but conflicts arouse
    • In 1991 Daewoo bought out 50% stake in the venture for 50 billion
    • Faced tough competition in European and us market it looked to diversify it into eastern Europe, Latin America and Asia
    • Took over 50% equity held by Japans' Toyota in DCM-TOYOTA
    • Renamed it as Daewoo motors India ltd
    • Dcm-Ltd again sold 24% of its stake which increased its stake to 75% in Jan 1997 and 92% in 1998
    • Overseas investment on borrowed funds
    • In 2000, co’s labor union refused to accept a restructuring plan for the company
    • Daewoo was declared bankrupt
    • Daewoo is good at making cars, but rotten at marketing them.
    • -An Automobile Industry Analyst, 2000
  • Cielo
  • Strengths
    • Size and Market share.
    • Quality Products.
    • Technology Potential.
    • Early movers advantage in India.
  • MISTAKES
    • Lack of a focused approach and inconsistent policies
    • Launching of the car into the Indian market was done in an extremely hurried manner
    • High import content
    • Lack of proper market survey
    • Poor fuel efficiency due to lack of modification in Engine
    • Did not react to customer complaints
    • Tried to tackle this problem through its sales staff but they were also not properly trained
    • Daewoo assumed there was demand for cars in mid size segment
    • People tried to postpone their need to recession in an economy.
    • Focus On Numbers Not On After Sales Services
  • Promotional activities
    • In 1995 Daewoo came up with Diwali bonanza scheme
    • Reduced the finance rates to 14.33%
    • Discount of 10% was given
    • Test drive scheme in April 1997
  • Positioning Error
    • Company Keep on changing the positioning of cielo
    • Different positioning
          • “ Technology & Aesthetics”
          • “ Premium Family Car”
          • “ Value Benefits”
  • CRITICISM FOR PROMOTING
    • In the free scheme people felt there was something wrong
    • Lost its image as a feature-rich, luxury family car
    • Questioned by MRTP authorities
    • Termed ‘unmemorable and poor’ due to constant changes in the positioning
  • THE BIGGEST BLUNDER
    • Hefty Price Cut Of Rs 1.5 Lakh
    • Launch of the ‘ Valyou ’ campaign
  •  
  • Implications
    • Shock to competitors.
    • Loss to credibility of the car.
    • Loss of customer’s trust.
    • Launch of ‘Val-You’ Campaign.
  • Where Was Cielo ?????
    • Dumped Without A Funeral Ceremony
  • Matiz
  • SHIFTING THE FOCUS
    • Oct 1998- MATIZ was launched .
    • 23,265 units in april-dec 1999, demand increased by 52.2 to 35,398 units april-dec 2000
    • Further CIELO took a back seat after matiz success globally
    • Replaced CIELO GLE and GLX with EXECUTIVE and NEXIA but customers failed to see any difference
    • Advertising of CIELO stopped
    • MATIZ was going places operating in 114 countries
    • Failure in INDIA due to SANTRO
  •  
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  • SUGGESTIONS
    • Massive cost cutting exercise
    • Reduce the working hours
    • Reduce the no of workers
    • Increase the use of automation
    • Postpone the launch of three new cars due to the losses
    • Change the positioning of Cielo once more
  • Conclusion
    • We believe the chances of its success after
    • re-positioning is bleak
  • Thank You
    • We Are Ready For Questions???