Mktg Strats Tyre Industry

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Mktg Strats Tyre Industry

  1. 1. THE TYRE MANUFACTURING INDUSTRY
  2. 2. PRESENTED BY: <ul><li>NAME ROLL NO. </li></ul><ul><li>Dattu Ade 1 </li></ul><ul><li>Reena Alva 4 </li></ul><ul><li>Vicky Barot 6 </li></ul><ul><li>Abhijit Bhongle 8 </li></ul><ul><li>Bhushan Bhoye 9 </li></ul>
  3. 3. INTRODUCTION <ul><li>Faces huge competition, cost and price pressure. </li></ul><ul><li>The zooming auto industry has driven the growth. </li></ul><ul><li>The number of vehicles is swelling. </li></ul><ul><li>The truck and bus market is the largest segment in terms of value. </li></ul>
  4. 4. <ul><li>Economic expansion and road development has made a contribution. </li></ul><ul><li>eg. The golden quadrilateral and the NSEW Corridor project. </li></ul><ul><li>Though the volumes have increased the profitability has gone down due to the increase in raw material cost. </li></ul>
  5. 5. Five forces model
  6. 6. A 2 tier Industry <ul><li>Tier 1 players </li></ul><ul><li>Present in all three segment - </li></ul><ul><li>1)Replacement market </li></ul><ul><li>2)Original equipment manufacture(OEMs) </li></ul><ul><li>3)Export </li></ul><ul><li>Tier 2 player </li></ul>
  7. 7. Key Players
  8. 8. Major Sales Segment
  9. 9. Intensity of Rivalry : High <ul><li>The tyre industry in India is fairly concentrated, with the top 5 companies accounting for more than 80% of the total production of tyres. </li></ul>
  10. 10. BARGAINING POWER OF SUPPLIERS - High
  11. 12. <ul><li>Number of Suppliers – Low </li></ul><ul><li>Availability/ acceptability of raw material substitutes – Low </li></ul><ul><li>Switching costs – High </li></ul><ul><li>Threat of forward integration – High </li></ul><ul><li>Tyre industry not the key customer </li></ul>
  12. 13. Demand for Tyres
  13. 14. Bargaining Power of Buyers <ul><li>OEM’s High </li></ul><ul><li>In Replacement Market Moderate </li></ul><ul><li>Switching Cost Low </li></ul><ul><li>Threats of Backward Integration Low </li></ul>
  14. 15. THREAT OF POTENTIAL ENTRANTS <ul><li>LOW, due to HIGH ENTRY BARRIERS </li></ul>
  15. 16. ENTRY BARRIERS <ul><li>Highly capital intensive industry </li></ul><ul><li>Rs4bn for radial tyre plant with a capacity of 1.5mn tyres </li></ul><ul><li>Rs1.5-2bn for a crossply tyre plant of a capacity to manufacture 1.5mn tyres </li></ul><ul><li>High raw material costs </li></ul>
  16. 17. <ul><li>Shortage of raw material </li></ul><ul><li>Force of rivalry </li></ul><ul><li>High risk </li></ul>
  17. 18. THREAT OF SUBSTITUTES <ul><li>Low, but increasing </li></ul><ul><li>Import of tyres </li></ul><ul><li>ISI mark made compulsory </li></ul>
  18. 19. Porter’s Model <ul><li>Entry High returns </li></ul><ul><li>Barrier High risks </li></ul><ul><li>High </li></ul><ul><li>Low </li></ul><ul><li>High Low Exit Barrier </li></ul>

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