Maruti Suzuki is the leading automobile company in India with a 47% market share. Some key points: 1. Maruti Suzuki saw an 8.4% increase in passenger car sales in December 2017 compared to the previous year. 2. The company invests heavily in research and development, spending Rs. 4800 crores to develop more fuel efficient and environmentally friendly vehicles. 3. Maruti Suzuki faces competition from other major automakers in India like Hyundai, Tata, and Mahindra but maintains an advantage through its large dealership network and focus on affordable prices. 4. Going forward, the company aims to sell 2 million units annually by 2020 and

1. AUTOMOBILE INSUSTRY Maruti Suzuki
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I. General features / Basic Conditions
 Demand Details
 Demand
CATEGORY SUB-
SEGMENTS
DECEMBER 2017 DECEMBER 2016 % CHANGE
PASSENGER CARS 87,864 81,092 8.4%
DOMESTIC
PASSENGER
VEHICLE
118,560 106,388 11.4%
Light Commercial
Vehicles
726 26 NA
TOTAL 119,286 106,414 12.1%
 Growth Rate
4.8 per cent
 Nature of Demand –
Direct / Regular
 India is an attractive market because…..
Since per capita income has increased it will result into increase in demand
 Demand Trends
There are three main types of trends: short-, intermediate- and long-term
 Elasticity of Demand
 an upturn or downturn in this sector is due to an aggregate effect of multiple factors.
 These together govern the economies of automobile sector.
 Substitutes
 Mahindra
 Hyundai
 Chevrolet
 Tata
 Ford
 Honda
 Consumers and Consumer Behavior
According to a research in comparison with Maruti Suzuki
 63.24% of the respondents feel that the car which they own is expensive and 36.76%
feel that the price of the car which they own is reasonable
 Product Missions
 To sell two million (20 lakh) units per annum by 2020
 Maruti Suzuki identifies environmental impact and develops strategies to mitigate
impacts in each of these areas

2. AUTOMOBILE INSUSTRY Maruti Suzuki
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 Technology details
i. Innovation
 Some innovations are as following…
a. Fuel efficiency
b. Hybrid cars
ii. Greater emphasis on research and development
Spends 4800 cr. For R&D
iii. Increased regulation of technological change
Anti Pollution Pressure and implementation of euro norms and Bharat norms
 Basic Technologies
 Recently, the company has introduced a peppy k series engine for its new car, Maruti
Suzuki A- star.
 It is planning to develop hybrid, electrical, and multi fuel engines.
 Manufacturing Global Cars that is fuel – efficient and lower on CO2 emissions.
 History of Innovations
 started to follow the Total Quality Management system
 factories of the company follow a ‘zero exit’ programme, which means there is no
wastage.
 It is not only environment-friendly, but also ensures that waste from our factories go
to different industries
 Threats and Opportunities from the technological perspective
Opportunity: Technological advancement
Threat: Electric car
 The Role and importance of Technology
To nurture the industry ecosystem. It helps industry gain efficiencies and get clarity on
which targets and technologies to work on.
 Investment details
 Typical asset patterns
COMPANY
 FORCE MOTORS
 ENDURANCE TECH.
 STEEL STR. WHEEL
 WABCO INDIA
 MINDA INDS.
 SUBROS
 RICO AUTO INDS
 HMT
 FIEMINDS.
 PTL ENTERPRISES
 SHIVAMAUTOTECH

3. AUTOMOBILE INSUSTRY Maruti Suzuki
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 General points
 Public Policies relating to industry
 Security
 Information Sharing and Disclosure
 Environmental impact – social / Political / legal
A. Political- legal factors
 Government promoting foreign investment (FDI’s)
 Stable political environment
B. Social
 Rise of middle class leading to improved purchasing power
 Mass transportation due to increase environment consciousness
C. Legal
 Need to comply with ever evolving emissions standards
 Need to comply various safety and technical standards
 Critical success factors
Our environment Policy:
 •Prevent pollution.
 •Promote energy reduction and use of alternative energy.
 •Manage/ reduce those materials that put stress on environment.
 •Promote the three R's (Reduce, Reuse, Recycle).
 •Promote "Green" procurement.
 •Provide our employees with environmental education to increase their awareness
II. Industry Environment
 Maturing
III. Industry Structure
 Number of Players
6 strong players
 Total Market and Relative Market share
47% of the Indian population
 Installed capacity
 Nature of Competition
 Shifted from Oligopoly to Monopoly
 The Indian auto industry has the sixth-largest automobile producer in the world and
grown with an increase of 14.4% from the past decade.

4. AUTOMOBILE INSUSTRY Maruti Suzuki
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 Entry and exit barriers
 Entry barriers are in the form of economies of scale of operations, investment
requirement, degree of product differentiation, cost disadvantage etc.
 automobile industry has many entry and exit barriers which reduces the attractiveness
Understanding Entry Barriers
India's incredible growth forecasts, infrastructure progress (especially new and better roads),
and ever-expanding financing options to rural residents, the market is attractive. As such, we
expect the threat of new entrants to be high in automobile industry of India.
 Product Differentiation
Manufacturing, increasing capacity, launching new products at regular intervals so as to cater
to all the segments of the Indian passenger car market and venturing into other related
businesses like car finance, insurance and buying and selling used Maruti cars
 Capital requirements
 management is using long term funds to short term requirements.
 The fall in working capital is a clear indication that the company is utilizing its short term
resources with efficiency
 Government Policy
 If there is a change in the government policies regarding the increase in the road tax
charged or the tax which is to be paid per unit sold, the supply of a car will fluctuate
with the nature of the change.
 Recently the government has reduced the custom duty on inputs and raw materialfrom
20% to 15% which has increased the supply
 Cost Structure
 raw materials
 employee cost
Prime cost
 power and fuel
 manufacturing
factory cost
 selling and administration
 miscellaneous expense
Total expense

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 Global reach
Contributes 52% to global production
 Investors
Tied with
1. HDFC Bank
2. ICICI Bank
3. Axis Bank
4. State Bank of India
5. Sundaram Finance Ltd.
6. Cholamandalam Investment and Finance Company Ltd.
 Investment Barriers / Gestation Barriers
 No barriers
 Maruti Suzuki India (MSI) is investing another Rs 1,900 crore till March 2019
 Good access of funds due to availability of cheap loans
 Persistent high growth rates for past few years
IV. Industry attractiveness
 Potential
Maruti Suzuki says India has potential to become world’s biggest car maker
 Growth
50% sales growth in feb 2018
 History and evolution
 In February 1981 Maruti Udyog Limited (MUL) was incorporated under the
provisions of the Indian Companies Act, 1956.
 A license and Joint Venture Agreement was signed between Government of India and
Suzuki Motor Company in October 1982..
 On 14th December, 1983, first Maruti 800which was produced in gurgaon plant..
 By 1992 SMC had acquired a majority stake in MUL (increases to 54.2%).
 In 1990's when the economy was liberalized and foreign investment allowed into
India, the auto component companies, set up and nurtured by Maruti Suzuki, became
the foundation for global car companies as well.
 By 2003 it got listed on the BSE and NSE.
 In 2007 the Board of Directors of the company gave approval to change the name
MUL to Maruti Suzuki India Limited.
 In 2008 M800 crossed the 25 lakh mark and MSIL celebrated its Silver Jubilee.
 By 2009 MSIL‟s Capacity to manufacture expanded from 800,000 to a million units
(Gurgaon plus Manesar plants) annually.
 Currently it has 47% market share of Automobile
 Norms
 normative and a descriptive discipline

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 Determinants of Demand
 Financing Option
 Advertising And Marketing
 Price Of The Car
 Income Of Consumer
 Increase In Affordability
 Demographic Drivers
 Availability Of Easy Financing Options
 New Offerings
 Future Patterns
Maruti Suzuki India will be showcasing its latest Concept Future S with an all new compact
car design language at the Auto Expo 2018.
V. Industry Performance
 Production
 Sales
 Technological advancement
 IT network links vendors across the country & keeps track of order and delivery status.
 Electronic Data Processing (EDP) Dep't. manages postsales process & sales analysis.
 Styling & Engineering functions done in UGS’ NX solutions
 Data Management Software maintains record of all enquiries & provides timely reports
on demand.
VI. Industry Practices
 Pricing Policy
 Penetrative and competitive.
 Pricing policy is a very subjective and sensitive issue, special care is taken
to insure that the pricing policy remains reasonable and affordable.
 Product policy
 products are made keeping the common man in mind
 Products are known for their durability, service, pick up, car design and
most things which you expect from a basic car.
 Promotion Policy
 use all types of media

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 R&D
Invests 3800 cr. For R & D
 Advertising and Sales promotion
 visual media and the print media
 such as televisions, radio, newspapers, magazines, road shows, seminars and
workshops
 What makes the product competitive
 Likability
 Affordability
 Assurance
VII. Emerging trends
 Nature of five forces
 Threat from the new players: Increasing
 Rivalry with in the industry: High
 Market strength of suppliers: Low
 Market strength of consumers: Increasing
 Threat from substitutes: Low to Medium
 Analysis of existing competition
 Competition is the biggest affecting factor in any industry.
 Maruti has competition mainly from Hyundai ford, Tata and Toyota.
 Here in automobile whenever Maruti comes up with any new car model or certain
features, it will be soon copied by the competitors.
 As Maruti’s focus is mainly related with price and competitors are always providing
price competition to Maruti.
 Competitive advantage
 Capital intensive
 Huge investment required to achieve economy of scale
 Strategies and Programs
capabilities
core
competencies
competitive
advantages

8. AUTOMOBILE INSUSTRY Maruti Suzuki
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 Market share
47%
 4 Ps
1. Product
Maruti Suzuki has divided its Product line into five segments as per the following table
 Under product line A1, A2, A3, Maruti Suzuk’s main focus is on producing quality
car with high mileage.
 Some cars have been rolled out for use with both Petrol and Diesel.
 Design: Maruti Suzuki according to different segment of the focuses on the designing
of the car too.
A. Services
B. extended warranty
2. PRICE:
 Maruti achieves its low car pricing strategy through continuous improvements in
operational efficiency and productivity.
3. Place
The extensive network for MSIL is:-
 Showrooms & Car Sale Outlets – 933 covering 668 cities
 Authorized service stations – 3053 nationwide service outlets covering 1395 cities
 True-Value Outlets – 668 covering 393 cities MSIL makes available all the genuine
parts of the car throughout the country so that the car
4. PROMOTION:
 TV – There have been a lot of advertisements through this media as most of the target
audience connects to MSIL through its emotional TV commercials where the company
touches everyone irrespective of their Demographics, Age, Occupations, etc.
 Print Media – The Company has also used Newspaper, Magazines to promote its
products to the consumers.
 Radio – The Company also uses radio as an important media for advertising its product
line. It sponsors certain shows on air, events for all radio users, etc.

9. AUTOMOBILE INSUSTRY Maruti Suzuki
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 SWOT analysis of Maruti Suzuki
Strengths
 market share of 48.74
 largest network of dealers and after sales service centers in the country.
 recently attained the 10million domestic sales mark.
 Strong Brand Value and Loyal Customer Base are big strengths
 There are around 15 vehicles in Maruti Product portfolio. Has good product lines with
good fuel
Weaknesses
 Low interior quality inside the cars when compared to quality players like Hyundai and
other new foreign players
 Government intervention due to having share in MUL.
 Younger generations started getting a great affinity towards new foreign brands
Opportunities
 MUL has launched its LPG version of Wagon R and it was a good move
simultaneously
 MUL can start R&D on electric cars for a much better substitute of the fuel.
 Export capacity of the company is giving new hopes in American and UK markets
Threats
 MUL recently faced a decline in market share from its 50.09% to 48.09 % in the
previous year(2011)
 Major players like Maruti Suzuki, Hyundai, Tata has lost its market share due to many
small players like Volkswagen- polo.
 Tata Motors recent launches like Nano 2012, Indigo e-cs are imposing major threats to
its respective competitor’s segment
 China may give a good competition as they are also planning to enter into Indian car
segment