Automobile Industry - Market analysis

1. MARKET ANALYSIS
OF
CONSUMER
DURABLES
(AUTOMOBILE
SECTOR)
Presented by
Group No.9
Sumeet Mittal (171)
K.Naresh kumar (172)
Ashish Sharma (173)
Gourav Kumar Bhut (174)
Anurag Nair (175)
Shashank Sharma (176)

2. CONSUMER DURABLES
Consumer goods are often divided into two categories: durables and nondurables.
A category of consumer products that do not have to be purchased
frequently(typically more than three years).Durables have an extended
product life and are not worn out or consumed quickly when you use them.
Examples of durable goods are
automobiles, appliances, furniture, jewellery, consumer electronics and
sporting goods.

3. INDIAN CONSUMER DURABLE MARKET
Multinational companies have garnered significant market share of about 30% and
25% respectively due to their superior product offerings at good prices.
According to Cygnus estimates, consumer durables market crossed the US$10.0
billion milestone by the year 2011-12, growing at a CAGR of 23.8.
It will be the key challenge for consumer durables manufacturing companies to
spend in R&D for surviving in the highly competitive market.
The household income in the top 20 boom cities in India is projected to grow at
10% annually over the next eight years.

4. AUTOMOBILE INDUSTRY
•
Automobile – wheeled passenger vehicle that carries its own motor.
•
The automobile industry is divided into two based on drive type
•
•
•
Two-wheel drive
Four-Wheel Drive
Part of the classification process takes into account the vehicle's body style:
•
•
•
•
•
•
•
•
Coupe
Convertible
Station wagon or estate car
Sedan
Minivan
Sport utility vehicle (SUV)
Sports car
Hatchback

5. INDIA’S AUTOMOBILES PRODUCTION
•
In 2010, India beat Thailand to become Asia's third largest exporter of
passenger cars.
•
The majority of India's car manufacturing industry is based around three
clusters in the south, west and north.
•
Chennai is the Detroit of Asia as it accounts for 6o% of Indian automobiles
production.

6. AUTOMOBILE COMPANIES IN INDIA
•
Indian Automobile companies :
Chinkara Motors, Force Motors, Hindustan
Motors, ICML, Mahindra, Premier Automobiles Limited, San
Motors, Maruti Suzuki, Tata Motors.
•
Vehicles assembled in India :
BMW India, Fiat India, Ford India, General Motors India, Chevrolet, Honda
Cars India Limited, Hyundai Motor India, Isuzu, Mercedes-Benz
India, Mitsubishi, Nissan Motor India, Renault India, Toyota
Kirloskar, Volkswagen Group sales India, Volkswagen India.

7. MARKET SHARE

8. 4 P’S OF MARKETING
Product
• Thing that is being sold. Not just the physical product itself, but also
anything related to how it is made, packaged and named. Also includes
product/service options, the after-sales service, warranties, and
servicing. BMW offers varied products/services.
Price
• Decisions about how much to charge for goods and services. Price
affect the viability of a brand and the profitability of an organisation.
Honda Amaze is priced in the mid-sized Sedan segment making it cost
effective.
Promotion
• Communication that relate to a specific marketing campaign. Includes
communication with retailers and distributors, communication with
purchasers and end users and also internal communication. XUV 500 is
promoted as a go anywhere SUV.
Place
• Refers to distribution. All aspects related to how goods and services are
'moved' from the producers to the end user. The target place of sell
determines the place. Audi and Mercedes showrooms in major
cities(Tier 1) and almost nothing elsewhere.

9. SUCCESSFUL MARKETING STRATEGY: PROMOTION
•
Maruti Suzuki promotes most of their products through TV ads and print media.
Whenever Maruti introduces any new product, it also attaches a new punch line
along with it in order to create a lasting relationship with the consumers.
•
Maruti came up with a new campaign based on the fuel efficiency aspect that
Maruti Suzuki looks to deliver with their cars. The ad has this line- "For a country
obsessed with mileage, Maruti Suzuki makes India's most fuel efficient cars."

10. SUCCESSFUL MARKETING STRATEGY:
PLACE/ DISTRIBUTION
•
Maruti has showrooms in all the major cities of the country. Maruti Suzuki
has largest network of dealers among car manufactures in India with more
than 4000 sales executives. Sales network is linked through secure extranet
based information network. The service network of Maruti covered 1500
cities across India with the largest no of service outlets.

11. SUCCESSFUL MARKETING STRATEGY:
PRODUCT AND PRICE
•
The company recently updated its manufacturing and technology
capabilities. It came up with better and efficient K-series engine. Maruti
also expanded its business portfolio by starting new but related businesses
such as -Maruti Driving School -Maruti True Value -Maruti Finance -Maruti
Insurance.
•
Maruti Suzuki offers 14 different models in a total of 92 variants. Maruti
Suzuki has made its presence in the market with prices ranging from Rs
2.27 lakhs to Rs 7 lakhs. The prices were kept low to attract middle income
group.

12. Targeting is identification of
attractive market segments
and fulfilling the needs of
consumers. For Mahindra &
Mahindra, the mid sized
Sedan can be one the target
markets
STP
Segmentation divides the
market into homogeneous
Sub-units. Price can be one
segment.
Economical, Premium, Super
Premium
Positioning is concept of
defining what role the brand
will play in enhancing
customers’ lives. More of
psychological aspect.
Mercedes positions itself as
a very classy and premium
automobile

13. SWOT ANALYSIS
strengths
weaknesses
•
•
•
•
•
Low cost and cheap labor
Increase in the export levels
Large pool of engineers
Increasing demand for European quality
Investments by foreign car manufacturers
•
•
•
•
Low labor productivity
High interest rate and overhead level
Low investment in R&D area
Local demand is still towards low cost vehicles due to
comparatively low income levels

14. SWOT ANALYSIS
Opportunities
•
•
•
•
•
•
Growing population in the country
Focus from the government in improving the road infrastructure
Rising living standards & Increase in income level
Rising rural demand for utility vehicles
Keeping a vehicle is becoming status symbol
Women drivers have increased
Threats
•
•
•
•
Less skilled labor
Lack of technologies for Indian companies
Increase in the import tariff and technology cost
Smaller players that do not fulfill international standards

15. PORTER’S ANALYSIS OF THE INDUSTRY
Suppliers Bargaining Power: Low
High competition among low suppliers
As suppliers are reliant on high volumes, they have less
bargaining power
Threat of New
Entrants :Very
Low
High capital requirements
High sunk costs limit
competition
Advanced technologies are
required
Industry requires economies
of scale
Rivalry amongst existing
competitors: High
Intense due to the entry of foreign companies
Rivalry high with any product being matched in a few months by
competitors
Similar technical capabilities
Collaboration with international players
Threat of Substitutes: Mild
A limited no of substitutes are there implies that
customers cannot easily find other products or
services
Buyer’s
Bargaining
Power: High
•The power axis is
tipped in the consumers’
favor.
Low switching costs from
among competing
brands

16. OBJECTIVE OF THE STUDY
To carry out a study of consumer durables (automobile sector) in India.
Analysis of Indian automobile market based on marketing theories.
To find out the factors affecting the decision making while buying a vehicle.
A small comparison study of different companies & their brand image.

17. METHODOLOGY
Based on the
analysis, conclusion
Public survey of
consumers
Internet
Customer
needs
Magazines
Factors
affecting
EMedia
Likeness
among
the
masses
Primary Data
Secondary Data
marketing strategies
Data analysis: Survey of Consumers

18. TOOLS USED FOR DATA ANALYSIS
Tables.
Bar graphs.
Pie charts.
SPSS.
Microsoft Excel.

19. DEMOGRAPHIC ANALYSIS
6% 5%
Gender
38%
18 - 23
23 - 28
28 - 34
34 - 40
40 - 50
> 50
Male
Female
62%
Age
10%
40%
9%
30%
Annual Income 7%
Occupation
<3 Lakhs
3-5 Lakhs
18%
16%
Services
5%
11%
37%
Student
5-8 Lakhs
>12 Lakhs
8-12 Lakhs
House Wife
27%
32%
Business
47%

20. FACTORS AFFECTING PURCHASE
2%
Type of car preferred
34%
41%
Sedan
Hatchback
23%
SUV
Other
Type of Engine preferred
20%
54%
26%
Petrol
Diesel
CNG

21. PRICE
LOOKS
MILEAGE
INTERIORS

22. SAFETY FEATURES
ENGINE PERFORMANCE
SEATING CAPACITY
ACCESSORIES

23. AFTER-SALE SERVICES
LONGEIVITY
STATUS SYMBOL

24. BRAND RECALL
Factors Helping in Brand Recall
Brand Recalled
6.56%
4.92%
Maruti Suzuki
8.20%
26.23%
24.59%
26.23%
Hyundai
Honda
Ford
Tata
3.28%
M&M
Others

25. ACCESSORIES LOOKED FOR
WHOM DO CONSUMERS
CONSULT

26. COMPETITOR ANALISYS
Company preferred for Price
Company preferred for Mileage
Maruti Suzuki
Maruti Suzuki
TATA
Hyundai
Hyundai
TATA
Others
Others
0
0
10
20
30
10
20
30

27. Company preferred for Looks
Company preferred for Interiors
Mercedes Benz
Honda
BMW
Volkswagen
Audi
Audi
Others
Others
0
0
10
20
30
5
10
15
20
25

28. Company preferred for Safety
Features
Company preferrd as Status Symbol
Mercedes Benz
Toyota
BMW
BMW
Audi
Mercedes Benz
Others
Others
0
5
10
15
20
0
5
10
15
20
25

29. Company preferred for Seating
Capacity
Company preferred for Engine
Performance
Maruti Suzuki
Toyota
Toyota
Hyundai
Mahindra & Mahindra
Maruti Suzuki
Others
Others
0
10
20
30
0
5
10
15
20
25

30. Company preferred for Accessories
Company preferred for After-Sale
Services
Audi
General Motors
Skoda
Hyundai
Mercedes Benz
Maruti Suzuki
Others
Others
0
0
10
20
30
40
5
10
15
20
25

31. Company preferred from Longevity
Toyota
Mahindra & Mahindra
Company preferred from Longevity
Maruti Suzuki
Others
0
5
10
15
20
25

32. CONSUMER WITH OCCUPATION BUSINESS AND
SERVICES:
ENGINE PREFERENCE
11%
50%
39%
diesel
petrol
cng

33. PREFERENCE WITH REFERENCE TO
ANNUAL INCOME
Preference reference to family annual incom
4.5
Annual income between 3-5
lakhs
4
3.5
3
2.5
2
1.5
1
0.5
0
hatchback
sedan
Suv
Preference reference to family annual
incom
10
8
6
4
2
0
hathchback
sedan
suv
Annual income between 5-8
lakhs

34. Preference with reference to income
8
7
Annual income between 812 lakhs
6
5
4
3
2
1
0
hatchback
sedan
suv
sports
Preference reference to annual income
8
7
6
5
Annual income below 3 lakhs
4
3
2
1
0
hatchback
sedan
suv

35. T-TEST FOR FACTORS AFFECTING PURCHASE DECISION
WITH RESPECT TO GENDER
Factors Affecting Purchase Decision
Significance Value
Price
0.159
Mileage
0.029
Looks
0.303
Interiors
0.464
Safety Features
0.321
Seating Capacity
0.319
Engine Performance
0.169
Accessories
0.078
After-Sale Services
0.168

36. •
Null Hypothesis(H0): The factors affecting the purchase decision are same for both males and
females.
•
Alternate Hypothesis(H1): The factors affecting the purchase decision are different for both
males and females.
•
From the Independent sample T test we see that the significance value for all factors is greater
than 0.05 except for mileage. Hence, null Hypothesis is rejected in this case and we can
conclude that there is a significant difference between perception of males and females with
respect to mileage.
•
From the mean values, we see that males give more value to mileage than females.

37. ANOVA TEST OF FACTORS AFFECTING PURCHASE
DECISION WITH RESPECT TO AGE
Factors Affecting Purchase Decision In Respect To Age
Significance Value
Price
0.697
Mileage
0.498
Looks
0.621
Interiors
0.085
Safety Features
0.001
Seating Capacity
0.382
Engine Performance
0.059
Accessories
0.269
After-Sale Services
0.697

38. •
Null Hypothesis(H0): The factors affecting the purchase decision are same for
people of all age groups.
•
Alternate Hypothesis(H1): The factors affecting the purchase decision are
different for people of different age groups.
•
The significance value of all factors apart from Safety Features is greater than
0.05.
•
Hence for all the age groups there is not much of a difference in important
given for the various factors affecting the purchase decision apart from safety
features.
•
Safety Feature is a very important parameter for consumers above the age of
40 years.

39. ANOVA TEST OF FACTORS AFFECTING PURCHASE
DECISION WITH RESPECT TO INCOME
Factors Affecting Purchase Decision In Respect To Income
Significance Value
Price
0.597
Mileage
0.000
Looks
0.629
Interiors
0.000
Safety Features
0.481
Seating Capacity
0.056
Engine Performance
0.389
Accessories
0.728
After-Sale Services
0.240

40. •
Null Hypothesis(H0): The factors affecting the purchase decision are same for people of all
income groups.
•
Alternate Hypothesis(H1): The factors affecting the purchase decision are different for
people of different income groups.
•
The significance value of all factors apart from Mileage and interiors is greater than 0.05.
•
Hence for all the income groups there is not much of a difference in important given for
the various factors affecting the purchase decision apart from mileage and interiors.
•
Mileage is a very important parameter for consumers earning less than 5 lakhs.
•
Interiors is an important parameter for consumers earning above 12 lakhs.

41. CONCLUSION
•
Mileage & Longevity are the most important factors which consumers consider before buying a car.
•
Consumers prefer to buy sedans & diesel engines.
•
Brand Logo & advertisements are the most important parameters that help consumers in recalling a
brand.
•
Brand ambassador does not affect the consumers to a great extent.
•
Power Windows & Stereo Systems are the most preferred accessories for consumers.
•
Use of social media forums for consultations is rising.
•
Males give more value to mileage than females.
•
Safety Features is the most important parameter for consumers above 40 years of age.
•
Mileage is the most important factor for consumers with an annual income of less than 5 lakhs.
•
Interiors is the most important factor for consumers with an annual income of more than 12 lakhs.