Hindustan Motors was once India's largest car manufacturer, producing the iconic Ambassador from 1957. However, [1] as the automobile industry liberalized in the 1990s-2000s and foreign competitors entered India, Hindustan Motors struggled to adapt, failing to upgrade technology, production, or vehicle design. [2] In contrast, Maruti Suzuki offered modern, fuel efficient vehicles across multiple segments and used effective marketing. [3] Hindustan Motors' reliance on its outdated Ambassador model and narrow customer focus contributed to its declining market share and eventual failure to compete.

1. A PRESENTATION ON
IMPORTANCE OF INNOVATION IN
BUSINESS
By- Group No. 11
Business Innovation & Growth

2. HINDUSTAN MOTORS
Introduction
First India car manufacturer in India – 1942
Started production
- Landmaster 1954
- Ambassador 1957
Hindustan Motors- Ambassador running in
Indian road more than 5 decades.
 Leader in car sale up to 1980
It is a Rs. one billion turnover company
manufacturing Passenger Cars, Utility
Vehicles, Power Products and Earthmoving
Equipment.

3. Evolution of automobile industry in India
Initial Years Early to mid 90s Mid 90s – Early 2000s
Manufacturing was licensed
License Raj •Seller’s market and long •Buyers market
waiting periods
•High Customs duty on •Easy Auto finance
import •Decrease in customs &
excise •Manufactures
•Steep excise duties & diversifying into related
•Auto finance boom- more activities: finance lease,
•sales tax players fleet management,
insurance and used car
1980s •foreign banks & non market
banking companies, better
•Entry of MUL, better schemes. •But HM diversified very
product, lately compared to all
with government support other companies
•Seller’s Market
•Long Waiting Periods

4. Environment Turnaround
Indian economy opened for foreign players, many
multinational automobile companies entered the country
such as Toyota, Fiat, Ford. GM, Daimler Benz, Hyundai,
Honda Motors
Maurti Suzuki was able to bring brands for each
segment across nation. Substitute for the brand was quite
visible in the economy
HM didn’t know where they fit in the existing economy

5. Reason for failure
HM market leader Before Maruti was able to sell
whatever it produced therefore it did not care to upgrade
the technology or production facilities.
HM’s design was not aesthetic failed in aerodynamic
designs
HM popular product Ambassador customized for
Indian poor road conditions was on design concept with
outdated features, and fuel inefficient
Effective marketing strategies of the competitors like
Maurti eat the share of HM
HM was focused only on one segment - politician, top
civilian, bank manager, defense personnel