Arif Report

PART-I

Introduction

1.1.OVERVIEW OF AUTOMOBILE SECTOR IN INDIA

The Automobile sector is one of the fastest growing manufacturing sectors in India.

In the 90s the industry witnessed an average growth rate of above 20 percent.

Indian Automobile Industry is characterized by a very high percentage (75 per cent) of two wheeler production, ranking second only to Taiwan.

The world leaders in the sector are evincing keen interest in establishing manufacturing facilities for manufacturing and assembling components.

A politically stable and vibrant State, Andhra Pradesh is centrally located with the support of seaports, international airports, assured and reliable power supply, abundant water, broad base of auto component manufacturers, highly trained, skilled and disciplined manpower and is therefore, the preferred location for Automobile industries.

The interest of the state has been duly noted by Global Auto Majors, who have indicated their interest to consider Andhra Pradesh for establishing manufacturing facility.

The Government of Andhra Pradesh invites leaders in the industry to set up manufacturing facilities to manufacture vehicles or vehicle components in the State. The ideal places to locate companies in the Auto Sector are the Hyderabad-Zaheerabad, Visakhapatnam-Kakinada, Krishnapatnam-Tada-Sathiveedu and Vijayawada-Guntur corridors.

The Government is also formulating an Auto Policy, which would give a proper direction to the growth of the sector.

There are more than 20 auto component manufacturing companies in the State, manufacturing components such as grey-iron castings, precision aluminium castings, leaf springs,oils and lubricants, diesel fuel injection equipment, electronics and auto electronics and auto electrical, front axles, gears, forging, machined components, pressed metal components, pistons, cylinder liners, nozzles, delivery valves, starter motors, alternators, electronic regulators, high pressure die castings, clutch covers, fuel filters ,etc.

Most of these components are presently being supplied to Hero Honda, TVS Suzuki, Escorts Yamaha, Bajaj and others. Amaron Batteries are manufactured in Chittoor district. Around 119 components manufacturers have been certified for ISO 9000 quality standards and seven companies achieved the QS 9000 quality standard set by government and motors association. 1.2 ABOUT THE COMPANY

Hero Honda has a reputation of being the most fuel-efficient and the largest selling Indian motorcycle. Its commitment of providing the customer with excellence is self-evident. A rich background of producing high value products at a reasonable price led the world's largest manufacturer of motorcycles to collaborate with the world's largest bicycle manufacturer.

It was this affinity in working cultures of Honda Motor Company of Japan and the Hero Group that resulted in the setting up of Hero Honda Motors Ltd. A relationship so harmonious that Hero Honda has managed to achieve indigenization of over 95 percent, a Honda record worldwide.

Tactical promotions and excellent marketing helped Hero Honda establish itself as an intelligent purchase. Its unique features like fuel conservation, safety riding courses and mobile workshops helped the group reach in the interiors of the country.

Finance services helped facilitate purchase, as did an efficient dealer network across the country.

Well-entrenched in the domestic market, Hero Honda Motors Ltd. turned its attention overseas, and exports have been steadily on the rise.Over the years, the Company has received its share of accolades, including the National Productivity Council's Award (1990-91), and the Economic Times - Harvard Business School association of India Award, against 200 contenders.

Its main Models are Hero Honda cbz CBZ Xtreme splendor Splendor plus

Super splendor

CD 100 CD 100ss CD dawn

CD deluxe

Street smart Passion Passion plus

Karizma Ambition 135 Hunk

1.5.STRUCTUREHero Honda Motors Ltd (HHML), the worlds largest two-wheeler manufacturer for eight consecutive years, continues to drive industry volumes with a robust 24 per cent growth in the month of February 2009 over the corresponding month in 2008. Hero Honda today reported sales of 329,055 units in the month of February 2009, as compared to 265,431 two-wheelers in February 2008.

Despite an overall slowdown, Hero Honda continues with its accelerated growth story. In the period April08-January09, while overall industry grew by 1.7 per cent, Hero Honda has grown by 10.7 per cent. Now with its robust performance in February, Hero Hondas YTD growth has further gone up to more than 11 per cent.

Mr. Anil Dua, Sr. Vice-President (Marketing & Sales), Hero Honda Motors Ltd said, Our new launches, including Passion Pro Power Start in particular, have been driving strong volumes across geographies, further consolidating our more than 56 per cent share in the domestic motorcycle market. We have just introduced a Special Edition Hunk to commemorate our 25th Year, which is also expected to catch the fancy of our customers.

The consistently-positive performance in the midst of the current challenging environment reflects the value of reaching out to customers with dependable products and compelling propositions. This has been supported by a series of initiatives around the extensive product range, focused communication, on-ground activation, network expansion, financial discipline and operational excellence.

Hero Honda recently received four prestigious awards at the NDTV Profit Car India Bike India Awards 2009 which include The Viewers Choice Award for Passion Pro, Two Wheeler Manufacturer of the Year Award, Best Integrated Campaign Award for Hero Honda Pleasure, and The Best Brand Ambassador of the Year Award which went to Priyanka Chopra for Pleasure.

[Source: Hero Honda Motors Ltd]

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Honda & Hero Honda Motors To Continue Further Their 25 Year Old Partnership INDUSTRY SCENARIO

In the present scenario of automobile industry the major companies are: -

Manufacturers Products

% of market share

HERO HONDAMotorbikes 75% market share

BAJAJ AUTO Scooter+Motorbikes+ Scooterate 25% market share

LMLScooter+Motorbike+Scootrate 30% market share

TVSMotorbikes+Scootrate 15% market share

YAMAHA Motorbikes15% market share

ENFIELD Motorbikes10% market share

According to the recent results company (Hero Honda) registered a sales increased by 24.5% over the past years. Same month TVS also registered increase of 45% while the other companies are not enjoying quiet good increase in sales. While the whole industry registered an increase of about 17% only. So in present scenario the Hero Honda comes as the leader of whole automobile segment while there is immense competition in industry to get the highest market share.

VISION

&MISSION1.3 VISION & MISSION THE COMPANY

MISSION STATEMENT

IN PURSUIT OF EXCELLENCE

We, at Hero Honda, are continuously striving for synergy between technology, systems, and human resources to provide products and services that meet the quality, performance, and price aspirations of our customers. While doing so, we maintain the highest standards of ethics and societal responsibilities, constantly innovate products and process, and develop teams that keep the momentum going to take the company to excellence in the new millennium.

1.4.Performance of Hero Honda

What started out as a Joint Venture between Hero Group, the worlds largest bicycle manufacturers and the Honda Motor Company of Japan, has today become the Worlds single largest two wheeler Company. Coming into existence on January 19, 1984, Hero Motors Limited gave India nothing less than a revolution on two-wheels, made even more famous by the Fill it Shut it Forget it campaign. Driven by the trust of over 5 million customers, the Hero Honda product range today commands a market share of 48% making it a veritable giant in the industry. Add to that technological excellence, an expensive dealer network, and reliable after sales service, and you have one of the most customer-friendly companies.

This is proved by the companys sales over the years:

1985-86 43,000 units1989-90 96,200 units1998-99 5,30,600 units1999-00

7,61,210 units2000-01

10,29,555 units2001-02 14,25,195 units2002-03 17,78.392 units2004-05 18.95 132 units2005-06 21,75735 units

Customer satisfaction, a high quality product, the strength of Honda technology and the Hero groups dynamism have developed HTML scale new frontiers and exceed limits.

In the words of Mr. Brij Mohan Lal Munjal, the Chairman and Managing Director, We will continue to make every effort required for the development of the motorcycle industry, through new product development, technological innovation, investment in equipment and facilities and through efficient management.

PERFORMANC WITH HISTORYThe following are the historical facts of the company :

1984

Company incorporated.

Technical collaboration signed.

Foundation stone lay.

1983 - Shareholders agreements signed.

1985

First motorcycle (Model CD 100) produced.

1987

Engine plant started.

1,00,000th Motorcycle produced.

1989

Sleek model introduced.

1991

5,00,000th motorcycle produced.

CD-SS model introduced.

Economic times Hayward business school award for excellent Governance to Hero Honda Motors Ltd.

1993

Hero group sponsors Hero cup five nations cricket tournament

1994

Splendor model introduced.

1995

National Award for outstanding contribution to the development of Indian small scale industry (NSIC Award presented by President of India)

The analyst award 1995 presented to Hero Honda Motors Ltd. on being ranked 9th amongst the most investor rewarding companies in India.

1996

1000 motorcycle per day production started.

1997


Street model introduced.

Hero sponsored 6th women world cup cricket tournament.

1998


1st Hero Honda Master golf championship held at Delhi.

1999


CBZ model introduced.

7th World Cup Cricket tournament sponsored at England.

Most admired business Baron CEO award conferred upon the Chairman Brij Mohan Lal Munjal.

2001

Passion and Joy motorcycle launched.

One million motorcycles produced in one single year.

50,00,000th bike produced.

Winner of the review-2000-Asias leading companies award 2000.

National productivity award for the best performance in automobile and tractors.

Sir Jahangir Ghandy medal for industrial peace awarded to Brij Mohal Lal by XLRI Jamshedpur.

2002

Declared company of the year by economic times business award.

Chairman Brij Mohan Lal awarded the entrepreneur of the year award by Business standard.

Ambition launched.

2003

Declared company of the year by economic times business award for the second time.

Karizma the sports segment bike launched.

This all says about the golden past of the company and the company is going on to the path of success.

2005

Supersplender & CD Deluxe introduce

2007

Hunk are introduced

Highlights of Q2, FY'08-09

Total turnover(Net sales & Other Operating income)Rs 3202 crores, growth of 35.6 per cent Net profit after tax at Rs 306.30 crores, growth of 50 per cent EBIDTA margin for the quarter 13.58 per cent Total sales for Q2 stands at 9,72,095 units, growth of 28.5 per cent Total sales for H1 stands at 18,66,349, growth of 19.7 per cent Over 55 per cent share in domestic motorcycle market Launches first-of-its kind music video to celebrate 25 years of Hero Honda

New Delhi, October 21, 2008: Hero Honda Motors Ltd (HHML),

the world's largest two-wheeler company for seven consecutive years, today firmly reiterated its undisputed leadership in the domestic two-wheeler market with impressive bottom line growth for the second quarter (Q2) July to September - of this financial year (FY) 2008-09.

Even as the industry continued to face tough market conditions on account of uncertainty over interest rates and overall credit squeeze, the company reported 50 per cent growth in profit after tax (PAT) at Rs 306.30 crore for the second quarter. Hero Honda's profit after tax in the corresponding period last fiscal (July - Sept, 2007-08) stood at Rs 204.33 crore.

Total turnover (Net sales & Other Operating income) grew to Rs 3202 crore, a growth of 35.6 per cent over Rs 2361 crore recorded in the corresponding period last fiscal. The company has recorded an EBIDTA margin of 13.58 per cent in the quarter. The EBIDTA margin in the previous quarter (April - June '08) was 12.20 per cent.

The strong financial performance is in line with the company's better-than-industry top line growth. After posting a growth 11.38 per cent in the first quarter, the company kicked off the second quarter with a 39.8 per cent growth in sales in the month of July, and followed up with 26.8 per cent growth in August and 22.4 per cent in September. Hero Honda consistently keeps growing its share in the domestic motorcycle market, and currently enjoys over 55 per cent share.

Hero Honda's cumulative sales for the second quarter (Q2) this FY stands at 9,72,095 units - a growth of 28.5 per cent over Q2 last FY (2007-08). The cumulative sales for the first six months (H1) stands at 18, 66,339 units of two-wheelers compared to 15, 59,486 units sold in H1 in the last FY reflecting a consistent 19.7 per cent growth in cumulative sales.

Dr. Brij Mohan Lall, Chairman, Hero Honda Motors Ltd, said "We are happy with our financial performance. It gives immense joy to see this kind of results in the 25th year of our company. I wish to thank all our stakeholders customers, associates, dealer friends, ancillaries and also our joint venture partners Honda Motors Co for their continuous support."

Mr. Pawan Munjal, MD & CEO, Hero Honda Motors Ltd., said "Our numbers speak for themselves. Even in this volatile and competitive environment, our top line continues to outpace the industry growth, our market share is at an all time high, and the financial balance sheet is a delight all the factors which form the hallmark of a resilient company with cutting-edge management. We will continue to keep innovating in bringing in technologically-superior products, in our network expansion, in brand building, in our financial management, and in our communication."

"Going forward, we will have to keep a close watch on the commodity prices movement, and other factors such as inflation, interest rate scenario and availability of retail finance. These factors will play a crucial role in the industry growth in the subsequent quarters," he added.

Hero Honda has already rolled out its festive season initiatives, with the launch of four new models the all-new "Passion Pro" and three refreshes of its existing models - new CBZ X-treme, a selfstart version of Splendor NXG and the refreshed Pleasure. During the coming months, the company will further augment its product portfolio with new launches across segments.

Key Hero Honda brands continue to drive strong volumes across segments - CD Deluxe in entry segment, Glamour, the new Splendor NXG, Splendor + and Passion Plus in deluxe segment, and Hunk, CBZ X-treme and Karizma in the premium segment.

Celebrating its 25th year, Hero Honda released an innovative music video in the month of September. Titled "Hero Honda Dhak Dhak Go", and involving as many as eight brand ambassadors of Hero Honda, the music video has been receiving rave reviews.

Hero Honda recently won two very coveted awards - "The Most preferred Brand of two-wheelers" award at the recent CNBC Awaaz Consumer Awards 2008, and the "NDTV Profit Business Leadership Award".

HERO HONDA CLOSES CALENDAR YEAR 2007 WITH SALES OF OVER 33 LAKH BIKESHERO HONDA CONSOLIDATES MARKET LEADERSHIP WITH IMPRESSIVE GROWTH OF 15% IN MARCH08HERO HONDA CONTINUES GROWTH MOMENTUM WITH 9.5 PER CENT INCREASE IN MAY SALESHERO HONDA CONTINUES TO CONSOLIDATE MARKET LEADERSHIP WITH 27 PER CENT GROWTH IN AUGUST SALESHERO HONDA NET PROFIT ZOOMS 31% TO Rs 275 CRORE IN Q3 (FY 2007-2008)HERO HONDA PASSES ON EXCISE DUTY CUT BENEFIT TO CUSTOMERSHERO HONDA POSTS RECORD 6 LAKH-PLUS UNITS IN RETAIL SALES IN OCTOBER 2008HERO HONDAS POSITIVE PERFORMANCE CONTINUES IN NOV08HERO HONDAS SEPTMEBER 08 SALES JUMP 22 PER CENT HERO HONDAS STRONG SALES PERFORMANCE CONTINUES INTO 2008 REPORTS 13% GROWTH IN CUMULATIVE SALES IN APR-NOV08

ABOUT PRODUCTS

1.6 DETAILS OF PRODUCTS

CBZ

The Hero Honda CBZ (pronounced CeeBeeZee) is the latest offering from Hero Honda for

the Indian market. With a 156cc engine, the company claims that the bike has a top speed of

100kph within 5.6 seconds. Though the bike has the largest displacement engine, its top

Speed doesnt match up to many of its competitors. In all other respects, it is a bit too early to

Decide whether the CBZ will sell in the same numbers as the Splendor. Though the initial

Market response has been good, only time will be the final arbiter.

Technical Specifications

Engine : Four-stroke/petrol

Transmission : Four-speed

Engine Displacement : 156cc

Tachometer : Yes

Max Power : 12.8b hp@8000 rpm

Wheel base: 1,330mm

Ground Clearance: 160mm

Ignition : Electronic CDI

Dry Weight: 140kg

Fuel tank Capacity: 12.5itres

Battery: 12V

Max Torque: 1.26kgm@6500rpm

Bore x stroke: 63.5mmx49.5mm

Max Speed: 120kph

Front Tyre size : 3.25x19"

Rear Tyre size: 3.50x19"

SplendorA combination of style and economy makes the Splendor is a bike worth investing in. The

Latest from the Hero Honda factory offers both performance and looks. It has good looks,

Excellent handling characteristics and a smooth drive over any type of terrain, thanks to the

Changes in the suspension at front and near as well as the new frame design. All these features contribute to the Splendor being one of the best selling four stroke-two-wheelers in India. It also meets all the current pollution standards. A healthier beat, springy ride and overall low maintenance has aided in the record-breaking sales of this bike.




Engine Displacement : 97.2cc

Tachometer : No

Max Power : 7.2b hp@8500 rpm

Wheel base : 1,230mm

Ground Clearance : 159mm

Ignition : Electronic

Dry Weight : 100.3kg

Fuel tank Capacity : 10.5itres

Battery : 12V

F/R suspension : Tel Hydraulic fork

R/R suspension : Swing arm and Hydraulic damper

Max Speed : 90kph


Rear Tyre size : 2.75x18"

Street 100

The Street 100 is Hero Motor's latest two-wheeler on offer in the step-through category. The Hero Honda Street 100 is equipped with unique features like city-clutch, which is designed specially for city driving. It has rotary gears, which allow the rider to flip directly from the fourth gear to neutral once the bike has come to a halt, a must for the present stop-and-go traffic. A self-starter button comes as an option. The Street can be purchased with a variety of seat layouts and has options like a water pump, spray can, larger luggage tray, etc. Its major competitor is the much cheaper K4 from Kinetic. Major plus points that justify the higher price are the centrifugal clutch and the rotary gears. However, the liberal use of plastics negates much of the feel good factor and has hindered sales to a large extent.





Tachometer : N/A

Max Power : N/A




Dry Weight : 101kg

Fuel tank Capacity : 11litres

Battery : 12V

F/R suspension : Telescopic

R/R suspension : Swing arm and Hydraulic dampers

Max Speed : N/A



CD100SS

The CD100SS is designed for those who live life in the fast lane, rough and tough, for those who would love to take a bike on the stumbling village roads. It shares almost all components with the CD100, except for the additional reinforcement. With larger, reinforced shock absorbers, wider tyres, heavier body weight and engine guard, the Hero Honda CD 100 SS weights slightly more, resulting in some cut down in the fuel economy it offers. Minor problems of the CD100 have been rectified in the SS model. If you wish to ride into the hinterland, this is the bike for you.





Tachometer : No

Max Power : 7.0bhp@8000rpm




Dry Weight : 103kg

Fuel tank Capacity : 10.1litres

Battery : 12V

F/R suspension : Tel Hydraulic fork

R/R suspension : Swing arm and Hydraulic damper

Max Speed : 85kph



2516664320

Features:

Engine4-stroke, single cyclinder, air-cooled

Displacement97.2cc

Clutch typeManual

Clutch Primary-

Clutch SecondaryMulti-plate wet

Transmission4-speed constant mesh

Final DriveRoller chain

IgnitionElectronic

StartingKick starter

FrameT-Bone type

Suspension (Front)Telescopic hydraulic fork

Suspension (Rear)Swing-arm with hydraulic dampers

Dimensions (LxWxH)1885x770x1060mm

Wheel Base1210mm

Ground Clearance135 mm

Dry Weight95 kg

Tyres:Front/Rear2.50"x18"/2.75"x18"

Max.Power7.0 PS @ 8000 rpm

Max.Speed85 Kmph

Fuel Tank Capacity10.1 liter(1.3 ltr reserve)

Ambition 135 Features:

Engine 4 stroke

Displacement 133 cc

Maximum Power 11 BHP / 11.15 PS @ 8000 rpm

Maximum Speed 100 KMPH

Gears 5

Frame Tubular single cradle, diamond type

Tyres: (Front) 2.75 X 18

Tyres: (Rear) 3.00 X 18

HeadlightTrapezoidal 35 / 35 W

Fuel Efficiency55 KMPL

CD DAWN

Features:

Engine 4-stroke, air-cooled, single cylinder OHC Displacement 97.2cc Clutch Multiplate wet Gear box 4 speed constant mesh Frame Tubular double cradle Battery 12V - 2.5 Ah Head lamp 35W / 35W - Halogen bulb Suspension(front) Telescopic hydraulic shock absorber Suspension(rear) Swing arm with hydraulic shock absorber Wheelbase 1230 mm Dimensions (LxWxH) 1980x720x1045 mm Ground clearance 150 mm Kerb weight 108 kgs Tyre (front) 2.75 x 18-4 PR Tyre (rear) 2.75 x 18-6 PR Max power 7.4 PS @ 8000 rpm Max torque 0.79 Kg-m @ 5000 rpm Bore x Stroke 50.0 x 49.5 mm Compression ratio 8.8: 1 Starting Kick start

KARIZAMA.

If you look at the 223c mill of the Karizma, you can make out the familiar streak that runs through the engines on the CBZ and the Ambition. No prizes on this count as to the reason but the 223cc Karizma engine represents - for the moment - the maximum capacity this modular design theme can be taken to. The crankcase is of virtually the same size though the covers do have some detail differences and the engine mounts are the same as in the other two bikes and completing the picture are the scaled-up barrel (with an additional fin) and head. The single overhead cam motor features slightly under square cylinder dimensions with a 65.5mm bore and a 66.2mm stroke to give a 223cc swept volume. Hero Honda has designed in the latest convex-type combustion chamber (compression ratio being 9.0 : 1) for silent running and good power delivery while also giving it the latest Keihin VE 3EA constant vacuum type carburetor which also packs in the CCVI switch. The CCVI term stands for carb-controlled variable ignition timing which as it suggests actuates - via throttle position - one of two ignition maps, for low and high speed operation. This was one area which disappointed appreciably in the CBZ wherein the engine sounded and felt harsh as one went past the middle range but here this detail has eliminated such a glitch completely. Just for the record, the 223cc engine gets the latest version of Honda's AMI (advanced microprocessor ignition) system which incorporates a three tier, multi-stage digital ignition system.

The all aluminum alloy engine (with pressed-in steel liner) features an automatic cam chain tensioned, an air cut off valve (to prevent afterburning in the exhaust muffler) and like on the CBZ and Ambition, an air injection valve to keep tail pipe emissions in check. With all this and the extra cubic capacity, the Karizma engine develops 16.76bhp at 7000rpm and 18.35Nm of torque at 6000rpm. This is about 2bhp and 5Nm more than what the Pulsar 180 makes but the reasoning is that the engine had to be stress free and this fact holds true when out on the roads.Transmission is via a five-speed gearbox which has had its final drive ratios revised from those in the CBZ. A stronger multi-plate clutch is used to take care of the enhanced power and torque figures. This time round Hero Honda has not faulted and equipped the engine witan electric starter even though the kick starter to be actuated requires the front right footrest to be folded out of the way.ENGINE:

INCLUDEPICTURE "http://www.indiabike.com/roadtest/fullstar.gif" \* MERGEFORMATINET



INCLUDEPICTURE "http://www.indiabike.com/roadtest/halfemptystar.gif" \* MERGEFORMATINET TRANSMISSION:




INCLUDEPICTURE "http://www.indiabike.com/roadtest/halfemptystar.gif" \* MERGEFORMATINET PASSION PLUS

FEATURES:

Displacement97.2 cc

Maximum Power 7.5 Ps at 8000 rpm

Gear Box 4 Speed Constant Mesh

Clutch Multi-Plate Wet Type

Max. Speed 85 Kmph.

FrameTubular Double Cradle

Suspension(Front) Telescopic Hydraulic Fork

Suspension(Rear)Swing Arm with 5 step adjustable hydraulic damper.

Tyre Size (Front )2.75 * 18- 4 PR /42 P

Tyre Size(Rear )3.00*18-4/6 PR

Brakes (Front)Internal Expanding Shoes Type (130mm)/ Hydraulic Disc Type (Optional)

Brakes (Rear)Internal Expanding Shoes Type (130 mm)

Final Drive Roller Chain

Battery 12 V-2.5 Ah

IgnitionElectronic CDI

Starting Kick Starter

Wheelbase 1235 mm

Ground Clearance160mm

Length 1980 mm

Width 720 mm

Height 1060 mm

Kerb Weight 116 kgs.

Fuel Tank Capacity 12.8 liters (Reserve 1.1 liters)

Head light Halogen Bulb 35 W / 35 W

SUPERSPLENDOR

FEATURE OF SUPERSPLENDER

Engine

4-Stroke OHC, Single Cylinder, Air Cooled

Bore X Stroke

52.4 X 57.8 mm

Displacement

124.7 cc

Compression Ratio

9.1: 1

Max Power

6.72 Kw (9 BHP) @ 7000 rpm

Torque

10.35 Nm @ 4000 rpm

Max Speed

90 Kmph

Clutch

Multiplate Wet

Final Drive

Roller Chain

Ignition

Digital - CDI Ignition (AMI) Advanced Micro Processor Ignition system

Starting

Self Start

Frame

Tubular Double Cradle

Suspension

Front : Telescopic Hydraulic ForkRear : Swing Arm with Hydraulic Shock Absorbers

Dimensions (LXWXH)

1995 X 735 X 1095 mm

Wheel Base

1265 mm

Ground Clearance

150 mm

Kerb Weight

121 Kg

Tyres

Front : 2.75 X 18 - 4 PR / 42PRear : 2.75 X 18 - 6 PR / 48P

Brakes

Front Drum Type : Internal Expanding Type - 130 mm DiaRear Drum Type : Internal Expanding Type - 130 mm Dia

Fuel Tank Capacity

12 Ltrs. (Min)

Head Light

12V - 35W Multi Reflector Halogen Bulb - AC Type

HUNK

BRAND AMBASSADOR

The company signed the Indian skipper of cricket team Saurav Ganguly, Virendra Sehvag, Harbhajan Singh, Zaheer Khan & Yuvraj Singh as its brand ambassadors joining the add campaign together to promote Ambition. All of these celebrities are the member of Indian cricket team and very much popular in younger generation. In the last year with the launch of its new premium bike Karizama Hero Honda signed its new brand ambassador who is a cine star and is also very popular. He is Hritik Roshan.

Service Your Bike

Hero Honda has always taken a lead in terms of defining service standards in two wheeler industry with an aim to provide "Total Customer Satisfaction" for their valuable customers across the country and also internationally. We are constantly endeavoring to improve the quality of our service facilities at our Dealerships. The first and foremost step to achieve this was creating Automated Workshops at our Authorized Dealerships and Service Centers across the country.

Automated WorkshopsHero Honda has the largest chain of Automated Workshops providing service to their valuable customers by using latest service technology. Automated Workshops have standard layout, hydro electric motor cycle lifts, dust free engine rooms and use pneumatic tools and equipment to ensure quality repair in customers motorcycle. The workshop environment and usage of pneumatic tools increases mechanics efficiency and their motivation to provide quality service. The layouts have been standardized to ensure that there is a transparency of service. The customers can view their motorcycle repair while sitting comfortably watching TV or relaxing in the customer lounge. Workshop Automation has become a mandatory service standard for all Hero Honda Dealers and Service Centers.

TrainingThe regular Technical Training Programmes for Dealers Workshop staff to keep them updated and refreshed about the latest price technology, product technical details as well as service and repair procedures to handle customers motorcycle with utmost care as well as to provide them the service quality of highest order is a focus area at Hero Honda. Hero Honda has six (06) training centers across the country. There are 05 zonal training centers of Pune, Bangalore, Calcutta, Chennai and Delhi to take care of technical training requirements of dealers in each zone as well as local technicians. There is a National Training Center at Dharuhera to take care of all advanced level technical programmes for our dealers staff and our in house service engineers. Hero Honda keeps an organizing Dealers Mechanics Contest at Zonal Level and National Level to develop competitive spirit among mechanics as well as in the process to update their skills and product knowledge.

Customer ServiceHero Honda keeps on taking always-new initiatives to maintain its leadership on service as well as enhance customer satisfaction level on an ongoing basis. Some of the new initiatives related to customer service are as follows: -

Service Advisors at Dealerships Service Plus Scheme for customers Pre Paid Reply Cards Automated Mobile Service Workshops Mega Millennium Camps On the Job Training Programmes Local Mechanics Training

There are many more initiatives, which we keep on taking along with our dealers to keep our customers always in our mind on top priority.

Safety- "S4" Concept (Sales, Service, Spare Parts & Safety)Hero Honda is also launching very soon a novel concept and a very major initiative - Safety at their S4 Dealerships (Sales, Spare Parts & Safety)

Safety Education to motorcycle customers shall be an integral part of Hero Honda's motorcycle delivery process at the showroom. Customers shall be educated on Safe Riding techniques through various audio visual aids. Safety Instructors shall be imparting riding skills as well as education to the customers. Dealers shall also conduct a major programme in their respective towns with the association of local traffic police on a regular basis on safety education and correct riding techniques.

PROBLEMSPROBLEMS OF HERO HONDA Honda Motorcycles and Scooters, India can take away market share and cause joint venture to go sour. Hero is vulnerable in the joint venture because Honda Motor Company has so much power

Bajaj auto is a strong competitor.

Hero Honda automobile is a strong competitor

Hero is vulnerable in the joint venture because Honda Motor Company has so much power

PART-II

OBJECTIVE

2.1 OBJECTIVE OF THE STUDY

The study was done primarily with the following objective in mind.

To study the brands of Hero Honda & consumers perception with its competitors.

To know why people buy Hero Honda and why some people prefer other company.

To study the features of different brands that give a good idea of various products and services offered by the company.

To understand the competitive environment in which the company is operating and is desired to meet customer need and satisfaction.

To provide useful information to the company about the product features of various competing companies.

METHODOLOGY2.2 METHODOLOGY

The methodology used in conducting the research work on HERO HONDA with major emphasis on its sales and marketing strategies involve the following steps:

Why I have selected HERO HONDA only?

I have selected Hero Honda for my research project because it is the company that is growing day by day. It has maximum market share with comparison to its competitors. And it is the company that gives highest sales and it is also the highest two-wheeler manufacturer.

Defining the problem and deciding research objectives:Defining the objective is the most important part of any study process. Proper defining of the problem is a must for proceeding further with the research process. The type of study to be carried out, the questions to be raised, the sampling procedure to be followed, and the data to be collected, all depends on a correct understanding of the problem. Also, by clearly focusing on the real problem, the research job can be simplified and completed with the minimum cost, effort and data.

Identified problem or the objectives of the research discussed in the report are:

1. Developing the research plan:In this a plan was developed about how to collect the require information i.e. whom to contact for gathering the relevant data. Data is the foundation of all research. It is the raw material with which a researcher functions.

Therefore, it requires great care to select the sources of data. Data, or facts, may be obtained from several sources. Data sources can either be primary or secondary.

A. Primary data: Collection of primary data was conducted by visiting the people personally for the preparation of the report.

Questionnaire

B. Secondary data:The sources from which secondary data was collected:

Press releases of the company.

Newsletters and In-house journals.

Brochures and detailed descriptive leaflets

Magazines like Business World, Outlook, Auto India, etc.

Websites such as www.herohonda.com, www.google.com. These were the sources from which secondary data has been gathered. Most of the information presented in this report was extracted from the above data sources.

2. Research approach:

It means the way by which the information was collected. Visiting the various places of Delhi, getting the questionnaire filled by different individuals.

Beside this, frequent visit to the showrooms of the company was of great help to conduct the analysis and research work.

3. Contact methods:Instrument or Data collected Forms: It is the method by which data is gathered. It could be done through various instruments like questionnaires, observations, getting information from the staff members of the agency, contacting to the motor mechanics was sufficient enough to conduct the study.

4. Collection of information:

The primary information was collected by face-to-face and direct interviews with the peoples and the customers. They provide the relevant information regarding the profile of the company as compared to the other company in the Indian market. Most employees suggested visiting companys web site, as it was not possible for them to spare time from their busy schedules.

The secondary sources of information were various web sites of the companies, newspapers & magazines such as The times of India, The Hindustan Times, Business world, Auto India, etc.

5. Analyzing the information:The data collected was carefully analyzed. The research and analysis of the information has been done on the basis of various sales and marketing strategies adopted by the company during its tenure.

6. Reporting and conclusions and recommendations:

This is the most vital part of the work undertaken. After collection and analysis of data, it was recorded in the form as prescribed. The major part of the report is the findings. The finding also includes charts, tables and diagrams etc. The report also mentioned the limitations of the project undertaken. Then conclusion has been drawn out of the findings and various recommendations have been given at the end of the report. Certain tables on the basis of which the findings were made have been included in the appendices section followed by the bibliography.

SWOT ANALYSIS

SWOT Analysis

Environmental ScanInternal Analysis External Analysis Strength WeaknessesOpportunities Threats Strength of Hero Honda

Ability to understand customers needs and wants

Recognized and established brand name

Effective advertising capability

Weakness of Hero Honda

Hero is vulnerable in the joint venture because Honda Motor Company has so much power

Opportunity Hero Honda

Global expansion into the Caribbean and Central America.

Expansion of target market (include women)

Threats Hero Honda

Honda Motorcycles and Scooters, India can take away market share and cause joint venture to go sour .

Bajaj auto is a strong competitor.

Hero Honda automobile is a strong competitor

SCOPE OF THE STUDY

Hero Honda is spreading its wings and widening its business horizon to reach and serve customers at new centers in the year ahead. The company services are backed by a highly motivated and technology driven team to achieve customers need, product expertise and geographic reach.

The study is oriented towards the concept of different brands offered by Hero Honda and its competitors to its customers. The company has endeavored to move fast in providing market solution, which maximize customer needs and convenience, using multiple delivery channels in composing the agency network, service centers, lower service cost and increased efficiency.

DATA ANALYSIS

2.5 Analysis Sale of Hero Honda in Rural area and Urban area

In the survey of rural as well as urban area it is found that in rural area the sale of Hero Honda is less but in urban area it gives very exiting result. This may be because of the conditions of roads there.

Area

% of Respondents

Urban Area

72

Rural Area

28

PARTICULER AREAS OF RESPONDENTS

All the respondents were from different areas. The samples were taken from the mentioned areas for the survey. It was observed that the people of main town like to use Hero Honda as they like all features of it. And is according to there pocket

Areas

% of respondents

Motijheel

42

Maripur

12

Chatta Chock

26

Mithan Pura

14

Other

6

FAMILY INCOME OF RESPONDENTS

The income distribution of the families of respondents shows that the bike, which was considered earlier to be out of range for middle class families is now becoming very fast an article for them.

Family income (Rs.)

% of Responses

5000-10000

10

10000-15000

46

15000-20000

36

Above 20000

08

PERSONS WHO KNOW TO DRIVE BIKE

Almost every person know how to drive a Bike (In my Survey)

Response % Of respondents

Driving known 96

Driving not know04

FACTOR PROMPT TO BUY HERO HONDA

It should be stated that the performance is the most important factor followed by look. The possible combination and corresponding number of respondents are shown in the table below.

Features

% of respondents

Performance

18

Look

11

Availability

5

Price

1

Maintenance

4

Brand image

5

After sale service

6

HOW DID THE RESPONDENT CAME TO KNOW ABOUT THE BIKE?

The best media of advertisement (according to which the respondents came to know about the bike) is the ads on television. Friends & magazine are the other sources. Only 2 % of them came to know through hoardings.

Medium of Advertisement % of Respondents

Television 46

Magazine 36

Friends 14

Hoardings 02

Others 02

PURCHASE OF BIKE

Almost 94 % of the respondents say that they have purchased the bike by cash. Only 6% of the respondents say that they have purchased their bike through bank loans.

Purchase Type

% of Respondents

Cash Purchase

94

Hire Purchase

06

DECISION INFLUENCED BY

Maximum no. of the Respondents have taken decision to buy the bike on their own. After that their friends and parents influenced them.

Influencer

% of Respondents

Parents

16

Self

54

Friends

18

Relatives

08

Others

04

BIKES PREVIOUSLY USED

More than 60% were using Hero Honda CD100 bikes. They were followed by Yamaha RX100 & very little have chosen other bikes.

Previously Used

% of Respondents

CD100

62

Yamaha RX100

32

Others

06

RATING OF BIKES

42% of the respondents have rated as the best bike they have used, but it is facing a stiff competition from Pulsar & Fierro.

Bikes

% rating by Respondents

Splendors

38

Passion

08

Ambition

06

Pulsar

28

Fierro

14

Others

06

SURVEY REPORTThe Initial Quality Study of Two Wheelers in India

Which model of Motor Cycle would you recommend to your dear friend?

Does the basic reliability of two-wheelers measure up to the promises made by the manufacturer?

Where exactly is the quality lacking?Would they buy the same model again or more importantly from the manufacturers point of view would they advise Are buyers happy with the quality they get?

What is the trend over the years?

their friends to buy it?

So let the people know just how the two-wheelers fared on the road

WORKS: It quantifies the initial quality of two wheelers in the form of the universally accepted metric Problems per 100 vehicles (PP100V)

Ranks all the popular models as per their quality performanceLinks the quality findings with the customer viewpoint

Manufacturer-wise PP100V scores in Survey

Sr.No. Vehicle PP100V

1 Honda 1462 LML 1653 Hero Honda 1764 Kinetic 1835 TVS 1966 Bajaj 1967 Yamaha 223

Executive bikes scored less problems than economy bikeshowever simpler machines like scooters have the fewest problems

This year we classified motorcycles by the market as premium, executive and economy...

Amongst the bikes, we found the number of problems were lowest in executive bikes and highest in economy bikes.

Executive bikes (179 PP100V), then premium bikes (209 PP100V) and last were economy bike (230 PP100V).

Maximum Problems found in engine andtransmissions:

46% of the problems reported by customers were problems like high fuel consumption, starting trouble, erratic / rough gear shifting, noisy / loose drive chain etc. All these problems are related to the engine & transmission. Another 12% of the problems were attributed to miscellaneous aspects like battery discharged, stand hard to operate, etc. Perhaps this is the most complex part of the two wheelers and hence poses maximum challenge to the quality control guys in the manufacturing units.

ENGINE Trouble..

Splendors the largest selling executive bike from Hero Honda has reported the lowest number of problems with ENGINE (37 PP100V) closely followed by the newly launched geared scooter Eterno (38 PP100V) from Honda.

Simplicity is the beauty

TRANSMISSION WOES:Gearless scooters/scooterettes have lowest number of TRANSMISSION problems. Complains who fulfilled the promised performance and how much? Sl No. Manufacturer % models above category average 1 Honda 100 2 LML 100 3 Hero Honda 67 4 Bajaj Auto 43 5 TVS 33 6 Yamaha 33 7 Kinetic 25

SCOPE AND COVERAGE:

Manufacturers and their Models: Sr.No. Manufacturer List of models studied * Bajaj1 Boxer2 Caliber 1153 Pulsar 150 / 1804 Spirit

*Hero Hondaf5 Ambition6 CD-100 / SS / Dawn / CD Dawn7 Splendor / Passion *Kinetic Engineering

8 Boss *LML9 Freedom

*TVS

10 Max 100 R / DLX / DC

11 Victor *Yamaha

12 Crux / Crux R13 Enticer14 Libero

Aggregates and features covered:

Overall Satisfaction Overall quality Instrument Panel / Dash Board Locks Control knobs / Switches Handle Lights Body Transmission Engine Wheels Riding

FINDINGS2.6. FINDINGSIt is clear from the report that the Hero Honda Motors is facing cutthroat competition; hence the companys manager has to be fast and smart so as to understand the customers needs. They have to come up with various new techniques or schemes to be able to cater to different categories of people.

Customers are becoming more wise day by day and they are now willing to know all the in and out of the things happening around them. This has led to increased customer awareness.

We can analyze that if the brand is reputed that doesnt win the customers delight unless its provided same value-added features or else we can say competitive advantage.

For gaining a competitive advantage it has to continuously compare the product and services with the competitors and find the weak area of the rivals for gaining competitive advantage.

Surveys revealed that awareness of Hero Honda Motors is low among its target segment for creativity awareness. The company has to take some keen step for promotional activity.

The company should regularly send the sales person who have good communication skill to the customers so that they should be aware about the product and services in market and know the quality of the services offered by the company.

CONCLUSIONS2.9. CONCLUSION

The Indian two wheeler industry today offers more than 70 models to a buyer. And manufacturers are launching new models every day More than 20 models were launched in the last year.

Top this up with a variety of promises ranging from free gifts and financial schemes to the attractive looking models and jingles in the advertisement.

In this whirlwind of speed and confusion maze, choosing the right pair of wheels can be a trying experience for the common man.In such a situation, the buyer has to first narrow down his search to a given category of two wheeler. A lady doctor may decide to look only at gearless scooters while a collegian with a rich father may only look at premium bikes.Most of youngster preferred stylish and good looking bike which are high capacity engine

In rural area most of people preferred high mileage and comfortable bike. Lesser problems per vehicle for a given model could be a good enough reason to go for the model..? Yes! But, within my selected category of premium bikes So which premium bike has lesser problems? Do new launches have more problems than older ones? Naa! Does PPM score depend on who manufactured the vehicle? See for yourself!

RECOMMENDATION

2.7. RECOMMENDATION

While Hero Honda has strong foothold in the industry, the company should look into the areas of weakness.

In this connection, It is suggested that the company can look into the following areas:

In order to expand its business it should introduce innovative schemes for young generations, better financial schemes, etc.

The company should expand its service centers.

The must move towards the rural areas to expand its sale.

LIMITATIONS

2.8. LIMITATIONS OF THE STUDY

As said a basic research was conducted at the company to enable the company to assess how far the customers are satisfied with product and services of Hero Honda. During the course of the study the following limitations were observed:

The method will be unsuitable if the number of persons to be surveyed is very less as it will be difficult to draw logical conclusions regarding the satisfaction level of customers.

Interpretation of data may vary from individual depending on the individual understanding the product features and services of the company.

The method lacks flexibility. In case of inadequate or incomplete information the result may deviate.

It is very difficult to check the accuracy of the information provided.

Since all the products and services are not widely used by all the customers it is difficult to draw realistic conclusions based on the survey.

ANNEXURE

Questionnaire

Questionnaire for the survey of Motorbikes.

1. Name __________________________________________________

2. Address _____________________________________________

_____________________________________________

3. Phone No. ___________________

Mobile No. ___________________

4. Age

18 22 years[ ]

23 27 years[ ]

28 32 years[ ]

above 32 years[ ]

5. Do you have any bike in your house?

Yes[ ]

No[ ]

6. If yes, Name and Company of the bike.

________________________________________________________.

7.If No, Do you have any plan to buy it in next 6 months?

Yes[ ]

No[ ]8. If Yes, Name and Company of the Bike.

________________________________________________________.

9. Which Bike does you like most?

________________________________________________________.

10. Rank the Motorbike manufacturing company.

1.Hero Honda

[ ]

2.Yamaha

[ ]

3.Bajaj

[ ]

4.L.M.L.

[ ]

11. Do you remember any advertisement of Hero Honda?

________________________________________________________.

12. What should the price range in your opinion?

Splendor +___________________

Sufficient[ ]

CD dawn___________________

Sufficient[ ]

CD100 ___________________ Sufficient [ ]

Passion +___________________

Sufficient[ ]

CBZ

___________________

Sufficient[ ]

Karizma___________________

Sufficient[ ]

13. Any new facilities or any improvement that you want.

________________________________________________________

________________________________________________________________________________________________________________.

14. Give remark to your old Bike Company.

Good

[ ]Very Good

[ ]

Excellent [ ]Out standing

[ ]

Dont have a Bike

[ ]15 Give remark to Hero Honda.

Good

[ ]

Very Good

[ ]

Excellent [ ]

Out standing

[ ]

Dont have a Bike [ ]

Thanks

Surveyed by:

Checked by

BIBLIOGRAPHY

BIBLIOGRAPHY

BOOKS:

Marketing Management by Phillip Kottlar. Marketing Management by T.N.Chabbra. Marketing Research by B.C.Goel.

MAGAZINES, JOURNALS AND NEWSPAPERS:

Journals published by Hero Honda,

Annual Report

Auto India,

Business World

INTERNET:

www.herohonda.com www.google.com

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Performance1818

Look11Cash Purchase4747

Availability5Hire Purchase3

Price13

Maintenance44

Brand image55

After sale service61

Driving known96

Driving not know4

P G D M21

M C A6

B B A13

B C A7

Other3

5000-100005

10000-1500023

15000-2000018

Above 200004

Television23

Magazine18

Friends7

Hordings1

Others1

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Price13

Maintenance44

Brand image55


P G D M21

M C A6

B B A13

B C A7

Other3

5000-100005

10000-1500023

15000-2000018

Above 200004

Television46

Magazine36

Friends14

Hordings2

Others2

Sheet1

0

0

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0

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_1321210103.xlsChart1

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18

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Parents168

Self5427

Friends189

Relatives84

Others42

Sheet1

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_1321210105.xlsChart2

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32

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Parents88

Self2727

Friends99

Relatives44

Others22

CD1006231

Yamaha RX1003216

Others63

Sheet1

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_1321210108.xlsChart3

38

8

6

28

14

6

Sheet1

Parents88

Self2727

Friends99

Relatives44

Others22

CD1003131

Yamaha RX1001616

Others33

Splendor38

Passion8

Ambition6

Pulsar28

Fierro14

Others6

Sheet1

Sheet2

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_1321210101.xlsChart8

94

6

Sheet1

Performance1818



Price13

Maintenance44

Brand image55


P G D M21

M C A6

B B A13

B C A7

Other3

5000-100005

10000-1500023

15000-2000018

Above 200004

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0

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0

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Performance1818

Look1111

Availability55

Price16

Maintenance44

Brand image55


P G D M21

M C A6

B B A13

B C A7

Other3

5000-100005

10000-1500023

15000-2000018

Above 200004

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12

26

14

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AreaNo. of Respondents

Inner Hostel36

Outer Hostel14

Motijheel42

Maripur12

Chatta Chock26

Mithanpura14

Other6

5000-100005

10000-1500023

15000-2000018

Above 200004

Sheet1

Sheet2

Sheet3

_1321210092.xlsChart5

10

46

36

8

Sheet1


Inner Hostel36

Outer Hostel14

P G D M21

M C A6

B B A13

B C A7

Other3

5000-1000010

10000-1500046

15000-2000036

Above 200008

Sheet1

21

6

13

7

3

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72

28

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Urban Area72

Rural Area28

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No. of Respondents

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Arif Report

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Transcript of Arif Report