21. 2 wheelers form the bulk of exports as well, but are losing share to Passenger vehicles
22.
23. THE COMPANY’S MARKETING ENVIRONMENT The Economy Social Factors Suppliers Demography Distributors & Dealers Company Public Customers Cultural Factors Competitors Political & Legal Technology
24. THE EXTERNAL ENVIRONMENT There is a need to identify the uncontrollable key factors that will impact on the organization's operations. The best known method is the SLEPT analysis. 8 Economic environment Political environment The organisation Social environment Technological environment Legal environment
25. (B) MACRO-ENVIRONMENT Natural Forces Technological Forces Economic Forces Political Forces Demographic Forces Company Cultural Forces “ It is useless to tell a river to stop running; the best thing is to learn how to swim in the direction it is flowing”
26. MACRO-ENVIRONMENT An organization’s success depends on the ability of its executives to manage its marketing system in relation to its external environment. These forces (macro-environmental forces) are uncontrollable and pose opportunities and create threats for the company. TODAY YOU HAVE TO RUN FASTER TO STAY IN THE SAME PLACE.
48. Net Substantial Effects Net effects- passenger car makers have been operating below capacity for a while. Recently, Maruti closed one of its plants for two days. Other volume players like Tata Motors and Mahindra & Mahindra (M&M) have been adjusting production to tide over the lean season. Honda Motorcycle and Scooter India have put off their plans for a second plan Ford Motor India had recently announced a fresh investment of Rs. 2100 Crore, however now that plan is only being carried forward in a tentative manner. Tata Motors’ profit figures for the most recent quarter (second quarter of FY09) was the worst ever for the company in the last six years.
49. How To Approach the Issue Look towards frontiers out of India- Ashok Leyland recently said quite emphatically- “Leaving aside the large demand markets, which also have large manufacturers to support themselves, there are still 45% of developed markets left for our company to explore. This is especially when there is an estimated 1:4 advantage in development cost that Indian greenfield projects enjoy over European ones,” Exports to neighboring countries and the Middle East have grown by 20-25% The Jaguar and Land Rover companies owned by the Ford Motor Company was acquired by the Tata Motors Ltd for estimated price of US$ 1.5 billion The Maruti Udyog Ltd has captured nearly 60% of the small car market in Indonesia Innovation- TATA Motors and M and M. The former, for instance, is closely looking at the option of launching electric vehicles and hybrid versions- Tata Motors is in dialogue with Norway-based Miljobil Grenland to develop an electric vehicle on the Nano platform and with Chrysler for the Ace
50. Overall Economic Outlook Although the Indian Auto Industry is in a slowdown phase- this is part of cyclical cycle and therefore this slowdown is not a great matter of concern according to experts such as T. T. Srinivasaraghavan, Sundaram Finance. High demand should eventually overpower these current forces- this is mainly because Indian consumers are still “Demand Hungry” and their net “purchasing power” is on the rise.
51. TECHNOLOGY Greater emphasis on R & D Accelerating the pace of change Innovation Increased regulation of technological change
53. Regulations Safety Technology Wheel lock up Additional breaking force Air Bag Frontideear end collision Whiplash Injury lessening Vehicle stability control
54. Acceleration of change Assembly line Product life cycle reduced Better technology at a lower price
55. Research and development – auto industry Global auto and component makers invest between 5 and 8% in R&D. Spending on R&D in India up from 243cr to 954cr in past four years. Cost advantage India offers makes more players likely to scale up R&D outsourcing to India. GM, Daimler, Volvo, Honda and Bosch are scaling up R&D investments out of India. “Indian engineers are very efficient and have a sense of frugality” – executive VP(product planning) ,Renault
56. Cost advantage India offers makes more players likely to scale up R&D outsourcing to India. GM, Daimler, Volvo, Honda and Bosch are scaling up R&D investments out of India. “Indian engineers are very efficient and have a sense of frugality” – executive VP(product planning) ,Renault Research and development – auto industry
57. Increasing role of IT in automotive space a) apart from IT support systems like supply chain management , CRM - IT companies are developing solutions for the automotive sector. b)“making automobiles more intelligent like building collision avoidance systems ,engine management systems and even entertainment features in cars” $1bn auto vertical has the potential to grow to $50 - $60 bn by 2020. This requires the 3 stakeholders – global auto firms, their Indian counterparts and IT companies to get into collaborative research.