RESEARCH REPORT ON THE TITLE “COMPARITIVE ANALYSIS OF HYUNDAI SANTRO” SUPERVISING PROFESSOR PROF. PIALI HALDER PREPARED BY HIMANSHU SINGHAL PGDBM 2006-08 2K62A17 Email Id:[email protected] co. in ASIA PACIFIC INSTITUTE OF MANAGEMENT 3- 4 INSTITUTIONAL AREA, JASOLA, NEW DELHI. Acknowledgement I take this opportunity to express our deep sense of gratitude to our respected mam, Ms. Piali Halder, for the valuable guidance, keen interest and helpful criticism, during the project work.
I would also like to extend our thanks to Mr. Anmol Juneja of Maruti Suzuki for providing all the necessary help and support. Mr. Arvind Saurabh, Hyundai Motors Ltd was also kind enough to provide us with valuable insights in the project. Mr. Bakshi of Tata Motors has also been a great help in understanding the mechanism of market research. Last but not the least I would like to thank our friends, teaching and non-teaching staff and others who have directly and indirectly helped in the successful completion of the project 2
Index • Car Industry • Sales Trend of Cars In India • Hyundai – Company Profile • Literature Review • Santro Xing o Pricing Strategy o Place o Promotion • STP – Hyundai • Market Research • Competitors • Conclusion • Bibliography • Appendix 4 4 5 11-13 14-18 19 20 – 32 33- 39 40-42 43 44-45 3 Car Industry If there is one big market that is forcing the global auto majors to think small, it is India. Until yesterday, all the world’s auto-manufacturers expected to create success out of their mid- size products The Indian car industry as we know today is relatively recent in origins.
Except the ambassador and the Premiere Padmini’s there was not much moving around with an Indian Tag. As a result of the liberalization the capacity of car production has increased substantially in the last four years and is expected to grow manifold in the coming years. The Indian car industry can be classified based on the price of the car: Those automaker and auto marketers having their business in India have to understand the mindset of Indian customers buying cars. “Automakers are to think globally and act locally” Indian customers can buy imported cars but obviously they have to drive on Indian roads.
The factors that have plummeted the sales of car industry in India are the increase in disposable income of the people. The other major driver of growth is the easy availability of auto finance. The increase in competition in this industry has resulted in decline in equated monthly installments (EMI), the increased tenure, decline in interest rates in retail finance in general and auto finance area. 4 The automobile policy of the Indian Government has also proved to be a major factor in the growth of sales. With steep decrease in excise duty India is on the path to be hub for small cars. Sales trend of cars in India 900 000 800 000 700 000 600 000 500 000 400 000 300 000 200 000 100 000 99 00 0 1 0 2 0 3 0 4 -2 0 2 0 0 9 0 0 0 0 0 -2 05 0 8 -1 -2 -2 -2 1 9 0 2 -2 3 2 0 0 9 9 0 0 9 9 0 0 1 1 2 2 There has been a constant rise in the sale of cars. The Indian car industry is on the way up with the sales reaching 8,20,000 units approx compared to 7,00,000 last year. 2 0 0 6 4 Company profile Hyundai Motors India Limited “I believe that the primary reason for HMIL’s success is that we never allowed ourselves to be complacent.
We were continuously innovating at the marketplace, taking ourselves head on the competition. ” – YS Kim, former Managing Director, Hyundai Motors India Limited Hyundai Motor India Limited (HMIL) is a wholly owned subsidiary of Hyundai Motor Company, South Korea and is the second largest and the fastest growing car manufacturer in India. HMIL presently markets 35 variants of passenger cars in six segments namely- the Santro in the B segment, Getz in the B+ segment, the Accent and Verna in the C segment, the Elantra in the D segment, the Sonata Embera in the E segment and the Tucson in the SUV segment.
HMIL’s fully integrated state-of-the-art manufacturing plant near Chennai boasts some of the most advanced production, quality and testing capabilities in thek country. HMIL was declared “The Star Company” amongst unlisted companies by Business Standard this year. Getz got the coveted “Car of the Year 2005” award twice over. It was declared a winner by both Business Standard Motoring and CNBC-TV18 Auto car Auto awards. 7 HMIL was also adjudged the “Manufacturer of the Year” two years in a row in 2002 and 2003.
ICICI Overdrive Awards declared Hyundai as the “Car Maker of the Year” in 2003. Hyundai products with state of the art technology have also been winning many accolades over the years. Santro bagged top honors in JD Power Asia Pacific for three years. The Hyundai Santro was born to meet the typical Indian environment including road condition, extremely high temperature, tough weather, heavy traffic and difficult driving conditions. It is claimed that the Santro would require less preventive maintenance which means saving of cost, time and efforts to Indian customers.
In order to complement the hi – technology Santro, Hyundai has in place a rapidly expanding and well structured after sale network across the country. HMIL has also been awarded the benchmark ISO 14001 certification for its sustainable environment management practices. The production process is based on new and updated technology which ensures Total Quality Management. 8 Milestones on the road to success • Hyundai Motor India completes a decade of success in the country • Hyundai Motor takes giant step towards Corporate Social Responsibility • Hyundai Motor launches Global No. Quality and Brand Image Campaign • Dekhte Hi Dekhte Dus Lakh – Ten Lac cars sold • Hyundai Motor makes Delhi road safer • Tennis Ace Sania Mirza was presented her very own Hyundai Getz by Hyundai Motor India Senior Vice President, Sales, Mr V D Bhasin, at a ceremony in Hyderabad today. Getz will be the first car to be driven by Sania Mirza.
• Hyundai launched Sonata Embera – Drive into a New Age • Hyundai launched Tucson – Your Spirit of Adventure • Hyundai Motor India’s Dealer Conference in Istanbul 9 Hyundai Motor India launched the Accent Viva CRDi on Jan 15, 2004 at the Auto Expo 2004 organised in Pragati Maidan from Jan 15 – 20, 2004 • Hyundai Motor India rolled out its 500,000th car from its factory near Chennai on 11th December 2003 • HMI’s Santro Xing marks Europe debut at the Frankfurt Motor Show • Hyundai Sonata Hole in One Challenge • Swar Utsav -The Ultimate Music Festival of India • Hyundai Sonata Maharaj Sir Pratap Singh Polo Cup – 2003 • Launch of the book ‘The Automobiles of the Maharajas’ 10 LITERATURE REVIEW Santro Xing “A New Shining Dawn.
Here Comes the Sun Again” Santro has proved to be the best compact car in India, thanks to its excellent design and extensive testing for over 100,000 kilometers in real Indian road and climate conditions Santro after being a run away success was renamed as Santro Zip Drive and then another replacement as Zip Plus. HIML then launched Santro XING with state of the art technology. Xing had new aerodynamic styling, power-assisted brakes, the advanced suspensions; the uniquely responsive technology is as much a magnificent creation to delight as a benchmark in engineering excellence.
Santro is being produced exclusively in India and the Indian Xing will now drive the World. The Xing was Tall, wide and uniquely different. While its sleek lines and pleasing curves and contours pleased the customers. The compact outer 11 dimensions, combined with its sporty stance added some passion for driving. Santro Xing features the world class McPherson Strut Suspension with a stabilizer bar in the front and a torsion beam axle with 3-link offset coil springs and hydraulic dampers in the rear.
This provides a smooth ride on the pot-holed Indian roads and the wider tyres ensure surefootedness even on slippery surfaces. The new Santro Xing had all new looking feel exterior and interior styling. That, coupled with new advanced features, offers the best comfort & luxury in India’s favorite compact car. New bigger & brighter clear headlamps, smiling radiator grille, power operated rear windows with child lock and lots of other smart features like the seat under tray are the hallmarks of your Sunshine Car.
Variants of Santro Xing: Hyundai Motor India has launched three new variants of the Santro Xing with eRLX technology, new interiors and a cheaper price tag. The new Santro Xing variants – XK-Non AC, XK and XL – will have the latest 1. 1 liter engine with eRLX Active Intelligence technology, which gives class-leading low-end torque resulting in better pick-up, better fuel efficiency, lower maintenance and enhanced engine life, claims Hyundai Motor India Where the Xing scores over other cars is in the engine department. Its 1086 CC inline-four makes 62 bhp, enough to take the little car all the way up to 145 kph.
The five-speed gearbox is notch-free. 12 The new Santro Xing had enhanced security and safety features which included Child-Safety Rear Door Locks, Seat Belts – Front and Rear. It also had new and better exteriors like clear lamps for both front and rear side, a new wheel cover was provided along with the car to enhance the look of the tyres. The car’s interiors had been changed keeping in mind the new image, they changed the steering wheel with more spokes on it and also molded roof lining, front and rear speaker grill, ash tray and room lamp.
The instrument panel was also redesigned with electronic trip meter and a low fuel warning to make users aware of the fuel level. The seats were made keeping in mind the comfort of the passengers where the seats in the rear could be folded to accommodate luggage. 13 Pricing Strategies The strongest factor that was in favor of the newly introduced Xing was that it represented excellent value for money. Even though it had the latest technology and extra features it was priced below the price of its competitors. The strategy of the company in the initial few years was not to make profit but to gain market growth.
The New Santro Xing was launched with a cheaper price as compared to its previous versions Santro Zip and Santro Zip Plus. The Xing was priced at 2. 79 lacs (Ex-showroom price New Delhi) for the base model. The car was priced keeping in mind the middle income group which is in majority in India. Hyundai Motors had tie ups with different financial institutions like ICICI car loans and HDFC Bank to provide easy loan facilities to the customers, to get cars on easy installments. The interest rates were kept low to encourage customers to buy the cars.
The company offered discounts to reduce the burden on the customers. The tax paid to the government for the road and registration was done at a discounted rate with the company paying some amount of it. Even the insurance premium for the first year was paid by the company so that the customer did not bear the burden of the charges. The company offered extended warranty which the customers could avail by paying a nominal amount. These practices of Hyundai 14 Motors assured that the customers got the car at the prices mentioned without having to pay any extra charges on it.
The increase in the prices of steel and some government taxes on the manufacture of small cars led to a hike in the price of the cars. The new price was 3. 5 lacs for the base model and moved up depending upon the higher model. The increase in the price did not affect the demand much as the overall price was increased by all the companies by some amount. To regain its lost ground, Hyundai launched a new scheme under which Santro Xing XE (S) variant would be available for Rs 3,00,001, only between November 8 and November 10 2004 on the occasion of Diwali.
In August 20041, “Hyundai Motors India Limited (HMIL), an Indian subsidiary of the South Korea- based Hyundai Motors Company (HMC) was expected to reduce the price by as much as Rs 40,000. Industry experts were expecting a reduction in Santro’s price in response to the price war being waged by the market leader in India – Maruti Udyog Limited (MUL), which had reduced the price of its largest selling car in the B segment Alto – by Rs 58,000 in two price cuts starting from September 2003. This move had resulted in Alto replacing Santro as the largest selling car in the B segment in the period January to June 2004. 15 Prices of Different variants of Santro Model XK Non A/C XK A/C XL XO AT ExShowroom 270,222 327,848 349,432 373,883 418,332 Santro Registration ; Tax 7,974 9,127 9,559 10,048 21,303 Insurance 10,273 12,290 13,045 13,901 15,457 On Road Price 293,719 354,515 377,286 403,082 460,342 16 Promotion The company planned to leave no stone unturned to advertise the launch of Santro Xing. The company had supposedly earmarked Rs 15-20 crores as marketing budget for the launch phase alone. Various media channels were applied for the same like broadcast media, print media, banners, hoardings and holding of events.
Thus, Hyundai has promoted its products through the entire possible medium. The association of Shahrukh Khan as the brand ambassador of Santro made it a huge success. The experts believed that the humorous endorsements of King Khan coupled with the new technology have catapulted Hyundai as one of the most visible, talked about and debated brands in the country. The personality of Khan as a fun-filled and mischievous person was an instant hit with the masses The 17 presence of Khan proudly peddling the Hyundai brand and car as the “Sunshine” thing has always added a lot of zing to the brand equity of Hyundai.
The promotion of Santro Xing started with the teaser ads showing Shahrukh Khan handing over the keys of Santro to Mr. Kim of Hyundai. Khan is left stranded on the street alone just when Mr. Kim returns with the all new Santro Xing and hands over the keys to him. In another advertisement, Shahrukh Khan is seen asking his family members about their choice of colour of the Santro. A little girl gives away her piggy bank saving for a ‘maroon car’. Where the whole family wants the black car, Khan gets a maroon car for the little girl and the baseline is “hoga har sapna sakaar” Segmentation, Targeting and Positioning (STP) of Hyundai
HMIL has divided its customers on the basis of age and income group. They distinguish between car buyers who are primarily seeking a luxurious driving experience, and those seeking driving thrills and performance. HIML recognized the needs of the middle income groups and their likes and dislikes about the car. Xing attracts the customers through “Niche marketing segment”. In this the customers are first divided into segments and then sub-segments. A basic model of the car which is XL Non AC caters to the customers who are brand conscious but do not care much about the comfort a car provides. 8 The other models are also according to the taste of the customers, their importance to luxurious driving etc. Once HIML decided the different segments, it then focuses upon the target customers and brought about price variants on models. The target customers were then offered discounts, scratch cards and other promotional schemes. The positioning was done in the market seeing the customers and HIML’s positioning is well placed that can easily be derived from the fact that 33% of the total market is captured by Hyundai. 19
Market Research Problems, decision alternatives and objectives: The problems identified are • the stiff competition Hyundai faces from its competitors • to increase the customer satisfaction Research Plan: Data Sources: • Primary: Company Survey, Questionnaire • Secondary: Internet, Magazine*, Newspapers and Journals* (* Details given in bibliography) Sample unit: We targeted those people who had small cars and were looking to buy a new one Sample Size: We Surveyed 50 people. Sample Procedure: Probability: We used the random method to conduct our survey. 20 Information: We have collected their response and gathered them together.
Every person’s opinion has been counted in our survey Analyze Information: Based on the information collected we have analyzed the facts 32 % people said that Hyundai is the first name that comes to their mind when they talk about cars as compared to 52% said Maruti. Brand Others Maruti Hyundai Tata Frequency 6 52 32 10 21 Customer care and better service is what attracts the customers to the showroom. 21% people said that the customer care provided by the Hyundai was the best. Responsible Employees 13% No Idea 6% No difference 15% Customer Care 21% Genuine Spares 1% Valid 1% Better Service 20%
Valid Better Service Customer Care Genuine Spares More Trusted No difference No Idea Responsible Employees More Trusted 23% (Factors that matters to Hyundai customers) 22 39% of the customers said that the car should be luxurious to drive and the other major driving force was the size, meaning small attractive model. Comfortable 2% Easy Maintainance 14% Cost effective 16% Luxurious 39% Luxurious Small attractive Cost effective Easy Maintainance Comfortable Small attractive 29% (Factors that decide the purchasing of car) 23 Advertisement on TV was the main source of information while the other print edia has been catching up fast. Word of mouth 23% TV 26% Websites 5% New spapers 22% TV Websites New spapers Magazines Word of mouth Magazines 24% (The Information Media) 24 Findings: 1. In the ranking for main purpose of the car the factor that scored the highest importance were: 1. Necessity 2. Convenience 3. Comfort 2. 16. 9% biased towards Hyundai due to its driving convenience and AC. Hyundai was being perceived only by 11% customers who were in the age group of 31-40 3. 48. 5% consumers of cars (even other brands) found the pricing of Hyundai cars to be satisfactory and reasonably priced.
On an average, we could conclude that the customers were satisfied with the pricing structure of Hyundai cars. 4. Hyundai’s outlet (HMP) is believed to be trustworthy for the service being provided compared to other dealers. This was the opinion of 23% consumers. 21% perceived that customer care would be much better own outlets rather than the dealers 5. About 27. 2% of the consumers preferred to buy Hyundai in future followed by 17. 6% of them preferred to buy Maruti brands and 13% were will to buy other cars 25 6. Auto magazines are the primary media sources. Majority of the people refer to them to gather information about cars. 6 Competitors and their Strategies The Hyundai faces tough competition from the following brands: • Maruti Suzuki, Wagon R • Tata Motors, Indica • Fiat, Palio 27 Comparative Table of the competitors (Cost) Xeta GLG Cost Price factors Ex-showroom price Insurance Registration Num plate/Other charges Under body treatment Paint protection Sub Total 320800 11842 9220 0 2530 2900 347292 Cost Seasonal discount Extra Central locking w/remote OEM MP3 Player Car Cover NO NO 0 4200 YES NO WagonR Lxi Cost 356548 13105 10216 750 2530 2900 386049 Cost -35000 NO 1400 Santro Xing XL Cost 348191 12661 0 400 2530 2900 366682 Cost 0
Freebies NO, dealer 0 gift NO 9000 NO, dealer 0 gift NO, dealer 0 gift NO NO 2500 0 28 NO 9000 NO 400 NO 400 Seat Cover Exchange bonus NO YES 2500 0 NO, dealer 0 gift YES -3500 Corp Discount NO Full set mats YES Mud flaps YES Addi. Cost/Discounts Net on road 0 0 0 6700 YES YES YES -2000 0 0 -23700 NO YES YES 0 0 0 5900 Xeta Cost GLG Ex Cost + Reg 347292 + Ins + etc. Min. Added Benefits/Costs 6700 (see above) Net on road 353992 WagonR Cost Lxi 386049 -23700 362349 Santro Xing Cost XL 366682 5900 372582 29 Strategies of the Competitors) Promotio n Tata Indica More car per Car” “More dreams per car” “Forget small cars, we even make big cars feel small” “50cc moped, 100cc bike 800cc car. Time you asked for more. ” Price Indica offers a vast range of price for its customers. The petrol version ranging from Rs. 252,458 to Rs. 4,11,792 for the top model of the diesel version. Tie ups with different banks and financial institutions to provide hassle free loans at lowest possible interest. “the peoples car” Fiat introduced a new “tall boy design” range of Palio with Sachin’s signature on top. Price ange Price Range: Palio between Rs. Diesel EL Rs. 4,19,500. 325612 for the base model of – Rs. 6,99,000 WagonR to 408937 for the fully loaded top model Interest rates as low as 9%4 and financing up to 90% of on – road prices. Tie up with State bank of India to provide loan facility Maruti WagonR “Made in India”. Fiat Palio Sachin Tendulkar, the major architect of sales. 30 Place Has a well maintained and integrated dealer network and retailers to reach the remote areas. Huge dealer network and has the biggest and after sales service. Its service station expands to the length and breadth of country
Limited dealers and service stations installed along with the showrooms 31 Market Share of Hyundai and Competitors Tata 10% Others 9% Hyundai Xing 32% Hyundai Xing Maruti Tata Others Maruti 49% Hyundai Xing has a 32% market share with only Maruti as a competitor 32 Maruti Udyog Limited WagonR Customer Service After-sales service for cars is as critical as showroom deals. Maruti services its 2million customers through an army of 174 dealers spread across the length and breadth of the country. It will be impossible for a company to duplicate such infrastructure, particularly with investments in a metro-based showroom going up to Rs 4 crores.
The problem of price war is evident with Auto majors as much as with dealers. In a bid to woo the customers, Maruti dealers, particularly in non-prime locations, are cutting their margins. 33 Doing so will benefit all the three constituents in the marketing chain: the OEM, the dealer, and the buyer. The carmaker can expand his reach without expensive investment; the dealer can increase his revenue; and the customer gets a variety of models under one roof. The advertisement of Maruti emphasized the availability of service centers across the country with service centers even in remote areas of Ladakh. 34
Fiat – Palio Promotion Strategy Fiat has a fantastic image internationally. The heritage is more than a 100 years old and has a big history and a big brand. Fiat believes that Sachin will help convey this image of Fiat to the people of India. Also, Sachin’s image of dynamism and excellence matches that of the Palio. He is passionate about cars and so FIAT is looking forward to working with Sachin Tendulkar to promote the Palio. The Company used Sachin’s status to great effect when it launched the New Signature series which were signed by Sachin Tendulkar himself and these were a huge success as the people took a great liking for it. Three beauties from Fiat, for the three beauties of India” is how Mr. Bianchi summed up the event. Fiat India, organized a special function at their Kurla plant to felicitate the winners of the Fa Femina Miss India contest, 2002. On the occasion, Mr. M. P. Bianchi, Managing Director, Fiat India Pvt. Ltd presented the three beautiful ladies, Neha Dhupia, Shruti Sharma, and Reshmi Ghosh, with Fiat Palio’s. Over 35 2000 members of the Fiat team gathered together on the lawns in front of the factory to witness the handing over ceremony.
Pricing Strategy The Palio Diesel is offered in three versions – The Palio Diesel EL, Palio Diesel ELX and the top of the line, fully loaded Palio Diesel ELX SP. The new range of diesel cars is competitively priced and continues Fiat’s tradition of offering its customers true value-for-money. The Palio Diesel EL was launched at the price of Rs. 4,19,500. The other variants were priced according to the different features. The diesel cars were launched at the following rates Palio Diesel ELX – Rs. 4,49,500, Palio Diesel ELX SP – Rs. 4,75,000, Adventure Diesel – Rs. 6,99,000 36 37
Tata Engineering and Locomotive Company (TELCO) Promotions The Indica advertising made interest for the car go into overdrive. The campaign revolved around the premise that the Indica would not just meet people’s expectations, it would exceed them. Every advertisement has a story to tell Pre launch Campaign The Indica campaign began in the right earnest in December 1998. It was advertised as the launch of a car that will spell doom for the small cars. It was directly aimed at Maruti 800. The ad line used in the first campaign was “Car makers will suddenly remember all the things they forgot to give you”.
This hinted that Indica would have more features than any of the existing small cars. Indica used the catch lines like “More car per Car” “More dreams per car” to suggest that Indica will be bigger in size to the existing small cars yet be in the small car category. It competes with the mid size cars on size and give them a run for their money with its cheaper price tag. At the launch of the car TELCO claimed that the people would never have to suffer from a small car again and the end of the year (1998) would be the end of the small cars. Launch Campaign 38
The launch campaign of Indica focused on the many advantages that it offered over other cars in the same segment. It promised the customers more than the current offerings. Its first advertisement carried the following catch line “50cc moped, 100cc bike 800cc car. Time you asked for more. ” It then concentrated its efforts on criticizing the negative aspects of Maruti 800 and highlighted how Indica has removed those very defects and presented a very sophisticated and modern car to the Indian customer. It even pointed out that the shape of Maruti was very unconventional and that people would prefer the shape of Indica to Maruti 800.
The advertisement read “Box shaped, bubble shaped, wedge shaped. But then Gentlemen prefer curves” The launch campaign also focused on the roomy interiors of Indica, a feature not offered by Maruti at that point of time. Also the expertise of TATA in diesel engines and fuel efficiency of these were the highlight of the launch campaign of Tata Indica. Post Launch Campaigns 39 While the Launch campaign focused on the features of Indica the post launch advertisements focused on the superior after sales service and longer warranty periods offered by Indica.
Telco was the first company to offer an 18-month warranty period on engine parts. The most famous line used during this campaign was “We could go on and on about service or give you the one word summary. TATA. ” While their main adversary was the Maruti 800, Telco felt that it could also tap the mid size segment using the selling point of space given by Indica. They carried a campaign, which said “Forget small cars, we even make big cars feel small” It then went on to highlight the fact that Indica was Euro II compliant even before it was legally binding upon car manufacturers to do so.
It also highlighted the concrete wall safety test that Indica withstands and tried to showcase the car as a safe and strong car. 40 Conclusion Since idea was to analyze the marketing stratergy of Hyundai Santro so by the intensive study carried out with car owners and marketers of different brand I come at specified conclusions on four P’s of marketing. People Talking about people targeted by Santro is a class who would look for “Value for Money”. It not only comprises of those middle class segment but also of some special class like me and others who are looking for buying their first ever car.
Price Santro has been priced very specifically due to it being on straight competition with all time tough competitor Maruti, as it has a very unique mind set of economical vehicle. Giving Santro at this affordability with higher features marks its presence in this segment really well. Promotion What well it could be if one of the best endorsers in the industry comes himself showing that this what now one would dream of. Shahrukh Khan has a presence which would ask his fan following to trust the brand he trusts.
Product If Santro still requires any introduction then we would say a car which has eaten up a huge share of running cars on the road especially of Maruiti’s 41 monopoly. Then this car has given all what customer would look for cars in this segment. General analysis The demand for the small car will continue to drive growth for the next five years. In the US, auto demand rises by 4 per cent for every 1 per cent increase in the real Gross Domestic Product but this is irrelevant for India as only the top 1. 50 per cent of the population can afford a car.
The demand can shoot up if the income levels of the top 5 per cent continue to rise in future. It is stagnant at 1. 70 cars per 1,000 people for decades. However, in the postliberalization period, the motorization level has leaped to 3. 70 cars per 1,000. Although it is still lower than the levels in the developed markets, motorization is bound to rise further in the coming years. Falling imports and excise duties coupled with competition will continue to boost demand and the prices are likely to fall further at least in the short run. Over 60 per cent of customers opt for consumer finance.
That figure could go up if interest rates continue to fall. Traffic congestion and bad roads could deter potential buyers from going for small cars particularly in small cities of India. The future is not very heartening in this aspect. 42 As manufacturers shift their attention to the small car, more and more people will be able to afford it and demand will only rise in the future period of time. There is a sharp contrast in the buying behavior of Indian Consumer compared to their western counter parts, yet there is no doubt that Indian car market is going to increasingly resemble the latter.
In the West, the industry is likely to be dominated by three or four major players. The market will consolidate to a few segments. The carmaker has to make diverse models based on diverse and flexible platforms. For the price-sensitive customers, there can be a no-frills version; a loaded version for the middle customer and luxury car manufacturers can target the high-end customers. The fortunes of the automobile industry will continue to hinge on the large, price sensitive customers, who will graduate to the higher end of the market over a period of time. 43
Bibliography Marketing Management – Philip Kotler and Keller Marketing Research – Aaker Kumar Dey Websites: Hyundaimotorindia. com Santroxing. com Indianinfoline. com Hindubusinessline. com Autoindia. com Magazine: AutoIndia Business World Overdrive Auto Car 4 P’s of marketing Newspapers: The Economic Times The Financial Express 44 Appendix Questionnaire 1. Which car do you own? Santro Xing WagonR Tata Indica Fiat Palio 2. What is main purpose of having a car? Necessity Convenience Comfort 3. Are you satisfied with the driving convenience and other features of car? Yes/No 4. Do you think Hyundai cars are satisfactory and reasonably priced?
Yes/No 5. Are you satisfied with after sales service of the car company? Yes/No 6. Would you buy Hyundai in future? Yes/No 7. How did you come to know about Xing? Auto Magazine_________________________________________ Newspapers____________________________________________ TV advertisement_______________________________________ Word of Mouth_________________________________________ 45 Please provide your name and address: Title: Mr. /Mrs. /Ms. ____________________ Telephone no. _________________ Name ______________________________________________ Address_____________________________________________ 46