Hero Moto Corp Ltd.

Issue

Cause

2010
Hero and
Hero - Honda
Honda
decides to
started
move out of seeing each
Joint Venture
other as
competitors

Effect
New brand
identity &
logo- Hero
Moto Corp

Theory

Solution

Competitio
n
Market
Hero Moto
Bajaj Auto,
Leader
Corp should Honda, TVS
defensive
spend on
Motors,
strategiesR&D for
Mahindra
innovation,
Scooters,
- Position
develop new LML, Kinetic
defence
technology
Motors,
- Counter
and
Suzuki, Royal
offensive
upgradation
Enfield,
defence
Yamaha
- Contraction
defence

Honda didn't Hero group

have
might have
intention of to pay higher
sharing the royalties for
upgraded the upgraded
technology
technology
Refusal to
Hero Moto Corp Ltd.
merge the

Hero Moto
Corp buys
stake in
Honda

Market Size
(Sales unit 2012)
15.4 Million (Approx.)

Motor cycles
10 Million

Scooters
2.7 Million

Moped
0.78 Million

Hero
MotoCorp
6.23
Million

Motor cycles
58% market share
5.79 Million
Source:

Hero Moto Corp Ltd.

Scooters
15.2% market share
0.41 Million
3

Revenue Stream
Years

2007-08

2008-09

2009-10

2010-11

2011-12

Sales (units)

33,37,142

37,22,000

46,00,130

51,02,444

62,35,205

24%

25%

20%
17%
16%
15%

15%

14%
13%
12%
10%

11%
10%

11%
10%

10%

Sales growth (nos.) %

OPM
NPM

5%

0%
2008-09

2009-10

2010-11

2011-12

Hero Moto Corp Ltd.

Threat of New Entrants

Low
Bargaining
Power of
Suppliers

High Bargaining
Power of
customers
Suzuki; 3% Others; 2%
Hero MotoCorp; 44%
Yamaha; 3%
Honda;
15%19%
Bajaj;
TVS; 14%

Munjal Showa
AG Industries
Satyam Auto components
Sunbeam Auto
Rockman Industries

Extensive competition
2012 Domestic Sales 15.4 Million
Threat of substitutes

Hero Moto Corp Ltd.

Rs. 79

Rs. 45
Government
Policies
High import duty
on motorbikes

105%

76%

R & D facilities
in U.S. Erik
Buell Racing
$ 20 Millions

Core Competency
Exports
0.17 Mn two-wheelers
Share Price
10 % since 2011 Tie-up with AVL for
1713-1905
engine development
Hero Moto Corp Ltd.

Political
Land acquisition
Imposition of taxes

Technological

Economical

Technical collaboration with

Changing lifestyles & high
Steyr Diamler Puch
quality
Largest investment of over Rs.
Deluxe segment (category)
2500 Cr.
100-125cc grew up by 15%
to build an integrated R&D
125-250cc category grew at
centre in
9%
Rajasthan
4% excise cut & 1% reduction
Technical & Financial collaboration Social
in CST
with
Higher interest rate & fuel
- Green Technology
Showa Corporation Japan
- Safe Manufacturing prices
- Rain Water Harvesting
- The Green Supply Chain
- Vocational Training Camp
- Safe Rider Program

PEST

Hero Moto Corp Ltd.

HMC Sports Bike

HMC Racing
Events

C
M
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e
t
a
e
r
C
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c
n
e
i
r
e
p
x
E

HMC Roadies

Hero Moto Corp Ltd.

HMC Merchandise

Thank You

Hero Moto Corp Ltd.