MARUTI SUZUKI LTD

Introduction
Maruti Suzuki is Indias number one leading automobile manufacturer and the market leader in the car segment both in terms of volume of vehicle and revenue earned. Until recently 18.28% of the company was owned by the Indian government and 54.2% by the Suzuki of Japan. The Indian Govt. held an initial public offering of 25% of the company in June 2003. As of 10 May 2007 government of India sold its complete share to Indian financial Institution. With this govt. Of India has no longer stake in Maruti Udyog. Maruti Udyog Limited (MUL) was established in February 1981, though the actual production was started in 1983 with the Maruti 800 based on the Suzuki Alto Kei Car which at that time was the only modern car available in India. Its only competitor was Hindustan Motors Ambassador and the Premier Padmini were both around 25 years out of date at that point.Through 2004 , Maruti Suzuki had produced over 5 Million vehicles. Maruti Suzuki are sold in India and various several other countries depending upon export orders. Models similar to Maruti Suzuki ( but not manufactured by Maruti udyog) are sold by Suzuki Motors corporation and manufactured in Pakistan and other south Asian countries. The company anually exports more than 50,000 cars and has an extremely large domestic market in India selling over 7,30,000 cars anually. Maruti 800 till 2004 was the Indias largest selling compact car ever since it was launched in 1983. More than a Million unit of this car have been sold worldwide so far. Currently Maruti Suzuki Alto tops the sales chart and Maruti Suzuki Swift is the largest selling car in A2 segment.Due to large number of Maruti 800s sold in the Indian market the term Maruti is commonly used to refer to this compact car model. Till recently the term Maruti in popular Indian culture in India, Hindus lord Hanuman is known as Maruti was associated with Maruti 800 model.

Manufacturing Facilities
Its manufacturing facilities are located at two facilities, Gurgoan and Manesar south of Delhi. Maruti Suzukis Gurgoan facility has an installed capacity of 3,50,000 units per annum. The Manesar facility launched in February 2007 comprises a vehicle assembly plant with a capacity of 1,00,000 units per year and a Diesel Engine plant with an annual capacity of 1,00,000 engines and transimission. Manesar and Gurgoan facility have a combined capacity to produce over 7,00,000 units annually.More than a half of the cars sold in India are Maruti Suzuki cars. The company is a subsidiary of Suzuki Motors

Corporation of Japan which owns 54.2 percent of Maruti Suzuki. The rest is owned by the Public and Finance Institution.It was listed on the Bombay ( now Mumbai) stock exchange in India. During 2007-08 Maruti Suzuki sold 7,64,842 cars of which 53,024 are exported in all. Over Six Million Maruti Suzuki cars on Indian roads since the first car was rolled out on 14 December 1983.

Products Offered
Maruti Suzuki offers 15 models and they are, Maruti 800, Alto, Wagon R, Zen Estilo, A Star, Ritz, Swift, Swift Dzire, SX4, Omni, Eeco, Gypsy and Grand Vitara.Out of these models Grand Vitara is imported from Japan a completely built unit (CBU). Swift, Swift Dzire , A Star and SX4 are manufactured in Manesar and the remaining models such as Maruti 800, Alto, Wagon R, Zen Estilo, Ritz, Omni , Eecoetc are manufactured at Gurgoan Plant.

Human Resources
Nearly 75,000 people are employed directly by the Maruti Suzuki and its Partner. It has been rated first in customer satisfaction among all car makers in India from 1999 to 2009 by J.D. Power Asia Pacific.

History
Around 1970, Sanjay Gandhi, Political advisor and younger son to then Prime minister of India, Indira Gandhi , envisioned the manufacture of an indigenous , cost effective , low maintenance compact car for the Indian middle class. Indira Gandhis cabinet passed a uninamous resolution for the devlopment and production of peoples car. Sanjay Gandhis company was christened Maruti Limited. The name of the car was choosen as Maruti, after the name of a hindu deity named Marut. At that time Hindustan Motors Ambassador was the cheif car and the company had came out with a new enterant , the Premium Padmini which was slowly gaining a part of the market share dominated by the Ambassador. For the next ten years the Indian car market had stagnated at a volume of of 30,000 to 40,000 cars for the decade ending 1983. Sanjay Gandhi was awarded the exclusive contract and licence to design, devlop and manufacture the Peoples car.This exclusive right of production generated some criticism in certain quaters, which was directly targeted at Indira Gandhi . Over the next few years the company was sidelined due to the Bangladesh Liberation war and the emergency.

In the early days under the powerful patronage of Sanjay Gandhi, the company was provided with free land , tax breaks , and funds. Till the end of 1970s the company had not started the production and a prototype test model was met with criticism and

skepticism.The company went into liquidation in 1977. The media perceived it to be another area of growing corruption. Unfortunately Maruti started to fly only after the death of Sanjay Gandhi, when Suzuki joined the Govt. Of India as a joint venture parteners with 50% share. After the death of Sanjay Gandhi, Indira Gandhi decided that the project should not be allowed to die. Maruti entered into collaboration with Suzuki Motors . The collaboration heralded a resolution in the Indian car industry by the production of Maruti 800. The car went into sale on December 14,1983. It created record by taking 13 months to go from design to rolling out car from a production line. By the year 1994 the company had sold upto 1,96,820 cars, mostly by selling its cheif product the Maruti 800. By March 1994, it produced one million vehicle , becoming the first Indian company to cross this milestone. It reaches the 2 million mark in October 1997, and rolled out its 4 th million vehicle an ALTO (LX) on April 19, 2003. Maruti Udyog Ltd. is the premium car company in India. Maruti Udyog Limited (MUL) was established in February 1981 through an act of parliament. The Company entered into collaboration with Suzuki Motors of Japan to manufacture cars.The main objectives behind formation of Maruti Udyog Limited was to meet the growing demand of a personal mode of transport caused by the lack of an efficient Public Transport System. Today Maruti Udyog Limited is garneshing share of automobile market in India. It has completely revolutionised the Indian car market and has brought out numerous model to cater to every section of society. These ranges from Economy cars to Luxury cars to Super SUVs.

Companys Profile
Around 1970, Sanjay Gandhi, political advisor and younger son to the then Prime minister of India, Indira Gandhi, envisioned the manufacture of an indigenous, cost effective, low maintenance compact car for the Indian middle class. Indira Gandhis cabinet passed an uninamous resolution for the development and production of Peoples car. Sanjay Gandhis company was christened Maruti Limited. The name of the car was was chosen as Maruti, after a hindu deity named Marut.

Unfortunately Sanjay Gandhi died without fulfilling his dream. After this death , Indira Gandhi decided that the project should not be allowed to die. Maruti entered into collaboration with the Suzuki Motors of Japan. The collaboration heralded a resolution in the Indian car industry by producing Maruti 800. The car went into sale on 14 December 1983. And from 1980s to till day today Marutis have dominated the Indian Automobile industry as well as automobile market.

Stock Exchange on which company is listed

Maruti Suzuki is listed on Bombay stock exchange now Mumbai. It is also listed on NYSE ( New York Stock Exchange) as well as stock exchange of Japan.

Vision, Mission and Core values of Maruti Suzuki Vision

Vision of any company is those values on which company works. As the Maruti Udyog Limited (MUL) is started by governmental initiatives it tends to be more consumer oriented and hence cost- effective, but on the other hand Suzukis participation ensures not only need of profit, but the need of maximum profit. The only way of Noras dil emma of selecting principles for the companys working vision was to maximize profit and sales and hence Maruti Udyog Limited (MUL) declared its vision as:The leader in the Indian Automobile Industry, creating Customer Delight one and shareholders wealth two eventually become pride of India. Customer Delight One is making sure that Performance, after sales service and customer are best and beyond expectations, shareholders wealth two is the prime concern for running business smoothly. Maruti Udyog Limited (MUL) knows this and understands Customer Is King . he can change the future of any company hence goes companys brand line : COUNT ON US!

Mission
Mission is the statement of any organisations purpose , what is want to accomplish in the larger environment and its goal which are specific , realistic, and motivating. Missions are described over Visions and Visions demand certain objectives. The main Objectives / Mission of Maruti Udyog Limited are:1. Modernisation of Indian Automobile Industry. 2. Developing cars faster and selling for less. 3. Production of fuel- efficient vehicles to conserve scarce resources. 4. Production of large number of motor vehicles which are necessary for the Economic Growth.

5. Market penetration, Market developments, similar product development and diversification. 6. Parter relation management, value chain, value delivery networks.

Core Values : Customer Obsession

Fast, Flexible and First Mover Innovation and Creativity Networking and Partnership Openness and Learning

Company Board Of Directors

Mr.Shinzo Nakanishi

Managing Director (M.D) and Chief Executive Officer (C.E.O)

Mr. R.C. Bhargava Mr.Maninder Singh Banga Mr.AmalGanguli Mr.D.S.Brar Mr. Keiichi Asai Mr. Osamu Suzuki Mr.ShujiOishi Ms.PallaviShroff Mr. Kenichi Ayukawa Mr. Tsuneo Ohashi

Chairman Director Director Director Director Director Director Director Director Director and Management Executive Officer

MILESTONES
2005 2004 The fiftieth lakh car rolls out in April, 2005 Growth in overall sales by 15.8% New (non A/C) variant of Alto Alto becomes India's new best-selling car

LPG variant of 'Omni Cargo' Versa 5-seater, a new variant Baleno LXi, a new variant Maruti closed the financial year 2003-04 with an annual sale of 472122 units, the highest ever since the company began operations 20 years ago

2003

New Suzuki Grand Vitara XL-7 Redesigned and all-new Zen New upgraded WagonR Enters into partnership with State Bank of India Production of 4 millionth vehicles. Listed on BSE and NSE after a public issue oversubscribed 10 times

2002

WagonR Pride Esteem Diesel. All other variants upgraded Maruti Insurance. Two new subsidiaries started: Maruti Insurance Distributor Services and Maruti Insurance Brokers Limited

Alto Spin LXi, with electronic power steering Special edition of Maruti 800, Indias first colour-coordinated car Maruti True value in Mumbai Maruti Finance in Mumbai with 10 finance companies Suzuki Motor Corporation (SMC) increases its stake in Maruti to 54.2 percent

2001

Zen LXi Maruti True Value launched in Bangalore and Delhi Maruti Versa, Indias first luxury MPV Alto Spin LXi, with electronic power steering Alto VXi Customer information centers launched in Hyderabad, Bangalore

and Chennai 2000 Launch of versa First car company in India to launch a Call Center New Alto Altura, a luxury estate car IDTR (Institute of Driving Training and Research) launched jointly with the Delhi government to promote safe driving habits 1999 Maruti 800 EX ( 796cc, hatchback car) Zen LX (993cc, hatchback car) Zen VXi (993cc, hatchback car with power steering) Omni XL ( 796cc, MUV, high roof) Baleno (1600cc, 3 Box Car) Wagon R Launch of Maruti - Suzuki innovative traffic beat in Delhi and Chennai as social initiatives 1998 1997 Maruti launches website as part of CRM initiatives Zen D (1527 cc diesel, hatchback car) Zen VX & Zen VX Automatic New (Omni & Omni E) (796cc, MUV) Launch of website as part of CRM initiatives 1998 Esteem (1299cc, 3 box car) LX, VX and AX New Maruti 800 (796cc,hatchback Car) Standard and Deluxe Produced the 2 millionth vehicle since the commencement of production 1996 Gypsy (E) (970cc, 4WD 8 seater) Omni (E) (796cc, MUV, 8 seater) Gypsy King (1298cc, 4WD, off road vehicle)

 1995

Zen Automatic (993cc, hatchback car) Esteem 1.3L (1298 cc, 3 box Car)AX Launch of 24-hour emergency on-road vehicle service Esteem 1.3L (1298 cc, 3 box car)VX With the launch of second plant, installed capacity reached 200,000 units

1994

Esteem1.3L (1298cc, 3 box car)LX Produced the 1 millionth vehicle since the commencement of production

1993

Zen (993cc, hatchback Car), which was later exported in Europe and elsewhere as the Alto

1992 1991

SMC increases its stake in Maruti to 50 percent Reaches cumulative indigenisation of 65 percent for all vehicles produced

1990 1988 1987 1986

Maruti 1000(970cc, 3 box), Indias first contemporary sedan Installed capacity increased to 100,000 units Exported first lot of 500 cars to Hungary Maruti 800 ( New Model-796cc, hatchback Car) Produced 100,000 vehicles (cumulative production) Launch of Maruti Gypsy (970cc, 4WD off-road vehicle) Omni, a 796cc MUV Installed capacity reached 40,000 units Maruti 800, a 796 cc hatchback, Indias first affordable car. Production was started under JVA License and JV agreement signed between Maruti Udyog Ltd. and

1985 1984

1983

1982

SMC of Japan AWARDS 2005 Number one in JD Power SSI for the second consecutive year Number one in JD Power CSI for the sixth time in a row - the only car to win it so many times M800, WagonR and Swift topped their segments in the TNS Total Customer Satisfaction Study Leadership in the JD Power Initial Quality Study - Alto number one in its segment for the 2nd time in a row, Esteem number one in its segment for the 3rd year in a row, Swift number one in the premium compact segment WagonR and Esteem top their segments in the JD Power APEAL study TNS ranks Maruti 4th in the Corporate Reputation Strength (CSR) study (#1 in Auto sector)-Feb 05 Maruti bagged the "Manufacturer of the year" award from AutocarCNBC ( 2nd time in a row)-Feb 05 First Indian car manufacturer to reach 5 million vehicles sales Business World ranks Maruti among top five most respected companies in India-Oct 04 Maruti ranked among top ten (Rank7) greenest companies in India by Business Today - Sep '04

2004 Maruti Suzuki was No. 1 in Customer atisfaction, No. 1 in Sales Satisfaction No.1 in Product Quality (Esteem and Alto) and No. 1 in Product Appeal (Esteem and Wagon R) No. 1 in Total Customer Satisfaction (Maruti 800, Zen and Alto) Business World ranked us among the country's five most respected companies

Business World ranked us the country's most respected automobile company Voted Manufacturer of the year by CNBC Voted one of India's Greenest Companies by Business Today-AC Nielson ORG-MARG

2003 Maruti 800, Maruti Zen and Maruti Esteem make it to the top 10 automotive brands in "Most Trusted Brand survey 2003" J D Power ranked 3 models of Maruti on top: Wagonr, Zen and Esteem Maruti 800 and Wagonr top in NFO Total Customer Satisfaction Study 2003. MUL tops in J D Power CSI (2001) for 4th time in a row

2001 MUL tops in J D Power CSI (2001) for 2nd time in a row: another international first

2000 Maruti bags JD Power CSI - 1st rank; unique achievement by market leader anywhere in the world

1999 MSM launched as model workshop in India; achieves highest CSI rating. Central Board of Excise & Customs awards Maruti with

"SammanPatra", for contribution to exchequer and being an ideal tax assessee

1998 CII's Business Excellence Award

1996 Maruti wins INSSAN award for "Excellence in Suggestion Scheme" Awarded the Star Trading House status by Ministry of Commerce

1994-95 Engineering Exports Promotion Council's award for export performance

1994 Best Canteen award among Haryana Industries as part of employee welfare

1992-93 Engineering Exports Promotion Council's award for export performance.

SWOT ANALYSIS Strengths

Maruti Udyog limited (MUL) is in a leadership position in the market with a market share of 48.74 Major strength of MUL is having largest network of dealers and after sales service centers in the country. Good promotional strategy is adopted by MUL to transfer its thoughts to the people about its products. Maruti Suzuki recorded highest number of domestic sales with 9,66,447 units from 7,65,533 units in the previous fiscal. It recently attained the 10million domestic sales mark. Strong Brand Value and Loyal Customer Base are big strengths for MUL There are around 15 vehicles in Maruti Product portfolio. Has good product lines with good fuel efficiency like Maruti Swift, Diesel, Alto etc Alto still beats the small car segment with highest number of sales MUL is the first automobile company to start second hand vehicle sales through its True-value entity. MUL has good market share and hence its after sales service is a major revenue contributor.

Weaknesses
Low interior quality inside the cars when compared to quality players like Hyundai and other new foreign players like Volkswagen,Nissan etc. Government intervention due to having share in MUL. Younger generations started getting a great affinity towards new foreign brands The management and the companys labor unions are not in good terms. The recent strikes of the employees have slowed down production and in turn affecting sales. Maruti hasnt proved itself in SUV segment like other players.

Opportunities
MUL has launched its LPG version of Wagon R and it was a good move simultaneously MUL can start R&D on electric cars for a much better substitute of the fuel. Marutis cervo 600 has a huge potential in tapping the middle class segment and act as a strong threat to Nano New DZire from Maruti will capture the market share and expected to create the same

magic as Maruti Esteem(currently not available) Export capacity of the company is giving new hopes in American and UK markets Economic growth of the country is constantly increasing and the government is working hard to increase the gdp to double digit.

Threats
MUL recently faced a decline in market share from its 50.09% to 48.09 % in the previous year(2011) Major players like Maruti Suzuki, Hyundai, Tata has lost its market share due to many small players like Volkswagen- polo. Ford has shown a considerable increase in market share due to its Figo. Tata Motors recent launches like Nano 2012, Indigo e-cs are imposing major threats to its respective competitors segment China may give a good competition as they are also planning to enter into Indian car segment Launch of Hyundais H800 may result in the decline of Alto sales.

TYPES OF STRATEGIES
Price Strategy The price of the Maruti car is between Rs. 210000 to Rs. 1500000. Maruti 800 is the lowest price car of this company. Alto, Omni, Wagon R, are also the low price car of the company, Zen & Esteem are the mid price car of the company. But Grand Vitara is the high price model of the company. The price of car is decided according to its product variety, quality, design etc. Place strategy:600 New car sales outlets covering 393 cities. 265 Maruti True Value outlets spread across 166 cities.2628 Maruti Authorized Service Stations, covering 1220 cities. Tie up with Adani group for exporting 200,000 units through Mnudra port Gujarat Suggested Place strategy 400 new car sales outlets in next three years. S150 new true value shops in next three years. 1200 new Maruti Authorized Service Stations in next three years. Tie up with other distributors for Exports. Promotion Strategy-Advertising TV Ads Print Ads Radio Ads Ghar AA Gaya Hindustan India Comes Home in ows . 2,628The number of workshops that provide customers with maintenance support in 1220 cities.

Strategy
Their strategy is to capture the rural market by employing women who belong to their local community through which their product can reach to local consumers. Their strategy is to provide work for women to create awareness among confined consumers.

Process

They started with Project Shakti in which their basic aim is to educate a rural person about their products through women who belongs to their own local community and who can communicate well in their language with them. In this way many educated women get work in rural sector and on the other hand HLL Corporate Social Responsibility (CSR) also increases towards society by introducing educative programs for the benefit of the rural sector.

KEY STRATEGIC INITIATIVES BY MARUTI

A) TURN AROUND STRATEGIES MARUTI FOLLOWED Maruti was the undisputed leader in the automobile utility-car segment sector, controlling about 84% of the market till 1998. With increasing competition from local players like Telco, Hindustan Motors, Mahindra & Mahindra and foreign players like Daewoo, PAL, Toyota, Ford, Mitsubishi, GM, the whole auto industry structure in India has changed in the last seven years and resulted in the declining profits and market share for Maruti. At the same time the Indian government permitted foreign car producers to invest in the automobile sector and hold majority stakes. In the wake of its diminishing profits and loss of market share, Maruti initiated strategic responses to cope with Indias liberalization process and began to redesign itself to face competition in the Indian market. Consultancy firms such as AT Kearney & McKinsey, together with an internationally reputed OD consultant, Dr. Athreya, have been consulted on modes of strategy and organization development during the redesign process. The redesign process saw Maruti complete a Rs. 4000 mn expansion project which increased the total production capacity to over 3,70,000 vehicles per annum. Maruti executed a plan to launch new models for different segments of the market. In its redesign plan, Maruti launches a new model every year, reduce production costs by achieving 85-90% indigenization for new models, revamp marketing by increasing the dealer network from 150 to 300 and focus on bulk institutional sales, bring down number of vendors and introduce competitive bidding. Together with the redesign plan, there has been a shift in business focus of Maruti. When Maruti commanded the largest market share, business focus was to sell what we produce. The earlier focus of the whole organization was "production, production and production" but now the focus has shifted to "marketing and customer focus". This can be observed from the changes in mission statement of the organization: 1984: "Fuel efficient vehicle with latest technology". 1987: "Leader in domestic market and be among global players in the overseas market". 1997: "Creating customer delight and shareholders wealth". Focus on customer care has become a key element for Maruti. Increasing Maruti service stations with the scope of one Maruti service station every 25 km on a highway. To increase its market share, Maruti launched new car models, concentrated on marketing and institutional sales. Institutional sales, which currently

contributes to 78% of Marutis total sales. Cost reduction and increasing operating efficiency were another redesign variable. Cost reduction is being achieved by reaching an indigenization level of 85-90 percent for all the models. This would save foreign currency and also stabilize prices that fluctuate with exchange rates. However, change in the mindset was not as fast as required by the market. Maruti planned to reduce costs, increase productivity, quality and upgrade its technology (Euro I&II, MPFI). In addition, it followed a high volume production of about 400,000 vehicles /year, which entailed a smooth relationship between the workers and the managers. Post1999, the market structure changed drastically. Just before this change, Maruti had wasted two crucial years (1996-1998) due to governmental interventions and negotiation with Suzuki of Japan about the break-up of the share holding pattern of the company. There was a change in leadership, Mr. Sato of Suzuki became the Chairman in June 1998, and the new Mr. J. Khatter was appointed as the new Joint MD. Khatter was a believer in consensus decision making and participative style of management. As a result of the internal turmoil and the changes in the external environment, Maruti faced a depleting market share, reducing profits, and increase in inventory levels, which it had not faced in the last 18 years. After their fall in market share they redesigned their strategies and through their parent company Suzuki they learned a lot. The organizational learning of Maruti was moderately successful; the cost was relatively inexpensive as Maruti had its strong Japanese practices to fall back upon. With the program of organizational redesign, rationalization of cost and enhanced productivity, Maruti bounced back to competition with 50.8% market share and 40% rise in profit for the FY2002-2003.

B) CURRENT STRATEGIES FOLLOWED BY MUL PRICING STRATEGY CATERING TO ALL SEGMENTS Maruti caters to all segments and has a product offering at all price points. It has a car priced at Rs.1, 87,000.00 which is the lowest offer on road. Maruti gets 70% business from repeat buyers who earlier had owned a Maruti car. Their pricing strategy is to provide an option to every customer looking for up gradation in his car. Their sole motive of having so many product offering is to be in the consideration set of every passenger car customer in India. Here is how every price point is covered. Sl.No. BRAND VARIANTS PRICE IN DELHI (Rs.) 1 GRAND VITARA XL7 16,97,000.00 2 MARUTI BALENO LXi 5,72,000.00 VXi 6,42,000.00 3 MARUTI ESTEEM LX 4,66,000.00 VX 5,39,000.00

4 MARUTI VERSA DX 4,19,000.00 DX2 4,58,000.00 5 MARUTI SWIFT LXi 3,95,000.00 VXi 4, 05,000.00 ZXi 4, 85,000.00 6 MARUTI WAGON-R LX 3, 35,000.00 LXi 3, 62,000.00 AX 4,63,000.00 VXi 3,87,000.00 VXi ABS 4,20,000.00 7 MARUTI GYPSY ST 5,06,000.00 HT 5,29,000.00 8 MARUTI ZEN D 3,58,000.00 LX 3,41,000.00 LXi 3,68,000.00 VXi 3,93,000.00 9 MARUTI OMNI CARGO 2,05,000.00 CARGO LPG 1,83,000.00 5 SEATER 2,27,000.00 8 SEATER 2,21,000.00 XL 5 SEATER 2,19,000.00 XL 8 SEATER 2,31,000.00 10 MARUTI ALTO STANDARD 2,38,000.00 LX 2,74,000.00 LXi 2,94,000.00 11 MARUTI 800 STD. MPFI 2,14,000.00 A/C MPFI 2,37,000.00 II. OFFERING ONE STOP SHOP TO CUSTOMERS OR CREATING DIFFERENT REVENUE STREAMS Maruti has successfully developed different revenue streams without making huge investments in the form of MDS, N2N, Maruti Insurance and Maruti Finance. These help them in making the customer experience hassle free and helps building customer satisfaction. Maruti Finance: In a market where more than 80% of cars are financed, Maruti has strategically entered into this and has successfully created a revenue stream for Maruti. This has been found to be a major driver in converting a Maruti car sale in certain cases. Finance is one of the major decision drivers in car purchase. Maruti has tied up with 8 finance companies to form a consortium. This consortium comprises Citicorp Maruti, Maruti Countrywide, ICICI Bank, HDFC Bank, Kotak Mahindra, Sundaram Finance, Bank of Punjab and IndusInd Bank Ltd. ( erstwhile-Ashok Leyland Finance). Maruti Insurance: Insurance being a major concern of car owners. Maruti has brought all car insurance needs under one roof. Maruti has tied up with National Insurance Company, Bajaj Allianz, New India Assurance and Royal Sundaram to bring this service for its customers. From identifying the most suitable car coverage to virtually hassle-free claim assistance it's your dealer who takes care of everything. Maruti Insurance is a hassle-free way for customers to have their cars repaired and claims processed at any Maruti dealer workshop in India. True Value Initiative to capture used car market Another significant development is MUL's entry into the used car market in 2001, allowing customers to bring their vehicle to a 'Maruti True Value' outlet and exchange it for a new car, by paying the difference. They are offered loyalty discounts in return. This helps them retain the customer. With Maruti True Value customer has a trusted name to entrust in a highly unorganized market and where cheating is rampant and the biggest concern in biggest driver of sale is trust. Maruti knows its strength in Indian market and has filled this gap of providing trust in Indian used car market. Maruti has created a system where dealers pick up used cars, recondition them, give them a fresh

warranty, and sell them again. All investments for True Value are made by dealers. Maruti has build up a strong network of 172 showrooms across the nation. The used car market has a huge potential in India. The used car market in developed markets was 2-3 times as large as the new car market. N2N: Car maintenance is a time-consuming process, especially if you own a fleet. Marutis N2N Fleet Management Solutions for companies, takes care of the A-Z of automobile problems. Services include end-to-end backups/solutions across the vehicles life: Leasing, Maintenance, Convenience services and Remarketing. Maruti Driving School (MDS): Maruti has established this with the goal to capture the market where there is inhibition in buying cars due to inability to drive the car. This brings that customer to Maruti showroom and Maruti ends up creating a customer.

III. REPOSITIONING OF MARUTI PRODUCTS Whenever a brand has grown old or its sales start dipping Maruti makes some facelifts in the models. Other changes have been made from time to time based on market responses or consumer feedbacks or the competitor moves. Here are the certain changes observed in different models of Maruti. Omni has been given a major facelift in terms of interiors and exteriors two months back. A new variant called Omni Cargo, which has been positioned as a vehicle for transporting cargo and meant for small traders. It has received a very good response from market. A variant with LPG is receiving a very good response from customers who look for low cost of running. Versa prices have been slashed and right now the lowest variant starts at 3.3 lacs. They decreased the engine power from 1600cc to 1300cc and modified it again considering consumers perception. This was a result of intensive survey done all across the nation regarding the consumer perception of Versa. Esteem has gone through three facelifts. A new look last year has helped boost up the waning sales of Esteem. Baleno was launched in 1999 at 7.2 lacs. In 2002 they slashed prices to 6.4 lacs. In 2003 they launched a lower variant as Baleno LXi at 5.46 lacs. This was to reduce the price and attract customers. Wagon-R was perceived as dull boxy car when it was launched. This made it a big failure on launch. Then further modifications in engine to increase performance and a facelift in the form of sporty looking grills on the roof. Now its of the most successful models in Maruti stable. Zen has been modified four times till date. They had come up with a limited period variant called Zen Classic. That was limited period offer to boost short term sales. Maruti 800 has so far been face lifted two times. Once it came with MPFi technology and other time it came up with changes in front grill, head light, rear lights and with round curves all around. IV. CUSTOMER CENTRIC APPROACH Marutis customer centricity is very much exemplified by the five times consecutive wins at J D Power CSI Awards. Focus on

customer satisfaction is what Maruti lives with. Maruti has successfully shed off the publicsector laid back attitude image and has inculcated the customerfriendly approach in its organization culture. The customer centric attitude is imbibed in its employees. Maruti dealers and employees are answerable to even a single customer complain. There are instances of cancellation of dealerships based on customer feedback. Maruti has taken a number of initiatives to serve customer well. They have even changed their showroom layout so that customer has to walk minimum in the showroom and there are norms for service times and delivery of vehicles. The Dealer Sales Executive, who is the first interaction medium with the Maruti customer when the customer walks in Maruti showroom, is trained on greeting etiquettes. Maruti has proper customer complain handling cell under the CRM department. The Maruti call center is another effort which brings Maruti closer to its customer. Their Market Research department remains on its toes to study the changing consumer behaviour and market needs. Maruti enjoys seventy percent repeat buyers which further bolsters their claim of being customer friendly. Maruti is investing a lot of money and effort in building customer loyalty programmes. V. COMMITTED TO MOTORIZING INDIA Maruti is committed to motorizing India. Maruti is right now working towards making things simple for Indian consumers to upgrade from two-wheelers to the car. Towards this end, Maruti partnerships with State Bank of India and its Associate Banks took organized finance to small towns to enable people to buy Maruti cars. Rs. 2599 scheme was one of the outcomes of this effort. Maruti expects the compact cars, which currently constitute around 80% of the market, to be the engine of growth in the future. Robust economic growth, favourable regulatory framework, affordable finance and improvements in infrastructure favour growth of the passenger vehicles segment. The low penetration levels at 7 per thousand and rising income levels will augur well for the auto industry. Maruti is busy fine-tuning another innovation. While researching they found that rural people had strange notions about a car - which the EMI (equated monthly instalments) would range between Rs 4,000 and Rs 5,000. That, plus another Rs 1,500-2,000 for monthly maintenance, another Rs 1,000 for fuel (would be the cost of using the car). To counter that apprehension, the company is working on a novel idea. Control over the fuel bill is in the consumer's hands. But, maintenance need not be. Says Khattar: "What the company is doing now is saying how much you spend on fuel is in your hands anyway. As far as the maintenance cost is concerned, if you want it that way, we will charge a little extra in the EMI and offer free maintenance." VI. DISINVESTMENT AND IPO OF MARUTI UDYOG LIMITED It was a long and tough journey, but a rewarding one at the end. A reward worth Rs2, 424 crore, making it the

biggest privatization in India till date. The size of Marutis sell- off deal is proof of its success. On the investment of Rs 66 crore it made in 1982, when Maruti Udyog Limited (MUL) was formally set up, the sale represents a staggering return of 35 times The best part of the deal is the Rs 1,000 crore control premium the Government has been able to extract from Suzuki Motor Corporation for relinquishing its hold over Indias largest car company. Now looking at the strategy point of it for Suzuki, of course, complete control of MUL means a lot. Maruti is its most profitable and the largest car company outside Japan. Suzuki will now be in the drivers seat and will not have to mind the whims and fancies of ministers and bureaucrats. Decisions will now become quicker. The response to changing market conditions and technological needs will be faster, says Jagdish Khattar, managing director, MUL. After the disinvestment Suzuki became the decision maker at MUL. They flowed fund in India for the major revamp in MUL. Quoting from the report that appeared in The Economic Times, 4th April 2005, The Indian car giant Maruti Udyog Limited has finalized its two mega investment plans a new car plant and an engine and transmission manufacturing plant. Both the projects will be implemented by two different companies. At its meeting the company's board approved a total investment of Rs3,271.9 crore for these two ventures, which will be located in Haryana. The above signifies when GOI was a major stakeholder in the MUL strategies which lead to investment have had a bureaucracy factor in it but after the disinvestment strategy followed is a TOP DOWN approach with a fast implementation. Suzuki's proposed two-wheeler facility in India, would start making motorcycles and scooters by the end of 2005 through a joint venture, in which Maruti has 51 per cent stake. The two-wheeler unit will have a capacity of 250,000 units a year. The disinvestment followed by IPO gives the insight in the fact that now all the strategic decisions are taken by Maruti Suzuki Corporation. Disinvestment had helped by removing the red tape and bureaucracy factor from its strategic decision making process. VII. REALISATION OF IMPORTANCE OF VEHICLE MAINTENANCE SERVICES MARKET In the old days, the company's operations could be boiled down to a simple threebox flowchart. Components came from the 'vendors' to the 'factory' where they were assembled and then sent out to the 'dealers'. In this scheme, you know where the company's revenues come from. The new scheme is more complicated. It revolves around the total lifetime value of a car. Work on this began in 1999, when a MUL team, wondering about new revenue streams, travelled across the world. Says R.S. Kalsi, general manager (new business), MUL: "While car companies were moving from products to services, trying to capture more of the total lifetime value of a car, MUL was just making and selling cars." If a buyer spends Rs 100 on a car during its entire life, one-third of that is spent on its purchase.

Another third went into fuel. And the final third went into maintenance. Earlier, Maruti was getting only the first one-third of the overall stream. As the Indian market matured, customers began to change cars faster. Says Kalsi: "So the question was, if a car is going to see three users in, say, a life span of 10 years, how can I make sure that it comes back to me each time it changes hands ? So Maruti has changed gears to take a big share of this final one-third spent on maintenance. Maintenance market has a huge market potential. Even after having fifty lakh vehicles on road Maruti is only catering to approximately 20000 vehicles through its service stations every day. For this they are conducting free service workshops to encourage consumers to come to their service stations. Maruti has increased its authorized service stations to 1567 across 1036 cities. Every regional office is having a separate services and maintenance department which look after the growth of this revenue stream. VIII. PLAYING ON COST LEADERSHIP Maruti is the price dictator in Indian automobile industry. Its the low cost provider of car. The lowest car on road is from Maruti stable i.e. Maruti 800. Maruti achieves this through continuous improvements in operational efficiency and productivity. The company has set itself (and its vendors) the target of a 50% improvement in productivity and a 30% reduction in costs in three years. The ability to keep lowering the prices sets Maruti apart from other players in the league. Maruti spread the overheads over a larger base. The impressive sales and profits were the result of major efforts within the company. Maruti also increased focus on vendor management. Maruti consolidated its vendor base. This has provided its vendors with higher volumes and higher efficiencies. Maruti does that by working with vendors, assuring them that for every drop in price, volumes will go up. Maruti is now encouraging its vendors to develop R&D capability for specialized components. Based upon such activities, product competitiveness in the market will further increase. Maruti also made strides in applying IT to manufacturing. A new Vehicle Tracking System improved efficiency on the shop floor and enhanced quality control. The e Nagare system, adopted from Suzuki Motor Corporation, smoothened Marutis Just in Time operations. C) MAJOR FUTURE STRATEGIES I. PHASING OUT ZEN IN 2007 The launch of Swift and phasing out Zen is a strategic move. Alto was launched keeping in mind that it will take over Maruti 800 market in future. Perhaps being the flagship product phasing out of Maruti 800 faced lots of resistance from dealers all over. Another reason behind not phasing out Maruti 800 was the fear of brand shift of customers to other competitors product. Swift was launched in May, 2005 in the price band starting from 4 lacs. Before launch of Swift Maruti management had decided that they will phase out Zen

since it had already came up with two modifications. The major reason behind this decision was cannibalization of WagonR and Swift due to overlapping of price band. It is a rational decision to kill a product before it starts facing the decline stage in product cycle. Maruti is offering Rs. 3000.00 more margins to dealer on the sale of Wagon-R as compared to Zen. This is to let dealer push Wagon R instead of Zen. II. MARUTI PLANS FOR A BIG DIESEL FORAY The new car manufacturing company, called Maruti Suzuki Automobiles India Limited, will be a joint venture between Maruti Udyog and Suzuki Motor Corporation holding a 70 per cent and 30 per cent stake respectively. The Rs1,524.2 crore plant will have a capacity to roll out 1 lakh cars per year with a capacity to scale up to 2.5 lakh units per annum. The new car manufacturing plant will begin commercial production by the end of 2006. Maruti would set up a diesel engine plant at Gurgaon in line with its plan to become a major player in diesel vehicles in a couple of years. This has been done in the wake of major competition from Tata Indica and meets the growing demand of diesel cars in India. While the annual growth in the diesel segment was 13 per cent in the last three years, it was 19-20 per cent in the first quarter (April-June) of the current fiscal. Maruti has currently an insignificant presence in diesel vehicle. It will manufacture new generation CRDI (common rail direct injection) engines in collaboration with Fiat-GM Opel and engines will be of 1200 cc. The plant with a capacity to produce one lakh diesel engines would be operational in 2006. At present, Peugeot of France, supplies diesel engines for Maruti's Zen and mid-sized Esteem models. This will further reduce the imported component in Maruti vehicles, making them more competitive in the Indian market. III. MARUTI PLANS FOR A NEW ENGINE AND TRANSMISSION PLANT The engine and the transmission plant will be owned by Suzuki Power train India Limited in which Suzuki Motor Corporation would hold 51 per cent stake and Maruti Udyog holding the balance. The ultimate total plant capacity would be three lakh diesel engines. However, the initial production would be 1 lakh diesel engines, 20,000 petrol engines and 1.4 lakh transmission assemblies. Investment in this facility will be Rs.1,747.7 crore. The commercial production will start by the end of 2006. IV. INDIA AS EXPORT HUB FOR MARUTI Three years back as an experiment, based on the increasing design capabilities of suppliers in countries like India, McKinsey did an exercise to figure out just how much money could be saved if automobiles were to be made in overseas locations like India, Mexico and South Africa -- an automobile BPO, so to speak. The result was staggering: the industry stands to gain $ 150 billion annually in cost savings, and an additional $ 170 billion annually in new

revenues once demand shoots up following the drop in prices, and the combination of which means a 25 per cent increase in existing revenue levels. According to the study, over 90 per cent of automobiles today are sold in the countries they are made in, so there's a lot of money to be made by shifting the production overseas. Till recently, just 100,000 cars produced in low-cost countries were exported to high-cost ones -- presumably this figure is going up now that Altos from Maruti, Santro from Hyundai, Indicas from Tata Motors, and Ikons from Ford, among others, are being regularly exported out of India. Yet, as McKinsey points out, since it just costs $ 500 and just three weeks (and both figures are falling) to ship out a car to anywhere in the world, why produce cars in highwage islands? If a car was produced in India instead of in Japan, the study says, it will cost 22-23 per cent less, after factoring in higher import duties for components/steel, lower levels of automation, and transport costs. In August, 2003 Maruti crossed a milestone of exporting 300,000 vehicles since its first export in 1986. Europe is the largest destination of Marutis exports and coincidentally after the first commercial shipment of 480 units to Hungary in 1987, the 300,00 mark was crossed by the shipment of 571 units to the same country. The top ten destination of the cumulative exports have been Netherlands, Italy, Germany, Chile, U.K., Hungary, Nepal, Greece, France and Poland in that order. The Alto, which meets the Euro-3 norms, has been very popular in Europe where a landmark 200,000 vehicle were exported till March 2003. Even in the highly developed and competitive markets of Netherlands, UK, Germany, France and Italy Maruti vehicles have made a mark. Though the main market for the Maruti vehicles is Europe, where it is selling over 70% of its exported quantity, it is exporting in over 70 countries. Maruti has entered some unconventional markets like Angola, Benin, Djibouti, Ethiopia, Morocco, Uganda, Chile, Costa Rica and El Salvador. The Middle-East region has also opened up and is showing good potential for growth. Some markets in this region where Maruti is, are Saudi Arabia, Kuwait, Bahrain, Qatar and UAE. The markets outside of Europe that have large quantities, in the current year, are Algeria, Saudi Arabia, Srilanka and Bangladesh. Maruti exported more than 51,000 vehicles in 2003-04 which was 59% higher than last year. In the financial year 2003- 04 Maruti exports contributed to more than 10% of total Maruti sales. V. MARUTI EMERGING AS R&D HUB FOR SUZUKI MOTOR CORPORATION Japanese auto major Suzuki is all set to convert Maruti Udyog Ltds research and development (R&D) facility as its Asia hub by 2007 for the design and development of new compact cars, according to a top official of the firm. The countrys leading car manufacturer will make substantial investments to upgrade its research and development centre at Gurgaon in Haryana for executing design and development projects for Suzuki. This includes

localisation, modernisation and greater use of composite technologies in upcoming models. The company will be hiring more software engineers and technocrats to handle Suzukis R&D projects. Investment would be more in terms of manpower than in infrastructure, which is already in place. Apart from working on innovative features, the R&D teams will focus on latest technologies using CAD-CAM tools to roll out new models that will meet the needs of MULs diverse customers in the future. The reasons as to why it can be good for R&D is that: Firstly the cost involved in R&D and infrastructure is low in India as compared to other countries. Also the technical skills are abundantly available; again at a cheaper cost. Secondly, India is growing as an export hub along with the Indian market growing aggressively into becoming an attractive one for investors. Thirdly, Suzukis investment in India, is also important as it has completely divested now as a result MUL will now become a 100% subsidiary of Suzuki in the coming year. KEY SUCCESS FACTORS (1)The Quality Advantage Maruti Suzuki owners experience fewer problems with their vehicles than any other car manufacturer in India (J.D. Power IQS Study 2004). The Alto was chosen No.1 in the premium compact car segment and the Esteem in the entry level mid - size car segment across 9 parameters. (2)A Buying Experience Like No Other Maruti Suzuki has a sales network of 307 state-of -the-art showrooms across 189 cities, with a workforce of over 6000 trained sales personnel to guide MUL customers in finding the right car. (3)Quality Service Across 1036 Cities In the J.D. Power CSI Study 2004, Maruti Suzuki scored the highest across all 7 parameters: least problems experienced with vehicle serviced, highest service quality, best in-service experience, best service delivery, best service advisor experience, most user-friendly service and best service initiation experience. 92% of Maruti Suzuki owners feel that work gets done right the first time during service. The J.D. Power CSI study 2004 also reveals that 97% of Maruti Suzuki owners would probably recommend the same make of vehicle, while 90% owners would probably repurchase the same make of vehicle. (4)One Stop Shop At Maruti Suzuki, customers will find all car related needs met under one roof. Whether it is easy finance, insurance, fleet management services, exchange- Maruti Suzuki is set to provide a single-window solution for all car related needs.

(5) The Low Cost Maintenance Advantage The acquisition cost is unfortunately not the only cost customers face when buying a car. Although a car may be affordable to buy, it may not necessarily be affordable to maintain, as some of its regularly used spare parts may be priced quite steeply. Not so in the case of a Maruti Suzuki. It is in the economy segment that the affordability of spares is most competitive, and it is here where Maruti Suzuki shines. (6)Lowest Cost of Ownership The highest satisfaction ratings with regard to cost of ownership among all models are all Maruti Suzuki vehicles: Zen, Wagon R, Esteem, Maruti 800, Alto and Omni. (7) Technological Advantage It has introduced the superior 16 * 4 Hypertech engines across the entire Maruti Suzuki range. This new technology harnesses the power of a brainy 16-bit computer to a fuelefficient 4-valve engine to create optimum engine delivery. This means every Maruti Suzuki owner gets the ideal combination of power and performance from his car. COMPETITIVE FORCES IN INDIAN PASSENGER CAR MARKET Critical Issues and Future Trends The critical issue facing the Indian passenger car industry is the attainment of breakeven volumes. This is related to the quantum of investments made by the players in capacity creation and the selling price of the car. The amount of investment in capacities by passenger car manufacturers in turn depends on the production Threat from the new players: Increasing and maintaining adequacy of working capital.

Most of the major global players are present in the Indian market; few more are expected to enter.

Access to distribution network is important. Lower tariffs in post WTO may expose Indian companies to threat of imports.

Rivalry within the industry: High There is keen competition in select segments. (compact and mid size segments). New multinational.

Market strength of suppliers: Low A large number of automotive components suppliers. Automotive players are rationalizing their vendor base to

Market strength of consumers: Increasing

Increased awareness among consumers has increased expectations. Thus the ability to innovate is critical.

ter sales support is critical.

pricing power of

Threat from substitutes: Low to medium

With consumer preferences changing, inter product substitution is taking place (Mini cars are being replaced)

Marketing strategies of the car manufacturers. Setting up integrate manufacturing facilities may require higher capital investments than establishing assembly facilities for semi knocked down kits or complete knocked down kits. In recent years, even though the ratio of sales to capacity (an important indicator of the ability to reach break-even volumes) of the domestic car manufacturers have improved, it is still low for quite a few car manufacturers in India. India is also likely to increasingly serve as the sourcing base for global automotive companies, and automotive exports are likely to gain increasing importance over the medium term. However, the growth rates are likely to vary across segments. Although the Mini segment is expected to sustain volumes, it is likely to continue losing market share; growth in the medium term is expected to be led largely by the Compact and Mid-range segments. Additionally, in terms of engine capacity, the Indian passenger car market is moving towards cars of higher capacity. This apart, competition is likely to intensify in the SUV segment in India following the launch of new models at competitive prices. Maruti Suzuki is one of India's leading automobile manufacturers and the market leader in the car segment, both in terms of volume of vehicles sold and revenue earned. Until recently, 18.28% of the company was owned by the Indian government, and 54.2% by Suzuki of Japan. The Indian government held an initial public offering of 25% of the company in June 2003. As of May 10, 2007, Govt. of India sold its complete share to Indian financial institutions. With this, Govt. of India no longer has stake in Maruti Udyog. Maruti Udyog Limited (MUL) was established in February 1981, though the actual production commenced in 1983 with the Maruti 800, based on the Suzuki Alto kei car which at the time was the only modern car available in India, its' only competitors- the Hindustan Ambassador and Premier Padmini were both around 25 years out of date at that point. Through 2004, Maruti has produced over 5 Million vehicles. Marutis are sold in India and various several other countries, depending upon export orders. Models similar to Marutis (but not manufactured by Maruti

Udyog) are sold by Suzuki and manufactured in Pakistan and other South Asian countries. The company annually exports more than 50,000 cars and has an extremely large domestic market in India selling over 730,000 cars annually. Maruti 800, till 2004, was the India's largest selling compact car ever since it was launched in 1983. More than a million units of this car have been sold worldwide so far. Currently, Maruti Alto tops the sales charts and Maruti Swift is the largest selling in A2 segment. Due to the large number of Maruti 800s sold in the Indian market, the term "Maruti" is commonly used to refer to this compact car model. Till recently the term "Maruti", in popular Indian culture, was associated to the Maruti 800 model. Maruti Suzuki India Limited, a subsidiary of Suzuki Motor Corporation of Japan, has been the leader of the Indian car market for over two decades. Its manufacturing facilities are located at two facilities Gurgaon and Manesar south of New Delhi. Marutis Gurgaon facility has an installed capacity of 350,000 units per annum. The Manesar facilities, launched in February 2007 comprise a vehicle assembly plant with a capacity of 100,000 units per year and a Diesel Engine plant with an annual capacity of 100,000 engines and transmissions. Manesar and Gurgaon facilities have a combined capability to produce over 700,000 units annually. More than half the cars sold in India are Maruti cars. The company is a subsidiary of Suzuki Motor Corporation, Japan, which owns 54.2 per cent of Maruti. The rest is owned by the public and financial institutions. It is listed on the Bombay Stock Exchange and National Stock Exchange in India. During 2007-08, Maruti Suzuki sold 764,842 cars, of which 53,024 were exported. In all, over six million Maruti cars are on Indian roads since the first car was rolled out on December 14, 1983. Maruti Suzuki offers 15 models, Maruti 800, Omni, Esteem, Baleno, Alto, Versa, Ritz, Gypsy, A Star, Wagon R, Zen Estilo, Swift, Swift Dzire, SX4, and Grand Vitara. Swift, Swift dzire, A star and SX4 are maufactured in Manesar, Grand Vitara is imported from Japan as a completely built unit (CBU), remaining all models are manufactured in Maruti Suzuki's Gurgaon Plant. Suzuki Motor Corporation, the parent company, is a global leader in mini and compact cars for three decades. Suzukis technical superiority lies in its ability to pack power and performance into a compact, lightweight engine that is clean and fuel efficient. Maruti is clearly an employer of choice for automotive engineers and young managers from across the country. Nearly 75,000 people are employed directly by Maruti and its partners. The company vouches for customer satisfaction. For its sincere efforts it has been rated (by customers) first in customer satisfaction among

all car makers in India for nine years in a row in annual survey by J D Power Asia Pacific. Maruti Suzuki was born as a government company, with Suzuki as a minor partner to make a people's car for middle class India. Over the years, the product range has widened, ownership has changed hands and the customer has evolved. What remains unchanged, then and now, is Marutis mission to motorise India. Pressure started mounting on Indira and Sanjay Gandhi to share the details of the progress on the Maruti Project. Since country's resources were made available by mother to her son's pet project. A delegation of Indian technocrats was assigned to hunt a collaborator for the project. Initial rounds of discussion were held with the giants of the automobile industry in Japan including Toyota, Nissan and Honda. Suzuki Motor Corporation was at that time a small player in the four wheeler automobile sector and had major share in the two wheeler segment. Suzuki's bid was considered negligible. In the initial rounds of discussion the giants had their bosses present and in the later rounds related to the technical discussions executives of these automobile giants were present. Osamu Suzuki, Chairman and CEO of the company ensured that he was present in all the rounds of discussion. Osamu in an article writes that it subtly massaged their (Indian delegation) egos and also convinced them about the sincerity of Suzuki's bid. In the initial days Suzuki took all steps to ensure the government about its sincerity on the project. Suzuki in return received a lot of help from the government in such matters as import clearances for manufacturing equipment (against the wishes of the Indian machine tool industry then and its own socialistic ideology), land purchase at government prices for setting up the factory Gurgaon and reduced or removal of excise tariffs. This helped Suzuki conscientiously nurse Maruti through its infancy to become one of its flagship Vento. They intend to continue to focus on the small car segment, while offering products in most segments of the Indian passenger car market. They aim to achieve their principal objectives by pursuing the following business strategies: Maintain and enhance their product range: They intend to utilize Suzukis expertise in small car technology to produce new variants of their existing models and to upgrade their products with contemporary technology and features. Increase reach and penetration: They plan to continue to utilize their extensive sales and service network to increase the reach, in terms of geographical spread, and penetration, in terms of sales volumes, of their products across India. Increased availability of automobile finance: They continue to seek opportunities to expand the size of the Indian passenger car market, especially in the small car segment,

through facilitating easy availability of automobile finance. To that end, they have recently entered into an agreement with the State Bank of India. Secure repeat purchases by offering a 360 degree customer experience: On the basis of their belief that securing repeat purchases from an existing customer requires less expenditure than acquiring a new customer, they aim to provide customers with a one-stop shop for automobiles and automobile-related products and services. Continue to benchmark their manufacturing capabilities: They plan to continue to benchmark our manufacturing capabilities with the most efficient car

manufacturing facilities of Suzuki and its subsidiaries. Continue to reduce costs to offer more competitive products: Cost competitiveness has been, and continues to be, central to their strategy as the leading manufacturer in the small car segment to expand the size of the market by offering competitively priced, high quality products. The components of this strategy are: Higher levels of localization Vendor participation in cost reduction Cost reduction on warranties Reduction in initial investment cost Reduction in number of vehicle platforms Achieve further cost reduction through higher productivity Lower cost of ownership: Through their business strategies, they seek to reduce the consumers cost of ownership of their cars, which comprises the cost of purchase, the cost of fuel and

maintenance,including spare parts and repairs, during the life of the vehicle, insurance, and resale value.

NEW INITIATIVES IN MARUTI SUZUKI LIMITED (one stop shop to meet all your needs)

In an effort to become a complete car company, Maruti has entered the car insurance business as well. It offers the customer all the advantages of settling insurance claims directly with any of the companys authorized dealers. This business provides complete fleet solutions to corporate and institutions. Branded Maruti N2N, this service includes the following: customized car policies, economical car leasing, maintenance, servicing, registration, insurance, emergency assistance, accident management and eventual re-sale of cars. MARUTI FINANCE Maruti Finance offers the best finance packages to consumers across the entire Maruti range. The service is being extended across the country in a phased manner. MARUTI GENUINE ACCESSORIES

A single point of contact, Hassle-free transactions, Emergency Assistance ,Virtually Cashless Repairs Post accident repairs and insurance support at any dealer workshop. MARUTI TRUE VALUE Maruti has taken its first steps in the pre-owned car business under the brand name of Maruti True Value. Using their technological expertise, network support and the experience they have gained in the last 18 years, the company ensures the customers gets great value and completes the transaction zero hassles.

EXTENDED WARRANTY

4 years or 80,000 kms Can bought anytime during primary warranty, best at time of purchase. ANYTIME MARUTI Maruti Suzuki has also set up state-of-the-art call centers (operational in Delhi, Gurgaon, Mumbai, Chennai, Bangalore and Hyderabad) Branded Anytime Maruti, this 24 hour help-line clarifies all doubts and queries regarding Suzuki any time of the day or night.

LIMITATIONS a. Due to time and money constraint, study was restricted to web only. b. Data collection method was secondary and web based only. c. Company dont want to disclose their core strategies d. Secondary data is not sufficient to find out the overall plan and marketing strategies of any of the company

DIVERSIFICATION
Car market leader Maruti Suzuki India Limited unveiled two global models Concept CIAZ and SX4 S-CROSS on the inaugural day of the Auto Expo 2014 here today. The Company expressed its preparedness for the future with two distinct offerings positioned for different segments and will help Maruti Suzuki gain foothold in new segments. The vintage red coloured Concept CIAZ (pronounced as: chi-aaz) and the imposing rugged black coloured SX4 S-CROSS were jointly unveiled by Mr. Toshihiro Suzuki, Executive Vice President, Suzuki Motor Corporation, Japan and Mr. Kenichi Ayukawa, Managing Director and CEO, Marui Suzuki India Limited.The stunning models positioned on the center stage give a glimpse of Maruti Suzukis plans to foray in new and distinct segments to retain its leadership position in the Indian market. Unveiling the two `future ready global offerings Mr. Toshihiro Suzuki, Executive Vice President, Suzuki Motor Corporation said, "The two

cars that we unveil today follow the footsteps of the iconic Suzuki Swift. These models are designed to meet the varied requirements of discerning customers around the world. While the SX4 S-CROSS is a real crossover with authentic performance, the Concept CIAZ is designed to meet the growing demand in C-Segment market in India, China and elsewhere. "On the occasion Mr. Kenichi Ayukawa, Managing Director and CEO, Maruti Suzuki India Limited said, "Concept CIAZ and SX4 S-CROSS are two premium segment global offerings. This rich line up will strengthen our product portfolio and prepare us for the future. "Reinforcing Maruti Suzukis strong customer connect he added, "The vehicles that you see here today reflect our thought and belief. If you like them, they may be amongst you on the Indian roads, in future. As a customer, your right judgment has guided us over the past 3 decades. We promise to bring exciting and relevant products, as you need them."

Concept CIAZ On display at the center of the Maruti Suzuki pavilion rests the shining Concept CIAZ. Concept CIAZ is a classy urbane A3-segment sedan especially designed by Suzuki Motor Corporation for leading markets such as India and China. Concept CIAZ is a fusion of sportiness and elegance and is expected to strengthen companys portfolio in upper A3 segment. Through a dynamic body shape with edgy character lines, Concept CIAZ projects a truly authentic sedan style. (Detailed product note shared separately)

Global SX4 S-CROSS Global model SX4 S-CROSS brings forward Suzukis capability to offer best of the two segments together and create a new segment for its discerning customers across global markets. The imposing SX4 S-CROSS showcased as a reference vehicle, reflects Maruti Suzukis openness to diversify in new segments and strengthen the product portfolio. The highly positive customer response to the Ertiga gives confidence to the Company to reinforce its presence in the segment. (Detailed product note shared separately).

Celebration all the way Carrying forward the legacy of celebrating happiness, the theme for this years auto expo is Celebrate which pairs spontaneity and spirit of unity in India.

The Maruti Suzuki pavilion displays 13 thematically customised cars created exclusively for the Auto Expo celebrations. While the new Concept and Global model showcase the global product portfolio, these tailored cars bring forward the immense innovative

opportunities for the Maruti Suzuki customer. Bringing these designer cars to Auto Expo is also Maruti Suzukis way to Celebrate its long standing association with the Indian customers. In sync with the Celebrate theme, Maruti Suzuki will also engage its patrons in on-thespot fun activities at the pavilion, offering lively engagement and entertainment all through the megashow. (Detailed note on Celebrate theme shared separately)

As a forerunner to the Auto Expo, Maruti Suzuki launched its dedicated microsite for the event along with a mobile application for the auto enthusiasts. Maruti Suzuki will also release its car anthem for India during the Auto Expo.

MERGERS, TAKEOVERS AND AMALGAMATIONS

CORPORATE GOVERNANCE Meaning Corporate governance is to develop a strategic plan for operations. This includes systems and procedures designed to structure authority, balance responsibility and provide accountability to stakeholders at all levels. In essence, corporate governance is about balancing profitability with sustainability. External Stakeholders Recognizing your external stakeholders is an important part of corporate governance. External stakeholders include customers, suppliers, vendors and the community -- all of those people who fall outside the internal workings of your business. Strategically managing your relationships with external stakeholders is essential because these people place high value on a business' ability to offer high quality and fairly priced products and services. The old adage to "keep your customers happy and they'll keep coming back" is a wise approach to managing stakeholder expectations. Internal Stakeholders On the flip side, a business' corporate governance structure must also incorporate a focus on its internal stakeholders. These are the individuals within the business that have a direct impact on its daily operations, such as employees, the Board of Directors and the management. Building strategic relationships with these people is important for ensuring the long-term success of the business including its profitability. The key is to keep your internal stakeholders informed and motivated; they should want the business to be the best it can be and they should always have the external stakeholders' interests in mind.

Importance of Corporate Governance

1. Changing Ownership Structure: In recent years, the ownership structure of companies has changed a lot. Public financial institutions, mutual funds, etc. are the single largest shareholder in most of the large companies. So, they have effective control on the management of the companies. They force the management to use corporate governance.

That is, they put pressure on the management to become more efficient, transparent, accountable, etc. The also ask the management to make consumer-friendly policies, to protect all social groups and to protect the environment. So, the changing ownership structure has resulted in corporate governance. 2. Importance of Social Responsibility: Today, social responsibility is given a lot of importance. The Board of Directors has to protect the rights of the customers, employees, shareholders, suppliers, local communities, etc. This is possible only if they use corporate governance. 3. Growing Number of Scams: In recent years, many scams, frauds and corrupt practices have taken place. Misuse and misappropriation of public money are happening every day in India and worldwide. It is happening in the stock market, banks, financial institutions, companies and government offices. In order to avoid these scams and financial irregularities, many companies have started corporate governance. 4. Indifference on the part of Shareholders: In general, shareholders are inactive in the management of their companies. They only attend the Annual general meeting. Postal ballot is still absent in India. Proxies are not allowed to speak in the meetings. Shareholders associations are not strong. Therefore, directors misuse their power for their own benefits. So, there is a need for corporate governance to protect all the stakeholders of the company. 5. Globalization: Today most big companies are selling their goods in the global market. So, they have to attract foreign investor and foreign customers. They also have to follow foreign rules and regulations. All this requires corporate governance. Without Corporate governance, it is impossible to enter, survive and succeed the global market. 6. Takeovers and Mergers: Today, there are many takeovers and mergers in the business world. Corporate governance is required to protect the interest of all the parties during takeovers and mergers. 6. SEBI: SEBI has made corporate governance compulsory for certain companies. This is done to protect the interest of the investors and other stakeholders.

Corporate Responsibility Strategy Development For Maruti Suzuki

The report is on Corporate Responsibility practice currently in Maruti Suzuki India Limited, review of their performance and recommending a strategy which delivers positive value with a sustainable competitive advantage. Maruti Suzuki India Limited is major concerns are the labour issues caused by the contract, young and restless and the environmental impact. With the awareness of environmental aspect, customers are shifting towards eco-friendly products and valuing product which are doing so. Regulation and global competition on becoming more environmental friendly organisation is pushing companies to do more on reducing consumption and waste. The corporate responsibility issues in value chain across the three category Environmental, Social and Economic is analyzed and is tabulated with the prioritized impacts. Then the current performance highlights of the MSIL in the Environmental, Social and Economic from their annual Corporate Responsibility Report. The short comes and areas of improvement are discussed. With the issues and the present performance of corporate responsibility, a better responsible vision is created. A corporate responsibility strategy is developed to gain value. N2N Fleet Management While working to enhance shareholder wealth, Maruti Suzuki will regularly engage with all stakeholders to assess their needs and through its products, services, conduct and management initiatives, promote their sustained growth and well-being (Maruti Suzuki, 2012). There has been issues in the management do to the joint venture agreement between Suzuki and Government of India , until recently Government of India has sold its complete share to Indian financial institution. Due to the management changes and pose of job loses dude to the change there has been lot of unresolved issue with the work force. Since its first operations in 1983 there has been strikes , go slow protest by the labours. There have been many occurrence in the years 1984,1997,2000,2001,2002,2011 and 2012. The recent incident at Manaser shock the whole industry, leaving one dead and 100 injured when more than 500 workers broke the office and set it on fire. The reason of this from the labour side is that the contract works get only half the salary of the permanent employees also claim harsh working conditions. Discriminatory comments to a low-caste worker by the supervisors. The management disagreed to the cast discrimination. Corporate responsibility issues across value chain Clean, lean and safe cars are not only societally desirable but they also have the potential to create a competitive advantage for the industry, insofar as they meet these consumer expectations, are affordable and address needs which are applicable to, and have to be addressed by, the global community as a whole (European Commission, 2006). Environment Issues Environment issue is mainly in the Manufacturing of vehicles, inbound component and part manufacturing and Logistics. Electricity is consumed in both inbound and operations and their back up power supply is powered by fossil fuel both leading to Greenhouse gas. There are waste such as Hazardous waste from the production, shredded metals and residue from raw materials, Oil and lubrication from operation and service, package materials and water waste. Logistics is a major operation as the manufactured vehicles has to be delivered across the

country and also to the harbour for exporting. With the just in time model the is an increases in the inbound logistic (India transport portal, 2010). The Fossil fuel is used for combustion and this leads to Greenhouse gas potential increasing the carbon foot print. Figure shows the important environment issues across the value chain. Figure Environmental issues across the value chain

CONCLUSION The price of a car is just one-third of what it cost you over its lifetime. Running and maintaining it make up the other two-thirds. Take into account resale value and its real cost becomes clear. Maruti Suzuki stands for value as much as it stands for performance. In spite of rising input costs, we try our best to keep prices down. Their running costs and resale values are unbeatable too. Nothing matches the delight their cars deliver. In the JD Power CSI study 2005, 85% of Maruti Suzuki owners stated that they would definitely recommend the car they drive to someone else. In fact, you dont buy a Maruti Suzuki. You invest in it. After the rash of new cars launches the past two years, the relative lull in the auto industry is showing up in the customer satisfaction indices. According to the 2005 four-wheeler Total Customer Satisfaction (TCS) study conducted by the specialist division of TNS Automotive, the automobile ownership experience or customer ownership experience has declined in all areas

compared to 2004. The study is one of the largest syndicated automotive studies in India, representing the responses of more than 7,000 new car buyers. The comprehensive study covers over 50 models with customer evaluations taken in the key areas of sales satisfaction, product quality, vehicle performance and design, after-sales service, brand image, and costof ownership. The TCS index score provides a measure of satisfaction and loyalty a given model enjoys with its customers. According to TNS Automotive, the decline is predominantly for older, small and entry mid-size car models. The ageing of these models seems to be posing a stiffer challenge for manufacturers to sustain past performance levels at a time when customer expectations are rising sharply.