NAME: PARITA DAIYA

GROUP: N

COLLEGE REGISTRATION NUMBER: ETOLA 17320

WORDCOUNT: 5,816
 -:ACKNOWLEDGEMENT:-

I owe my deepest gratitude to my Lecturer, Mr. Rai Hassan Mahmood whose

support, guidance and encouragement from the preliminary level to concluding level
made me able to develop an understanding of the subject.

I am also thankful to my friends who shared their ideas with me regarding the
subject and provide me valuable guidance as and when required. I am grateful to all
who have directly or indirectly contributed in the project and provided their support
and encouragement to present this project.
With regards,
Parita Daiya
 ABSTRACT
Honda is the second largest automobile company at a global level. It
believes that the issue of the change in global climate is not possible to solve by acting at
regional level. A world wide strategy which is achievable, targeted and cohesive is required.
So it is addressing the problem on a global scale and working to develop an environmentally
friendly car which is expected to launch by 2012. The aim for launching this car is to satisfy
the constant demand of the consumers of South East Asia particularly Indonesia, Malaysia,
Phillipines and Thailand.
This research project represents the objectives, need to launch the new
Green Car, its features, market structure analysis, micro and macro study of environment,
stages of new product development, resources required and monitoring after launching the
new product to gain the competitive advantage in new market. The data collected from
secondary sources to prepare this report.
INTRODUCTION:-

Honda-The Power of Dreams is the Japanese company established by Soichiro Honda

in 1948. It has established its reputation in automobile industry by producing various types of
cars and motorcycles. Honda is the 2nd in car maker and 5th largest in the world.

Honda has first introduced T360 in 60 decades of 20th century and then launched
number of cars like Civic Hatchback, Delsol, Insight, Civic Si, Accord, S2000, CRX, Civic,
Prelude etc. The company continuously strives to build brand loyalty through its vision of
combining innovative technology in terms of design and performance.

At present, the company is planning to launch an “ECO-CAR” by 2012 in South-

Asian countries such as Indonesia, Malaysia, Thailand and Philippines. This green car will
appeal to environmentally conscious people who want practical, low-polluting transportation.
TASK 1(a)

Need for developing a New Product:

Global warming is the current issue for every country and for the ordinary people as well.
Introducing green car instead of the normal cars, might be a solution of this problem.
Moreover, Honda believes that the easiest way of getting into someone’s mind is to be first. It
helps the company to achieve the unique position in the mind of customers. So by launching
this car, Honda wants to help the planet to stay green.

Objectives:-
 To capture 20% long-run share of the total auto market.
 To earn return on investment at 15% after tax.
 To establish different features and appeal to different buying motives.
 To become global leader.
 To attract new customers and retain existing ones.
 To increase brand awareness and recognition.

Features of the new product:-

Cars have become the essentials of everyday life however they are the major polluters and
cause damage to the environment. So Honda decided to launch Green Car (UNIQUE) which
is less damaging compared to conventional cars. This car will meet the demands of the
environmentally aware people of South-Asia without neglecting the pleasure of driving and
sacrificing the needs of the planet.

The engine capacity will be 799, CO2 omission will be 88g/km, Hybrid 4 Technology having
combination of diesel and electric power, MPG will be 85.6. Another features are:

5 speed manual transmission and automated clutch

 Final drive
 Electric machine
 Battery pack
 CIDI internal combustion engine
 Integrated power electronics

The technology behind this HYBRID car is designed to run with alternative fuels as if one
looks under the bonnet, there will be two engines one will use electricity while the other will
use diesel. The idea behind this is if the fuel gets finished, the electric engine will ensure the
consumer/driver to reach at home. Both engines will work on tandem as one will give better
performance while the other will higher mileage with cheaper cost.
(www.alternative-car-fuels.co.uk accessed at 20:08 on 28/10/2010)

With its launch, Honda will write a new chapter in the motor history.

(b)

Market Structure Analysis:-

Market structure analysis is the process of analyzing the makeup of the particular market. It
focuses on different features of the market including the size, number of providers and their
market share, purchasing power of the consumers etc. It is also the analysis of pricing
structures, technological impacts, domestic and overseas sales etc.

At the time of launching this car (Unique-Green car), it is required to find out where the
power lies in business situation, the strength of present competitive position, the strength of a
position one is looking to move into, take a fair benefit of a situation and improve the
weakness to avoid taking wrong steps and to find out whether this new car has potential to be
profitable in South-East Asian market. For doing this, I would like to use Michael Porter’s
Five Forces model as:
(www.12manage.com accessed at 11:11 on 29/10/2010)

1. BARGAINING POWER OF SUPPLIERS:-

Suppliers in automobile industry influence at low rate. There are many suppliers for
supplying the raw materials like steel, aluminium, dashboards, seats, tyres etc and
many parts are used to manufacture a car. So if there are many suppliers in an
industry, their influence remains low as the manufacturers can switch over to others
very easily if necessary.

2. THREAT OF NEW ENTRANTS:-

The threat of new entry is low as Honda has already established its position in the
automobile industry at global level. Moreover, this industry is capital and labour
intensive which requires lots of capital investment at the beginning stage for
manufacturing, research and development, etc. In addition, if anyone wants to enter, it
has to access to distribution channels, find a dealer to sell the car or the company
should have its dealership which requires lots of space for maintaining a wide variety
of inventory.

3. BARGAINING POWER OF BUYERS:

This force has a high influence as the buyers are a significant portion of revenue of
automobile industry. If the company cannot satisfy them, they have power to switch
on to competitors’ products. In case of South East Asian Market, one out of seven
buys the car.

4. THREAT OF SUBSITITUTES:
The car hasn’t many substitutes. Generally, people go by bus, bicycle, taxi or train for
travelling one place to another. Moreover, a car is a luxury item so substitutes affect
less.

5. RIVALRY AMONG COMPETITORS:

Competition among the existing firms is very strong for Honda. Companies like
Toyota, Mitsubishi, Suzuki, Nissan, Hino and Mazda give tough competition to
launch this car as Toyota has also introduced New Prius City car. So Honda has to
outperform while launching this car.

General Market Analysis with PESTELE:

POLITICAL FACTORS:

Political factors are related with the rules and regulations of government, tax policy, trend of
employment, changes in government etc. In case of South East Asia Market, the government
is very favourable for this car as it saves the planet and beneficial to mankind. So it is very
positive and offering various incentives like 17% excise tax, 8 years exemptions on corporate
Income tax and machinery import duties, reduction upto 90% on import of raw materials and
parts etc. ( www.bangkokpost.com accessed at 16:45 on 29/10/2010)
Moreover the government of these four countries play a key role in encouraging the R&D
due to high risks and considerable investment commitments. There is always the problem of
the free rider and the absence of market discipline may create the incentives for rent-seeking.

ECONOMIC FACTORS:

Economic factors like economic growth, inflation rate, interest rate, labour cost,
unemployment, impact of globalization etc affect the company. In case of this market,
economic growth rate is 6.4% this year compare to previous which was 4.9% which shows
that recession has not affected to the automobile industry of these countries So this is also
favourable sign for launching this car. Moreover, credit is also available easily with low
interest rate. Government of Indonesia is going to spend one-fifth of the Government budget
on subsidy for fuel.

(www.seekingalpha.com accessed at 8:12 on 01/11/2010)

SOCIAL FACTORS:

Change is life style is also an influencing factor. Increase in standard of living will increase
the sales of the car. Nowadays women have come out from home to work and their lifestyle
has changed. Due to this, income level and purchasing power have increased and this will
affect to sales of the car in South East Asian market.

TECHNOLOGICAL FACTORS:

Technology is conventionally defined as "a collection of physical processes that transform

inputs into outputs and knowledge and skills that structure the activities involved in carrying
out these transformations" (Kim 1997, p. 4).

Technological advancement can change the demand of the product, reduce the cost to
undercut competitors etc. Maintaining awareness of new technologies decreases the
possibilities of becoming obsolete and promotes innovation. In case of Honda, it is already
using the latest technology. An innovation of this type of car is also one of the result of its
vision towards the use of latest technology. Moreover, the economies of Thailand, Indonesia,
Malaysia and Philippines have changed almost beyond recognition since 1950s. The time is
ripe to turn to ways in which access has been gained to modern technologies. So, it can be
said that the technological progress is also one of the most affecting factor for any company
while launching the products in the market.

ENVIRONMENTAL FACTORS:

Global warming is the burning issue for the whole world. Government is also serious about
this issue and assisting various types to industries through exemptions and tax relief to
produce environmentally friendly product. So while launching this type of car is an initiation
to save the planet. Moreover, the system of recycling of the waste, no pollution is generated
etc are the environmental factors which will affect the process of launching a new car.
LEGAL FACTORS:

Legal factors like ASEAN free trade agreement provides exemption and high protection
against import of readymade vehicles are also influencing factors while launching a new in
South East Asian market. Moreover, there are certain rules and regulations for the Honda to
maintain quality of the product.

ETHICAL FACTORS:

Honda is already performing its social responsibilities and considering the ethical issues
through launching this environmentally friendly car at a reasonable rate to the people of these
countries. Moreover, it will provide employment by following the various laws such as Sex
Discrimination Act, Equal Pay Act, Minimum Wages Act, Health & Safety Act, Provident
Fund Act, etc while implementing the project. It will provide good working conditions to its
employees. Honda will provide all accounting information without misleading, no price
skimming, privacy of employee and employer will be maintained. Quality will be checked
regularly by internal as well as external parties regularly and company will try to maintain its
standard, and there will not be any infringement in patent and copyright.

Task 1(c)

Project life cycle describes the tasks that must be completed to produce a product and it is
different for different product and project.

(www.spottydog.u-net.com accessed at 13:04 on 31/10/2010)

This stage of project can be applied to new a new product as:

1) Idea Generation:

This is the first step to launch a product. Through brainstorming, it can be finalised that the
urgent demand of the current situation is to save the planet. So the Research and
Development team decided to launch an environmentally friendly car at the end of 2012.
(www.google.co.uk accessed at 23:07 on 30/10/2010)

1) Product Screening:
From the analysis of the South-East Asian market, it is found that the launching of
green car is a profitable project as GLOBAL WARMING is the burning issue for all
over the world. The Government of every country is also worrying about this situation
and encouraging the industries by providing incentives, relief in tax and excise etc too
manufacture such type of car. Moreover, Honda has a direct competition with
Toyota, Nissan, Ford etc but to launch this car is new and demanding idea of present
situation.

2) Concept Testing:
In this stage, the attitudes and intentions of consumers are tested by conducting a
survey. On the basis of their feedback, their suggestions will be considered in relation
with improvement in product features, etc.

3) Business Analysis:
Business analysis is quite broad and detailed analysis for testing the product concepts.
In this stage, the company can use demand projection to analyze the price/sales
relationship, speed of sales growth, rate of repurchases etc. , cost projection to find
out the cost of raw material, total cost per unit, economies of scale, break-even point
etc., strength and weaknesses of competitors, their strategies in response to new
product, required investment, profitability etc.

4) Product development:
This stage converts the idea into action. The product will take its physical form in this
stage. It involves product construction, packaging, branding, product positioning,
attitude and usage testing.
 (www.technologystudent.com accessed at 12:44 on 31/10/2010)

5) Test marketing:
The actual idea of consumer behaviour towards the new product is tested at this stage.
The company can come to know how the product performs in different countries like
Indonesia, Malaysia, Philippines and Thailand.

6) Commercialization:
At this stage, the company will implement its total marketing plan and full production. It
will be the introductory stage of the product life cycle. The speed of acceptance by
consumers and channel members, production capabilities, price, competition etc will be
considered at this stage.
The above steps of project development can be expressed in gantt chart as under:-

GANTT CHART:

D
Action plan:

From the figure drawn above for the Development of a New Product, it is clearly understood
that at the beginning itself, the company will have to do a quick market survey whether the
product which is going to be launched will suit the market conditions or not, so for the same
reason, it is required to find out the scope of the product by getting the feedback from the
market. Once the feedback is received, a suitable design of the product will be selected to
enhance the product to penetrate into the market initially and perform better in relation with
the prevailing marketing conditions. After this step, the product is launched to test into the
market by using various marketing tools and techniques to confirm whether there is any
defect in the product, if yes, then it can be reassured and corrected and the product can be
launched successfully to the target market which eventually help the company to gain its
return on the investment so made.

For the success of the new product, a proper and a convincing method should be followed as
per the changing trends in the market. There should be a timely monitoring and updating
process made for the same. Ideally three stages of inspections should be followed for the
newly developed product, which is as follows:

1. Initial Inspection

2. Work-in-Progress Check and

3. Final Inspection.

This means that the raw materials used, will be checked and inspected thoroughly for their
quality and durability, secondly when these materials will be in progress or use their
monitoring will be made in the process itself and finally in the end when the product is ready
to be launched at the hands of the end users. These checks so made will make sure and
reassure the end users who will have the privilege to use as it will pass through all the
standard checks and chances of complaints will also be less. Thus, as per the needs of the
customers and the changing marketing conditions the product will be updated to sustain the
competition for a long time.

Product Life Cycle:

(Management Research –Project and Presentation, Page 1.22)

Introductory Stage:

This is the stage when the product is introduced in the market. People here are unaware about
the product and its benefits, so naturally the sales will be low. The primary motive in this
stage should be to make the people aware about the product through marketing and
advertising. These promotional costs are generally high as to make the people aware about
the new product which again adds to the low sale made increasing the costs incurred during
this stage. Thus higher expenses incurred and low sales consolidate this stage with negative
profits.

Growth Stage:

At this stage the revenue and the sales will increase as more number of people are aware
about the product. The company will start making profits and will increase its market share.
The promotional costs made at the introductory stage will go down, on the other hand the
sales is increasing resulting into profits. The number of distributors increases and the
marketing team may also expand, and the convincing part of the customers also reduces.
Thus it can also be called as a booming stage.

Maturity Stage:

Maximum sales and profit is earned in this stage, because at this stage the company has made
a niche in the market and earned a reputation as a brand, so the promotional expenses are nil.
Moreover, now the company competes with other new competitors at prices. Sales are
consistent as the product is now completely known to all in the market, so maximum profits
can be expected at this stage.

Decline Stage:

In this stage the product will experience decline in sales and profit as there will be many
other alternatives coming in the market. Only if the product has developed loyalty with its
existing customers who promise to continue with it will help the product to sustain. But
gradually even this will fade away, the decline stage is that stage where the existing product
needs to go through a research and development process or may be diversify the existing.
Anyhow, in this stage the technology needs to updated as it becomes obsolete as compared to
the ongoing technologies present at that time. Thus in the decline stage the product suffers a
great loss and may even have to diversify the existing one or may be modified according to
the demands of the market conditions.

Task 2(a)

Research methods:

There are many methods of research while launching a new product in the market like survey,
focus group, interview, observation, inductive, deductive, historical, descriptive study etc.

(1) Survey method: This method is used to gather the data which has wide coverage and
is more concerned about fixed time. It provides more exact result as the persons are
directly contacted with telephone, mail, internet etc. But it takes lots of time, response
is slow and this method doesn’t prove fruitful if the respondents do not provide
response at all.
(2) Interview:
In this type of method, persons are interviewed face to face and the data is gathered
by the interviewer. Then the collected data is summarized to get the final result and
through this, final decision is taken about the project. This method is time consuming
as face to face interview takes time but it provides the exact result as the interviewer
gets the chance to see the body language of the respondents.
(3) Observation:
In this method, behaviour of consumer is observed through video recording and data
is collected. This data is analyzed and then final decision is taken on that basis. This
method saves time compare to interview and survey method but relies more on the
assessor’s knowledge and ability to study the psychology.

4) Field Trial:
This type of method is used by some companies when it launches new product in the
new market because it doesn’t have any idea about the response. It analyses the
response of the customer and then come to final conclusion.

Focus Group Method: Used by the company:

There are many methods for data collection but in case of introducing a new or modified
product, FOCUS GROUP method is more suitable to carry out research. While conducting
this method, a group of 8-10 people will be formed who will share their idea about the
product design, fuel capacity, comparison with competitors’ product, attitudes of different
consumers, their expectation for value of money etc while discussion through brain-storming.
This group of 8-10 people will consist of heavy users of the car, loyal customers of the
company and similar in demographic characteristics. They will not be mixed up with upper or
lower socio-economic group. Their discussion will of 2 hours, video-tapped for further
analysis and participants will be rewarded with monetary gift for their contribution.

Data collection:

The company requires certain type of estimation before launching its new product in actual
market to find out its success. For that, it will collect

1) Secondary data- already collected by others for other purpose

2) Primary data- original information gathered for a specific reason/purpose

Before launching this car, the secondary data will be collected from sales reports of
the company, demographic information of Indonesia, Philippines, Malaysia and
Thailand such as income, population, education, size of potential market etc.
While primary data will be gathered through online survey, mail survey, interview,
focus group, observation etc.

The reason to select these sources is that the car is highly valued product and not
purchased frequently. Moreover, if data is collected only from one source, it will not
draw the clear picture. Secondary data collection is free, easy to collect and speedy
process while primary data provides the actual idea of current situation of the market.

Data analysis technique:

The research will be based on two types of techniques: qualitative and quantitative.

Qualitative techniques are based on thoughts, opinions, emotions and feelings. It is subjective
method. It will use parameters like observation, focus group, case study etc.

While quantitative techniques are based on numerical data. It gives the clear idea of research
by making the things separate so that it can be counted and modelled statistically. One can
measure and control. It will be based on dispersion, probability, mean, median and mode, etc.

While research about launching this car, I will use both the techniques as only if qualitative
technique is used, it will have limited review while for detailed and systematic analysis, both
techniques should be used to achieve the best of both the world.

c) Nature and Type of Resources:

For launching a new green car, Honda will require the resources like
 Human Resources like project team, employees like skilled and unskilled workers,
technical and non-technical staff, engineers, team for research and development, team
for product design and testing, marketing and advertising etc.
Finance to launch a new product and development
Physical resources like plant, machinery etc.
Raw materials and spare parts of car like
 Engine parts- pistons, engine valves, carboretors etc.
 Electrical parts- generators, starter motors, spark plugs etc.
 Drive Transmission and steering parts- gears, wheels, steering system, axles,
clutches etc.
 Suspension and breaking parts- brakes, brake assembles, leaf springs, shock
absorbers, brake assembles, leaf springs, shock absorbers, brake linings etc.
 Body and chasis parts- chasis, frames, brakes, steering etc.
Intangible resource like goodwill.

d) Sources of Resources:

HUMAN RESOURCES:

Human resources are the most important input in production and services. They are the
valuable assets of every organisation. Moreover, the Honda is an automobile company which
is highly labour and capital intensive. In case of Indonesia, Malaysia, Thailand and
Phillipines, skilled and unskilled workers are easily available. In addition, Honda has its own
glorious history and heritage, it is an international well-known company. So it can find these
resources very easily. For functioning at top and middle level, the company will recruit from
internal sources as the present staff is highly aware about the company policies.

Financial resources:

Honda has been dealing in automobile industry since 1948. It is well-established company. It
is already having strong financial position with $56,729,000 as retained earning and
$46,325,000 total shareholder’s equity at the end of March, 2010 which can be used for
research and development for launching a new car (UNIQUE).

(www.finance.yahoo.com accessed at 19:45 on 31/10/2010)

Raw material:

Honda will buy the above raw materials directly to the different automotive industries so that
it can cut the cost.

Physical Resources:

The company has to establish new plant for batteries to avoid fluctuation in price if it buys
from suppliers.

Intangible resources:
Good reputation is also required to build trust and confidence among customers so that they
can be easily convinced to buy the product. Honda is already having a good reputation in the
international market.

Task-3

Honda is the world famous brand in manufacturing the automobile products so it has no need
to take pain in establishing its position in the market. Moreover, it has already launched
Honda Civic in 2000, City version in 2005, the newest Honda City in 25th September, 2008 in
these four countries of South East Asian market. All these products have been highly
accepted by the customers and the company has lots of loyal customers in these countries.

Honda adopts marketing mix strategy to launch this green car at competitive cost of
production, price, place and promotion.

Product:
The product is a bundle of various features to satisfy the customer needs and expectations.
As the product is a car, its looks, design, engine, performance, gearbox, features, etc should
be extra ordinary and compete with competitors to succeed in the market. In case of Honda-
Unique, its design is like an arrow shot which is unique in real sense if it is compared with
the product of competitors.

Like the exterior/design, interior will also be extraordinary like the steering wheel is good to
hold, audio control, introduce i-pod connective music system, comfortable seats etc.

The engine of this car will be smallest but best in terms of technology. It will have full
fledged VTEC system, 116 bhp, automatic variant and having the paddle shift. This car will
be the most fuel saving car among its rivals. ABS(Anti-locking brake system),
EBD(Electronic Brake Distribution) and dual airbags will prove the standard feature of this
car.

(www.retailbrains.blogspot.com accessed at 00:46 on 02/11/2010)

Price:
Green car-Unique, will definitely be costlier than the other cars in the same segment of the
market as it will be based on Hybrid 4 Technology. Moreover, it will be purchased by only
those people who require outstanding car in terms of design, performance, comfort and
quality. In addition the car is eco-friendly as well. Also the feasibility or say the opportunity
to afford the car should be made very convenient to the customers by offering instalment
payment systems. Additionally a lot of money is saved as the alternative battery system of the
car is less expensive as a fuel than petrol, so customers will enjoy the benefit for their car in
the long run, a lot of savings is done in terms of money in the future.

Place:
The Honda has different manufacturing units at different countries like

 P.T. Honda Prospect Motor & P.T. Honda Precision Parts Manufacturing in Indonesia
 Peogh Plant in Alor Gajah, Melaka in Malaysia
 Thai Honda Manufacturing Co. Ltd. In Thailand
 Honda Cars Philippines Ltd. In Philipines.

All these units will manufacture the car and will make it available in standard quality, fast
delivery and good performance through distribution channels.

(www.world.honda.com accessed at 01:20 on 02/11/2010)

Promotion:
For a successful launch of any product, the promotion should be done in such a way that the
selected target audience is very well-aware about the product. The Customers should be made
aware of the benefits emerging from the product having long term benefits.

In this case, Honda is well known brand in all over the world. It generally prefers the silent
entry with less promotional activities rather than aggressive one. To launch this product, no
extra effort will be required as the company is well known in all over the world as well as
Honda has already introduced many models in these countries before. So this car will be
promoted in the same manner like through national newspapers, magazine and on television.

(www.retailbrains.blogspot.com accessed at 01:46 on 02/11/2010)

ANSOFF MATRIX:

This tool is used by the company to grow its market in- new or existing product in new or
existing market.
(www.varndean.ac.uk accessed at 02:11 on 02/11/2010)

Market Penetration: This strategy is used by the company to introduce the existing product in
the existing market to increase or maintain the market share. It can be achieved by
competitive pricing strategies, sales promotion, personal selling, advertising etc.

Product Development: This strategy is used to introduce the new product in the existing
market. This is done either through modification in existing product, improve quality at
different level or totally new product.

Market Development: It is used to introduce existing product in new market like new
geographical areas, new distribution pricing policies, product dimension etc.

Diversification: It is used to introduce new product in new market. It is a very risky as the
market and product both are new and proper risk assessment is required for that.

Strategy used by HONDA:-

While launching a new green car-Unique- in Indonesia, Malaysia, Thailand and Philippines,
the company will adopt PRODUCT DEVELOPMENT as it is going to launch a new product
in the existing market.

Task 3(b) MONITORING AND IMPLEMENTATION:

Every company aims to maximize its profit, minimise the cost, good return on investment,
increase market share. But to achieve these objectives requires systematic planning and
implementation and after implementation, monitoring and evaluation.
Honda has already set its standard and target to achieve. This target is based on financial
analysis like ratio analysis, variance analysis, cash budgeting, capital budgeting etc while
market analysis is done through demand analysis, market share analysis, etc. Sales budget
will be prepared for sales analysis, labour turnover and work/output measurement is done to
analyze human resource analysis and product analysis is done with product inspection.

Honda will use DEMAND ANALYSIS for monitoring and evaluation. In case of passenger
car, the sales of these four countries can be analyzed as:

Total sales in 2010 – 5,48,871 units which was 5,36,905 in 2009. It shows increase in demand
of car. If it is analysed further, 2% decrease in sales in Indonesia, 11% decrease in Thailand,
Malaysia maintained its position compare to previous year while Philippines posted higher
sales.

Thus it can be evaluated as the demand of car will increase in coming future as business
analysts are expecting project sales 5,66,500 in 2011 and 6,18,000 in 2014.

(www.philstar.com accessed at 04:17 on 02/11/2010)

After launching this car, the monitoring and evaluation will be done also on the basis of
various analysis like Net Profit Ratio, Gross Profit Ratio, Asset turnover, Return on Capital
employed etc.

c) FINDINGS:

MALAYSIA INDONESIA
Total car sales in 2009 -3,01,077 Total car sales: 4,60,000
Economy growth- 2-3% Economy growth:5%
Total population on July 2010-28,310,000 Total population on July, 2010-229,965,000

PHILLIPINES THAILAND
Total car sales-1,32,444 units Total car sales: 3,56,692 units
Economy growth-6% Economy growth-2%
Total population on July, 2010- 94,013,200 Total Population on July, 2010-67,070,000

(www.topgear.com accessed at 04:43 on 02/11/2010)

Moreover, Indonesia has always stood third in ASEAN car industry as per ASEAN
AUTOMATIVE FEDERATION and population wise it is bigger compare to 1st and 2nd
ranker. The sales of car in the last four months shows increase in Thailand and Malaysia.

Another remarkable fact is that the number of the Indonesian people who lies in the category
of the middle class is larger than the entire Malaysian population. Moreover, 30% of the
Indonesian population is having its average income larger than the entire population of
Thailand. Therefore, it can be said that the demographic picture and the distribution of
income will have eventual effect in the demand of cars.
Another finding is that the Indonesian lead in this rank will sustain in the future as well and in
fact the gap will widen in the next few years. This will help the Indonesia to become the
strongest car industry country in ASIA.

Another prediction about the Indonesian domestic car sales will be in the range of 610,000 to
650,000 units at the end of 2010. This can be predicted on the basis of the performance of the
last five months and the target may be exceeded as there will not be any significant change in
the economic environment.

In the long-term prospect, it can be expected that Indonesia may achieve the target of its first
million annual car sales in the next two to three years. With the pattern depicted by the
Brazilian car industry, we may have 2 million sales in the next 10 years. So it is the centre of
global car manufacturer and they can determine its strategy to penetrate the market.

Moreover, the government is already working on the programme to produce a low-cost green
car. So it will be easy to launch this car as government is already involved in this project.

(www.thejakartapost.com accessed at 11:33 on 05/11/2010)

(www.aseanaffairs.com accessed at 4:00 on 02/11/2010)

d)Recommendations:

From the above demand analysis and findings, it can be recommended that the economy of
these four countries have started to grow after the recovery stage. Moreover, the sales
analysis shows that the demand of car will increase day by day. As the economy of South
East Asian market particularly Indonesia, Malaysia, Philippines and Thailand shows growth,
support and interest by the government, increase in population, shift of lower middle class to
middle and upper category, there will be increase in standard on living, income level,
purchasing power etc. Another matter which is the fact that the population is increasing day
by day which will again result into increase in demand of car.

So, finally it can be recommended that launching a new car is a profitable project. Moreover,
launching an eco-friendly car which will save the environment and solve the problem of
global warming is again a positive aspect of launching this car.

CONCLUSION

From the above analysis of research project and proposal, it can be concluded
that to launch a new product is not an easy task. However, if the company takes the initiation
to save the environment and launch this product is profitable in many aspects. Moreover, the
company introduces this product in existing market where Honda has its own image. So, it
has no need to create its brand image in this market.

This car will prove unique as it uses Hybrid 4 technology and uses of battery
will be beneficial for the customers as they will not stuck if one fuel get finished. However,
the proper planning and implementation of the project will prove fruitful.
REFERENCES:

www.aseanaffair.com

www.alternative-car-fuels.co.uk

www.12manage.com

www.bangkokpost.com

www.thejakartapost.com

www.google.co.uk

www.financeyahoo.com

www.retailbrains.blogspot.com

www.world.honda.com

www.varndean.ac.uk

www.philstar.com

www.seekingalpha.com

www.topgear.com

www.spottydog.u-net