Case on

Bajaj Pulsar Bike

Market Planning (Final submission)
Term I

(Course Instructor Professor Neelu S. Bhullar)

NMP XX Group-XIII Abhya Nand Singh, 20NMP-03 Rajeev Kumar, 20 NMP-66 B. Venkata Rao, 20 NMP-16 Manoj Kumar Gupta, 20 NMP-30 Kundan Kumar, 20 NMP-28

NATIONAL MANAGEMENT PROGRAMME (NMPXX) EXECUTIVE PGPM MANAGEMENT DEVELOPMENT INSTITUTE GURGAON-122001

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TABLE OF CONTENTS Executive Summary 1.0 Bajaj Auto Profile 2.0 About Pulsar Bike 3.0 Market Environment 4.0 Swot Analysis For Pulsar 5.0 Consumers Of Bajaj Pulsar 5.1 5.2 5.3 Consumer Behaviour Interview Of Recent Buyers Of Bajaj Pulsar Suggestions/ Satisfaction 6.0 Competitor Analysis 6.1 Overview Of Competitors 6.1.1 Hero Honda Motors Limited 6.1.2 Tvs Motor Ltd 6.1.3 Honda Motorcycles & Scooters India Pvt. Ltd 6.1.4 Kinetic India Ltd 6.1.5 Yamah Motor India Ltd 6.2 Strengths & Weaknesses Of Competitors 7.0 Market Segmentation 7.1 Broad Segmentation In Two Wheeler Industry 7.2 Sub Segmentation of Motorcycle Segment 7.2.1 Profile Of Various Segments And Price Range 7.3 Market Targeting By Bajaj Auto & Its Competitors 7.4 Market Positioning Of Bajaj Pulsar 8.0 Conclusions References Recommendations For Ensuring Customer

Annexure-1
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Bajaj Pulsar Bike

I told you to bring our Pulsar wife provoked for second time while driving back to home last month. Way back a month, I made a visit to my native place HAL Amethi, just after finishing the Mid Term-I exams at MDI Gurgaon. (This experience is narrated by Manoj kumar Gupta, an executive of HAL, currently a participant of National Management programme at MDI, Gurgaon) Since I was outside for a long period of almost over one month, I had to face a big shopping list and fulfill the promises made on phones. My home is located 15 kms. away from Amethi city. It was 28th of May 07, my wife chalked out plan and we were ready to make a Amethi city trip this evening. It seemed that she was ready with the list and even bigger dream. At evening just before departing from home, she enquired of vehicle we were to go with. I promptly replied of course with car. I could see the question mark on her face. The options were, bike (Pulsar) or car (Wagon R). Cant we go with bike? Wife asked; No we have to shop many things, I summed up with. Our short distance journey started with car. It took 20 minutes to reach the city. It was the highly rush hour and we needed to park the car. I had to struggle to park the car that evening, and could hardly find the place for parking. As soon as we started walking towards the shops after locking the car, the first sentence, my wife spoke was So difficult to park, I told you to bring the pulsar. After an hour of shopping and golgappa programme, we had only an additional bag packed with some dresses and few cosmetics. For the remaining part of shopping, we had to move to jewelers market 3 kilometers from this place. We went back to car and reversed anyway to pick the road ahead. While driving along the crowded road we were far slower in speed all along the road. Meanwhile one motorcyclist suddenly came in front of car and I could hardly save him to collide with the gap of centimeters. Immediately wife reacted Puzzling traffic, I told you to bring pulsar. By next half an hour we could finish our shopping and immediately caught the way to home. But still something was waiting to happen and a handsome jam appeared mid way because of trucks. We had to wait for at least five minutes until the jam cleared, But this time I became the first to say spontaneously Yes, we could have chosen pulsar for trip, wife was really glad to hear it. And we spent some time talking in the same context. Here, wife had a chance to justify her, the way she wanted. See, with bike we neednt to wait for such jams and could have enjoyed a free style trip also wife said. After the jam cleared we were cruising on the road directed towards our home. In rest of the journey there was a big argument going on, within my mind. The context was, who among us was right i.e. which was suitable means for that drive, whether car or bike? Also I was flooded with questions like; Is the bike best for short trips? are the bikes increasingly penetrating suburban and rural markets? Are the premium bikes, first choice of young people? Do the new generations ladies like to ride premium bikes Page 3 of 40

with their husbands for outing? What are the driving factors for liking of bikes in rural & suburban areas? Perhaps above are the facts, which may help us concluding the fast growing trend of two wheeler market. The Bajaj Auto limited has a 72% of market share in India for 180CC bikes segments. EXECUTIVE SUMMARY The expected rise in household income, easy availability of consumer finance, growing replacement demand, frequent introduction of newer trendy models by players and the increasing aggressiveness of key players will fuel two-wheeler growth in the long term. Overall demand will be driven by accelerated growth in motorcycle sales. The expected surge in rural demand will play a key role in steering motorcycle demand. Domestic motorcycle sales are expected to grow at a CAGR of 11.5 per cent, surpassing 10 million units by 2010.11. This massive climb will drive overall two-wheeler sales growth by 11.4 per cent to 13 million units by 2010-11.
TWO WHEELER SALES TREND

Competition in the motorcycle industry is mainly confined to three major players, i.e. Bajaj Auto, Hero Honda and TVS motors who among them are having 94% of the total market share. These three players are likely to continue dominating the market for some time to come. Consumer profile and the Segmentation of the motor cycle has been studied and the same is divided into three major segment, i.e. Economy, Executive and the premium segment. The economy segment consumer looks for value for money, Executive segment looks for product features as well as fuel economy, whereas premium segment consumer looks for performance. Technology and R&D will be the key feature in driving Page 4 of 40

the consumer up the value chain. Profitability of the premium segment is the highest, whereas the economy and the executive segment will provide the volumes. Bajaj Auto has maintained its leadership position in the economy segment and it is catching up with market leader Hero Honda in the executive segment. However, the real edge for Bajaj Auto comes in the premium segment. The company will have to keep investing in R&D and keep up with new product innovations to maintain its leadership in this segment. The company can really expand its probiking niche segment by continuing to provide superior value proposition to the consumer. 1.0 BAJAJ AUTO PROFILE: The Bajaj Group is amongst the top 10 business houses in India. Its footprint stretches over a wide range of industries, spanning automobiles (two-wheelers and three-wheelers), home appliances, lighting, iron and steel, insurance, travel and finance. The groups flagship company, Bajaj Auto, is ranked as the worlds fourth largest two- and three- wheeler manufacturer and the Bajaj brand is well-known in over a dozen countries in Europe, Latin America, the US and Asia. It was founded in 1926 by Jamnalal Bajaj. His son, Kamalnayan Bajaj took over the business in 1942. He not only consolidated the group, but also diversified into various manufacturing activities. The present CMD of the group, Rahul Bajaj, took charge of the business in 1965. Under his leadership, the turnover of the Bajaj Auto, the flagship company has gone up from Rs.72 million to Rs.46.16 billion (USD 936 million), its product portfolio has expanded and the brand has found a global market. For our marketing planning project, we have selected Bajaj Pulsar ( product of M/s Bajaj Auto Ltd.) 2.0 ABOUT PULSAR BIKE Before the introduction of the Pulsar, the Indian motorcycle market trend was towards fuel efficient, small capacity motorcycles (that formed the 80-125 cc class). Bigger motorcycles with higher capacity virtually did not exist (except for Enfield Bullet). The launch and success of Hero Honda CBZ in 1999 showed that there was latent demand for performance bikes. Bajaj took the cue from there on and launched the Pulsar twins (150cc & 180cc) in India on November 24, 2001. The Pulsars excited segments of Indian youth, mainly due to muscular shape, stylish design and powerful engine (in Indian context) at reasonable fuel efficiency and affordable cost. The Pulsars are believed to be greatly successful in redefining the market trend. Since the Page 5 of 40

introduction and success of Pulsar, the Indian youth began expecting high power and
Company Specs. Type Apache 4 Stroke, air cooled TVS Fiero Fx 4 Stroke, Air Cooled Hero Honda CBZ Achiever EXTREME Air Cooled, 4 Stroke, 4 Stroke, Air Cooled, 149.2 c.c. 10.6 KW (14.4 Ps) @ 8500 rpm 5 Speed 149.1cc 10 KW (13.4 Bhp) Pulser 150 4 Stroke, Air Cooled 143.9cc 12 BHP @ 8500rpm Bajaj Pulser 180 4 Stroke, Air Cooled 178.61cc 15 BHP @ 8000rpm Avenger 4-Stroke, DTS-I Honda Uni Corn 4 Stroke, Air Cooled 149.1 cc 13.3 bhp @ 8000 rpm (9.9 KW) 5 Speed Kinetic GF 170 4 Stroke, 4 Valve engine

Displacement 147.5cc Maximum Power 9.95kw / (13.5 bhp) @8500 rpm 5 Speed

147.5 cc Maximum Power 12 bhp (8.95 kW) @ 7000 rpm 4 Speed

180 cc 16.5 bhp/12.15 Kw @8000 rpm 5 Spped

165.12 cc 14.8bhp@80 00rpm

No of gears

5 Speed

5 Speed

5 Speed

5 Speed

other features from affordable motorcycles.

As of 2006, the Bajaj Pulsars arguably form the most popular motorbike product in the newly emerging 150+ cc class of Indian two wheeler market. Bajaj Pulsar directly competes with several other Indian motorbikes in this class, such as, CBZ from Hero Honda, Apache and Fiero Fx from TVS, Unicorn from Honda and a few models from Yamaha and Suzuki. To retain Pulsar's position of leadership in its class, Bajaj Auto has been regularly making alterations to it to make the motorbike look afresh at all times. Due to the shape of the fuel tank, many Sri Lankan youngsters refer the Bajaj Pulsar as "The Nut Crusher". Unfortunately, even in the upcoming model, the Pulsar DTS-Fi 220cc, the manufacturers have failed to change the way the fuel tank is constructed, leaving the problem un-rectified. Newly released 200cc pulsar has colored plastic coverings of oil cooler to change the shape of the tank. Bajaj Pulsar DTS-Fi has got the Bike of the Year 2007 by CNBC-TV18 Autocar and Auto Awards. Camparison of different models in premium segment bikes 3.0 MARKET ENVIRONMENT: Idia is the second largest manufacturer and producer of two-wheelers in the world. It stands next only to Japan and China in terms of the number of twowheelers produced and domestic sales respectively. The Indian two-wheeler industry made a small beginning in the early 50s when M/s Automobile Products of India (API) started manufacturing scooters in the country. Until 1958, M/s API and M/s Enfield were the sole producers of two wheeler. In 1948, Bajaj Auto began trading in imported Vespa scooters and three-wheelers, and in 1960, it set up a shop to manufacture them in technical collaboration with M/s M/s Page 6 of 40

Piaggio of Italy. Under the regulated regime, foreign companies were not allowed to operate in India. It was a complete sellers market with the waiting period for getting a scooter from Bajaj Auto being as high as 12 years. The motorcycles segment was no different, with only three manufacturers viz M/s Enfield, M/s Ideal Jawa and M/s Escorts. The two-wheeler market was opened to foreign competition in the mid-80s. The industry witnessed a steady growth of 14% leading to a peak volume of 1.9mn vehicles in 1990. With the availability fuel efficient low power bikes, demand swelled. There has been a steady growth in the demand for motorcycles in India. Earlier, it was seen more in rural areas for its ease in maneuverability and wider wheel base leading to greater stability. Later, it became popular among all sections of the society, particularly the urban youth who liked the speed and style it imparted (to their personality). The motorcycles overtook scooters market in 1998-99 and have not looked back. It is noteworthy to look at the sales of FY2006-07 is 7.78 mn as compared to 6.87mn of previous FY year.
Hero Honda
16, 16% 6, 6% 5, 5% 4, 4%

Bajaj Auto TVS Motors Yamaha Motor LML

23, 23%

46, 46%

Motor cycles' Market share In India

Others

Two Wheeler's market in India

11, 11% 22, 22% 1, 1%

Motorcycles Scooters Mopeds Others

66, 66%

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4.0 SWOT ANALYSIS FOR PULSAR STRENGTHS: Bajaj Brand Image since 1950 . Network of 498 dealers and over 1,500 authorised service centers across the country. Around 1,400 rural outlets have been created in towns with population of 25,000 and below. Overseas distribution network covers 50 countries world wide to cater export market. Indigeniously developed bike in premium segment . Digital technology for ignition ( DTS-i) to improve performance of the bike. Sturdy and most suitable for Indian roads. Stylish muscular Body shape attracted Indian Youth. Introduced Digital display for the first time in premium segment. Highest fuel economy in its class. Different variants are available. Undisputed market leader in premium segment . Value for money and Value for customer. Pulsar is being customised as per constantly changing customer needs. Strategically located manufacturing facilities to reach nook & corner of India. Overseas distribution net work world wide

WEAKNESSES: Unable to tap 100 & 125cc market segment customers due to little higher price. Many customers calling this as "The Nut Crusher" bike due to its fuel tank shape. Body shape has been the same in other variants also. Page 8 of 40

OPPORTUNITIES: In 50 countries world wide, where M/s Bajaj Auto perceives a good market potential. Its in a position to invest in manufacturing activities apart from marketing, distribution and after sales & services through a well-established global network. Exports contributes only 11% in its volume, hence there is a scope for improvement. High potential to tap rural market in India.Bajaj Auto has already defined specialist dealerships for rural markets, called 'Rural Dealerships'. Opportunity to tap higher-end customer (Probikers), who are knowledgeable, appreciative of contemporary technology, they are trendsetters and very choosy about what they ride. Bajaj Auto is in the process of setting up a chain of retail stores across the country exclusively for high-end, performance bikes.

THREATS: 5.0 Highly stiff competition in its class in the recent past by many leading players of two wheeler manufacturers. Threat from low cost ( A-segment) and secondhand cars. CONSUMERS OF BAJAJ PULSAR

Motorcycles have been witnessing an upward sales trend due to changing consumer preference fuelled by new launches. Rising income levels of Indian middle class consumer were moved from scooters to motorcycles. Currently approximately 80 % of the market demand of two wheelers consists of motorcycles.

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(Source: WAY2WEALTH, Industry update for 2 two wheelers dated 13-04-05 for Financial year 2004-05)
Also initially there was demand for low power motorcycles in the engine capacity of 100 cc. But now, more and more demand for higher power engines (Premier segment) is being created. The below tables indicates the percentage of motorcycles in total two wheelers segment. Also initially the market for motorcycle had a rural bias. But the trend has changed towards a more balanced rural and urban segment. Further, export is also an area of growth of motorbikes increasing steadily year on year. With the booming exports, Bajaj Auto Limited (BAL) is partly insulated from the slowdown in domestic markets as exports form 16% of total sales. Bajaj Auto Ltd. has to keep their thrust on export market and exploit the opportunity more aggressively than its peers. (Source: 2 wheeler sector update dated 11-04-2007, Indsec Securities and

Finance Ltd.)

Market Segmentation
Segment North East West South Share(%) 26 12 32 30

Demand : Past & Future

Year 1990-91 mn no. 0.47 0.43

1991-92 1992-93 1993-94 1994-95 1995-96

0.38 0.46 0.65 0.86 1.03 1.18 1.44 1.79 2.18

Market Growth Rates

1990-91 - 1996-97 13.9%

1996-97 1996-97 - 2001-02 23.4% 1997-98 2001-02 - 2006-07 18.2% 1998-99 2004-05 - 2009-10 11.7% 1999-00 2009-10 - 2014-15 9.0% 2000-01

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Leading Players
Company Hero Honda Bajaj Auto TVS Motors Yamaha Motor LML Share (%) 46 23 16 6 5

2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2014-15

2.95 3.84 4.6 5.3 6 6.8 7.55 8.4 9.2 14.15

(Source: Market forecast for automobiles two/ three wheeler industry available at http://www.indiastat.com)

5.1

CONSUMER BEHAVIOUR

The salient features of consumer behaviour with respect to the product Bajaj Pulsar bike are given below: Income Factor: The occupation types and the income pattern of the consumers play a very vital role in the buying behaviour of motor bike or any other two wheeler. It can be seen that the choice of the product largely depends upon the kind of budget a consumer is able to allocate. This certainly depends on the individual requirements too. Due to growth of economy, the per capita income in India is increasing significantly which has resulted in increase in disposable income. The rise in disposable income coupled with easy availability of finance by various banks at reasonable interest rates is the major driving force which has greatly influenced the consumers for owning bikes of their choices. Personal Factor: Consumers opinion about a product is influenced by his own experiences, his choices and his beliefs he has developed. Any consumer personally develops his choices due to his age, his stage in the life cycle, his psychological needs, his status in the society, his lifestyle, his personality, his self-concepts etc. His beliefs are influenced by the circumstances he faces in his life. The young generation male population has aspirations for more stylish and powerful bikes having latest technology Page 11 of 40

and the features rather than the old and staid looking scooter of yesteryears or even bikes of smaller capacity and power. The educational level of the consumer effects his decision to go for newer designs which are more in tune with the modern times. Social Factor: Consumers buying pattern is also influenced by his immediate associates such as his family members, his friends, his co-workers his neighbors and his acquaintances. They all have influence on his buying behavior. Any consumer while buying a particular product is also mainly influenced by his immediate family. Now-adays, people are becoming more outwardly oriented. Also people are becoming more consumption oriented. Further, there is shift from joint family to nuclear family which has resulted in more aspirations for the individuals. Effect of the peer group is also becoming more pronounced in shaping the consumer behavior. Psychological factors: Psychological factors play a very important role in the buying decisions of a consumer. Many needs, arising out of the psychological states of mind which the consumer undergoes while making a decision to buy, play important role. These needs are vital in influencing the motive of buying. 5.2 INTERVIEW OF RECENT BUYERS OF BAJAJ PULSAR

As a part of this project work, twelve recent buyers of Bajaj pulsar motor bike were interviewed through questionnaire method and interaction with them by the group members. A copy of questionnaire is enclosed at Annexure-1. Questionnaire included questions regarding age profile, income levels, occupation types, factors affecting buying behaviour, feedback of the customers on performance of the bike. A brief analysis of interview is presented below:

Age Group
60 50 40 30 % 20 10 0 18-25 26-35 Years 36-45 45+ % 70 60 50 40 30 20 10 0 Student

Profession

Business

Employed

Unemployed

Out of twelve respondents, ten belonged to less than 35 years age group, where as only two were over the age of 35. Among the respondents below 35 years of age, 40% were below 25 years while the remaining 60% were in the age bracket of 25-35 years. As Page 12 of 40

regards the profession of the respondents, four were students, two business people and six were salaried people. This shows a bias toward young college going people and those people who are in the early stages of the careers.

Annual Income
90.0

Primary Use
80.0 70.0 60.0 50.0

70.0 60.0 50.0 40.0 % 30.0 20.0 10.0 0.0 Upto 1 Lac 1 to 3 lacs 3 to 5 lacs above 5 lacs Income

40.0 30.0 20.0 10.0 0.0

Work Place

Market/ outing

Passion/ Adventure

Purpose

Annual house hold income of most of the respondents fell into one lac to 3 lacs category. Three respondents had an annual house hold income of less than one lacs where as two respondents also had annual income of more than five lacs. Most of the respondents used the bike for commuting to their work places. This also indicates that the respondents were in the early stage of their work careers or college going students. One respondent each suggested that their prime usage was for market outing or passion/ adventure.
Average Monthly run (kms.)
60.0 50.0
6.00 5.00 4.00

Parameters influenced buying decision

Rating

40.0 30.0 20.0 10.0 0.0 Upto 700 700 to 1000 1000 to 1500 1500 to 2000 Above 2000 %

3.00 2.00 1.00 0.00

ag e

ok / lo Dr ivi n

ed n

Mi le

Br an di

tiv e

St yl e

Most of the respondents, i.e. approximately 75% had a monthly running of their bikes of less than 1000 km. However, some respondents also had high running of more than Page 13 of 40

Co mp te

Ru gg

gc

om f or t

s es

ma ge

pr ice

2000 kms. As regards the parameters which affected their decision to buy the bike, all parameters like were pricing, ruggedness, mileage, driving comfort, style/ look & brand image more or less equally important. However, style/ look scored the highest among the influencing parameters. Ruggedness and driving comfort were the other more important parameters.
Advertising Media
6

Communication Channel
5

5 3 2 1 0 TV/ Radio New spaper/ Magazine Hoardings Critic report

O w n

Rating

4 3 2 1 0

e Ad ve rt i se m en Fr t ie nd s/ re la tiv es

ex pe r

Of the various channels communication channels which affected the decisions of the consumer to buy the product, majority of the respondents indicated advice from friends, relatives or their own experience. Only three respondents indicated brand image and advertising. Of the three alternative channels of advertising, i.e. TV/radio, newspaper/magazine and hoardings, respondents were equally divided.

Fa m ily

ad vi c

Alternate Choice
6 5 4 3 2 1 0 TVS Apache Suzuki Fiero Hero Honda CBZ Hero Honda Achiever Honda Unicorn Kinetic GF-170

Respondents considered various other brands available in the market before buying Bajaj pulsar. Among these Suzuki Fiero and hero Honda CBZ were considered by five each of the correspondents. Two of the respondents considered TVS apache before buying the Bajaj Pulsar.

Br an d

ie nc e

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Overall Performance
8 7 6 5 4 3 2 1 0
Go od nt go od Sa t is fa cto ry Ex ce l le ry ati sfa cto
9 8 7 6 5 4 3 2 1 0 Very

Afte r Sales Service

dissatisfied

Ru gg ed

Co m pt et iv

5.3

SUGGESTIONS/ RECOMMENDATIONS FOR ENSURING CUSTOMER SATISFACTION

During survey, the respondents suggested the following scope for improvement. Some of the suggestions relate to the design of the product, whereas some are related with service centres. Suggested improvements at manufacturing stage: Improvement in quality of body paint (UV radiation protection) to prevent early fading of colour Introduction of tubeless tyres in all variants/ models in order to enhance grip on the road and avoidance of immediate deflation on puncture Price reduction Apex features (digital panels, LED tail lamp, oiled cooled engine) in all variants Better look of body Additional new features like digital panels should be cost free Suggested improvements at Service centre: Page 15 of 40

Br an d

St yl e/ l

Most of the respondents were satisfied but not very satisfied. This is also reflected in their ratings of very good and good but not excellent. Of the parameters which respondents were most satisfied was style. So customer expectations are very high. It is clear form data that no one very unsatisfied with performance.

Performance feedback
4.60 4.40 Rating 4.20 4.00 3.80 3.60 3.40
pr ice ne ss ag e ile ag e im oo k

dissatisfied

satisfied

satisfied

Neither

Ve ry

Un s

Very

nor

on

Crowd management at service centers like effective utilization/ capacity enhancement at service facilities and improvement in amenities. Establishment of telephonic assistance for technical and maintenance information. Creation of database of customers to facilitate reminding next service dates.

The most important finding from the interview of the customers is that M/s Bajaj Auto Ltd. has to thrust upon the improvement in After sales service facilities to achieve higher level of customer satisfaction 6.0 COMPETITOR ANALYSIS

Competitors of a product are not only the direct competitors competing in that particular segment, but all direct, indirect and potential solutions which satisfy the same need of the consumer are considered as competitors. In fact this concept is to be taken further to include all products or services which are competing for the consumers budget. Hence the competitors of Bajaj pulsar Motorcycles have been identified on different levels of product form, product category, generic need level and the consumer budget level. Competitors in the product form level are those brands which are directly competing with BAJAJ PULSAR in the premium motorcycles segment, i.e. Hero Honda Achiever, Hero Honda CBZ, Honda Unicorn, TVS Apache, Yamaha Gladiator and LML Graptor. In the product category of two wheelers are all those players which are in the products like scooters, mopeds, scooterettes, motoscooterettes and motorcycles of all segments, i.e. entry level, premium and sports bikes. The third level of competitors are those who are satisfying the generic need of transportation and includes various forms of public transport like buses or suburban rail system, auto/taxis, second hand cars and segment A cars. The fourth levels of competitors are those who are vying for the consumers budget. These have been illustrated in the diagram shown below.

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Vacation/Holiday package Auto/Taxi

Scooters Scooterettes Mopeds PULSAR CBZ, Achiever, Unicorn, Apache Fiero Bicycle

Small Car

Invest ment

Sports Bikes

Laptop/PCs

PRODUCT FORM PREMIUM SEGMENTMOTORCYCLE Entry level bikes SS Second hand car Motoscooterettes PRODUCT CATEGORY: TWO WHEELERS Public transport (Buses/Metro/Suburban) GENERIC NEED: TRANSPORTATION

White goods

CONSUMER BUDGET

LEVELS OF COMPETITION FOR BAJAJ PULSAR

6.1 Overview of Competitors: Page 17 of 40

India is the second largest market for two wheelers in the world and the motorcycles command 82% of the total no. of two wheelers sold in India. Competition in two wheeler space has been heating up with new launches happening consistently across segments. An overview of competitors with their relative strengths, weaknesses, size, profitability, growth and strategies etc. is presented here. 6.1.1 Hero Honda Motors Limited: Hero Honda is currently the worlds largest motorcycle manufacturer thanks to its fuel efficient, high quality products made in collaboration with Honda motorcycles, Japan.The range of Hero Honda motorcycles include the Hero Honda Dawn, Hero Honda Splendor, Hero Honda Passion, Hero Honda Glamour, Hero Honda CBZ and Hero Honda Karizma. When Hero Cycles and Honda Motor Company of Japan inked their joint venture in India in April 1984, few could have imagined that the two would go on to create history. In a little over two decades, the world's largest manufacturer of bicycles and the global leader in motorcycles have created the world's single largest motorcycle company. The company has sold over 15 million motorcycles and has consistently grown at double digits since its inception and today, every second motorcycle sold in the country today is a Hero Honda. The current sales and financial highlights of the company are given in the table below.

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SORCE: http://www.herohonda.com/investors_pdf/financials_at_glance.pdf

Hero Honda has built two world-class manufacturing facilities at Dharuhera and Gurgaon in Haryana that now churn out over 3 million bikes per year. During the year substantive expansion have taken place in both the plants raising the capacity to manufacture close to four million bikes per year. Third Greenfield project at Haridwar is under progress which will initially augment the capacity by 0.5 millions bikes by mid 2007 and eventually increase the capacity to 1.5 million bikes per year by 2010. Hero Honda has got a very strong dealer network and customer relationship program. Hero Honda has set up over 2400 customer touch points, comprising a mix of dealers, service centres and stockists across rural and urban India. Hero Honda has built and cultivated a strong network and relationship with internal and external stakeholders, Page 19 of 40

including Investors, Dealers, Vendors and Employees. These relationships have helped the company hold on to the mantle of World No.1 for years in succession. The main strength of Hero Honda is synergy. The two partners, leaders in their respective domains, have been able to consistently draw on each other's strengths. The Hero Group's deep domain knowledge of the Indian market and its supplier network has meshed with Honda's mastery over four-stroke engine technology to create modern and fuel-efficient machines at affordable prices for Indias 250-300 million strong middle class. Progressively through the 1980s, the 1990s and now in the 2000s, Hero Honda has relied on 3 R's-- Reach, Research and Reliability as its basic building blocks. Using feedback from the market, a fully-equipped R&D center has consistently created best practices in designing, testing and harmonization, besides placing strong emphasis on road safety and ride quality. This emphasis has helped Hero Honda build products that are ahead of their time. In the 1980s, for example, Hero Honda became the first company in India to prove that it was possible to drive a vehicle without polluting the roads. The company introduced new generation motorcycles that set industry benchmarks for fuel thrift and low emission. A legendary 'Fill it - Shut it - Forget it' campaign captured the imagination of commuters across India, and Hero Honda sold millions of bikes purely on the commitment of increased mileage. Hero Honda was also one of Indias first automotive companies to get close to the customer. Over the years, feedback has flowed back and forth seamlessly through a unique CRM program - the Hero Honda Passport Program which now has over 2.5 million members on its roster. The program has not only helped Hero Honda understand its customers and deliver value at different price points, but has also created a loyal community of brand ambassadors. HHML introduced cutting edge fuel injection technology in its GLAMOUR Model and it is the first company to do so. The company further wants to introduce this technology in other models also progressively. Company is committed to maintain its leading position in the ever growing Indian market. As Brijmohan Lal Munjal, the Chairman, Hero Honda Motors succinctly puts it, "We pioneered India's motorcycle industry, and it's our responsibility now to take the industry to the next level. We'll do all it takes to reach there. 6.1.2 TVS Motor Ltd: TVS group was formed as a transport company in 1911 as a leading producer of automotive components. It entered two wheeler industry in the 1980s. TVS Motor was originally incorporated in 1982 as Indian Motorcycles Pvt. Ltd to produce motorcycles in collaboration with Suzuki, Japan, the company later went public under the banner Page 20 of 40

Ind-Suzuki Motorcycles Limited, which was later renamed TVS-Suzuki Limited. The perfect blend between the best design engineers and the latest technology made TVSSuzuki one of the leading (Third largest) two-wheeler manufacturers in the country and has reached tenth position among the world listing. TVS Apache has already become the number 2 brand in the premium segment of the motorcycle market and is expected to gain a sizeable share in the segment during the current financial year. It has two state of the art manufacturing plants with total capacity 2 mn vehicles, out of which motorcycles capacity is 1.3 mn vehicles. All India reach through excellent sales and service network. Its dealer and customer network is widely spreaded in India which includes over 500 dealers and 2500 customer touch points. Globally, TVS Motor Company is the first two-wheeler manufacturer to be honoured with the hallmark of Japanese Quality - The Deming Prize for Total Quality Management. TVS Motor Company recorded a growth of 26% per cent in turnover to Rs. 939.62 Crores, growth of 32% in units of motorcycles sold to 233,506 units for the first quarter ended June 2006. Profit Before Tax (PBT) was at Rs. 30.14 crores and Profit After Tax (PAT) stood at Rs. 21.26 crores.

Source: http://www.tvsmotor.in/pdf/analystmeet2005.pdf

6.1.3 Honda Motorcycles & Scooters India pvt. Ltd.: Established in 1999, the Honda Motorcycle & Scooter India Pvt. Ltd. (HMSI) is a wholly owned subsidiary of Honda Motor Company Ltd., Japan and is located at Manesar, Haryana. Honda's dream for India is to not only manufacture 2-wheelers of global quality, but also meet and exceed the expectations of Indian customers with outstanding after sales support.

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The initial installed capacity of Honda plant was 100,000 scooters per year, which has reached 6,00,000 scooters by the year by 2007 and motorcycle capacity shall be 4,00,000 per annum. The total investment outlay for the initial capacity was Rs. 215 crores and now the accumulated investment is 800 crores. Honda launched Unicorn, its first motorcycle in the Indian market in 2004. Powered by a newly developed Honda 4-stroke, 150cc engine and incorporating cutting-edge technologies developed by Honda's global R&D team. Unicorn is an engineering masterpiece with international design appeal. Honda has tried to replicate its unique dealership and customer servicing centres in India in the same line as done across the globe. Wherever you travel across the globe, Honda dealerships stand out with their unique identity. The design of the dealership in India has also been done with the same purpose in mind. Every Honda dealership is known as a H.E.A.D. - Honda Exclusive Authorized Dealer. Each H.E.A.D. exclusively handles Honda 2-wheelers and promotes business activities based on policies that focus on customer satisfaction. They are the representatives of HMSI in their respective markets and provide 4S facilities under one roof as per Honda's worldwide standards. These include sales, service, spare parts and safety in riding. 6.1.4 Kinetic India Ltd.: The Kinetic Group of companies is a leading player in the automotive industry in India. Kinetic Group, founded in 1974, has sold over 6 million vehicles in India. It has a history of innovation and pioneering and has introduced several new concepts that have revolutionized the two wheeler industry. Kinetic brought the concept of personalized transport to India with the launch of the moped Luna in 1974. In 1984, it brought to the Indian customers the first-ever gearless scooter which has come to symbolize comfort, convenience and universal appeal. It has also brought to India new technologies such as four valve engines, electric start on scooters and motorcycles, vtwin engines, USD forks etc. It is the only company to offer top-end world class bikes Comet and Aquila to Indian bike enthusiasts. The group has an international technical collaboration with Hyosung Motors of Korea. It has three state of the art manufacturing facilities at Koregaon Bhima, Ahmednagar and Pithampur; and a nationwide network of nearly 450 dealers and over 1,000 service centers. The company exports vehicles to developed countries like USA, Canada, Latin America, Europe, Africa, Middle East and South Asia and has won several excellence awards for exports on state and national level. The company is preparing to launch some very exciting Italian designs over the next two years. The GF 170 Laser bike is another product of the Kinetic-Hyosung collaboration and is positioned in the premium segment of the two-wheeler market. The Page 22 of 40

GF 170 Laser sports a hip, sporty look thanks to its unique design elements that include twin headlamp, half-fairing, curvaceous rear-view mirrors, and a chunky masculine fuel tank. 6.1.5 Yamah Motor India Ltd.: Yamaha Motor India Sales Pvt Ltd is a wholly owned subsidiary of Yamaha Motor Co, Ltd, Japan. Its product range includes Gladiator, G5 in the standard segment and Crux and Libero in the basic segment. Having operated in India as technology provider for almost two decades, YMI was incorporated in August 2001 as 100'% subsidiary of YMC, Japan after severing its ties with Escorts. Since then Yamaha India has launched several models, however, their success rate in the market has been poor. At one time Yamaha was a leading player in the two stroke bikes, but after phasing out of two stroke technology due to stringent pollution norms, it has not been very successful in adapting to four stroke technology. As a result company market share has declined to 4%. However, the company is gearing for regaining its market share and has targeted to sell 1 million units per year by 2010. After the subdued response to the Fazer, Yamaha Motor India has made another foray into the executive bike segment with the Gladiator. 6.2 Strengths & Weaknesses of Competitors: COMPETITOR Hero Honda STRENGTHS Market leader Best dealer & service network Good resale value Fuel efficiency Large number of variants at each price point Good quality Indigenous design Third largest market share Comparatively good dealer and service network Robustness Durable spare parts WEAKNESSES Not so successful in premium segment

TVS Motors

Less fuel efficient Poor resale value Less no. of variants

Yamaha Motor India

Poor fuel efficiency Poor dealer & service network Page 23 of 40

 Kinetic Motor Good dealer network Brand image

Honda (HMSIL)

Sporty look Good design

Poor availability of spare parts No major technology innovation Poor resale value Poor aesthetics Dealership network not fully developed Poor availability of spare parts Only two variants Relatively new entrant in motor cycles

Comparitive features of different models:

Competing Bikes Particular s

LML Graptor

LML Graptor

Bajaj Bajaj Pulsar 180 Avenger (DTS-i)

Bajaj Avenger

Bajaj Pulsar

Hero Honda Hero Honda Honda Unicorn 150 Achiever CBZ(Disc Brake) cc

Hero Hero Honda Honda Unicorn Honda CBZ(Disc (Electric Start) Achiever Brake)

MouthShut Product Rating: Product Recommendation :

75%

83%

83%

93%

84%

94%

Fuel Consumption (kms/litre): Comfort: Reliability: Handling and Control: Looks:

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Price (Rs)* Engine Engine Displacement (cc) Maximum Speed (kmph) Engine Type Start Type Fuel Capacity (litres) Maximum Power (bhp) Mileage (kmpl) No. of Cylinders Other Features No. of Gears /Variator Electrics (AC/DC) Overall Length (mm) Height (mm) Wheelbase (mm) Ground Clearance (mm) Kerb Weight (kg)

50,900
150.8 NA 4-stroke Kick 17 13.45 NA 1 5 12V DC 1980 1150 1280 170 136

63,000
178.6 109 4-stroke Electric 14 16.5 45 1 5 12V DC 2185 1060 1475 162 155

58,875
178.6 127 4-stroke Electric 18 16 78 1 5 12V DC 2000 1065 1320 155 139

NA
149.1 101 4 Kick/Electric 12.5 13.4 NA NA 5 NA 2040 800 1290 160 134

54,100
156.6 100 4-stroke Kick 12.5 12.6 45 1 5 12V DC 2090 1115 1330 150 130

54,000
149.1 NA 4-stroke Electric 13 12V DC NA 1 5 12V DC 2090 1095 1340 168 139

Competin g Bikes: Particular s

Kinetic GF170 Laser

LML Beamer

Kinetic Motors GF-170 Laser

LML Beamer (Electric Start)

TVS Apache

TVS Fiero FX

Yamaha Gladiator

TVS Apache

TVS Fiero FX Disc

Yamaha Gladiator

MouthShut Product Rating: Product Recommendatio n:

85%

100%

88%

69%

94%

Fuel Consumption (kms/litre): Comfort: Reliability: Handling and Control: Looks:

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Price (Rs)* Engine Engine Displacement (cc) Maximum Speed (kmph) Engine Type Start Type Fuel Capacity (litres) Maximum Power (bhp) Mileage (kmpl) No. of Cylinders Other Features No. of Gears /Variator Electrics (AC/DC) Overall Length (mm) Height (mm) Wheelbase (mm) Ground Clearance (mm) Kerb Weight (kg) Source: Mouthshut.com

49,100
166 115 4-stroke Electric 13.7 14.6 50 1 4 12V DC 1968 1073 1292 195 134

54,000
151 NA 4-stroke Electric NA 13.45 NA 1 5 12V DC 1980 1150 1280 170 136

NA
147.5 NA 4 stroke Kick 16 13.5 NA 1 5 NA NA NA NA 1260 136

52,900
147.5 NA 4-stroke Kick NA 12 NA 1 4 12V DC 2020 1067 1270 155 126

NA
123.7 NA 4 Kick/Electric 13 NA 67 1 5 NA 2065 1100 1300 160 123

7.0

MARKET SEGMENTATION

Segmentation of any consumer market is carried out in order to target, adjust and fine tune the marketing program profitably by recognizing the differences in consumer preferences. The major segmentation variables used are: geographic, demographic, psychographic and behavioural. Impact of these factors and their relevance with respect to two wheeler industry in general and motorcycles in particular are outline briefly here. Geographic Factors: Main geographic factor in segmentation of two wheeler or motorcycle markets are rural versus urban markets. Preference of urban markets is mainly for executive and premium segments. Rise in income level of rural areas and the rising preference for motorcycles as a means of transport due to its sturdiness and high mileage is going to accelerate the motor cycle demand in rural areas. As high mileage along with satisfactory looks is important for rural consumers, demand will be mainly for the economy/entry segment and lower executive segment. Demand growth in rural areas will be more than urban areas in future, as shown in the graph below.

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Demand projection in urban and rural areas for motorcycles Another basis for segmentation can be domestic versus exports market and further segmentation of domestic market into four regions.

Market Segmentation
Segment North East West South Share(%) 26 12 32 30

Region wise market share of motorcycles; source: indiastat.com Although, exports in two wheelers are growing significantly (36% in 2005-06) mainly due rising demand for Indian motorcycles from Sri Lanka, Colombia, Iran and Philippines, its percentage to total sales is small at 6.8%.

Two-wheeler demand forecast (Urban, rural, domestic and Exports up to 2010-11) Page 27 of 40

Demographic Factors: Major demographic factors which affect the consumer preferences with regard to motorcycles or any two wheelers are age, stage in life cycle, gender, education level and income levels. Increasing proportion of the Indian population in the age group of 18-24 years is leading to the preference of consumers to mainly motorcycles and to some extent ungeared light scooters. Increase in education level of women is leading to demand for light ungeared scooters. Motorcycles are mainly used by young population who is unmarried or are married but at early stage of their life cycle with no or very young children. Profession wise, they are mainly students or young professionals. Psychographic Factors: Psychographic factors consist of life style, values and personality traits. According to SRIC-BI VALSTM classifications, consumers of motorcycles can be thought to either belong to achievers or experiencers, more likely the later type. Experiencers are young, enthusiastic, impulsive people who seek variety, and excitement. They spend a comparatively high proportion of income on fashion, entertainment and socializing. Achievers are successful goal oriented people who focus on career and family and buy premium products and demonstrate success to their peers. Both these groups have enough resources. Consumers of motorcycle are outdoor loving, adventurous sports oriented people who exhibit trendy life style. Behavioral Factors: Behavioral factors consist of mainly benefits sought by consumers, user status and loyalty status. Consumers of motorcycles may be seeking one or more of following benefits : fuel economy, style, sturdiness and riding comfort. First time users are mainly going for motorcycles or ungeared scooters. Many second time users are upgrading from existing geared scooters to motorcycles or going for higher capacity premium segment. Motorcycle consumer may not exhibit brand loyalty in case of going for up gradation and may opt for best value in the segment. Page 28 of 40

7.1 BROAD SEGMENTATION IN TWO WHEELER INDUSTRY: Two wheeler industry is broadly segmented into following categories: Mopeds geared scooters gearless scooters motorcycles However, sales wise motorcycle segment has grown to almost 82% of the total two wheeler market. This has happened because of shifting preference of young Indians for stylish and powerful motor cycles instead of traditional scooters, rise in income levels, increase in rural demand due to rising income levels in rural areas. The turn around came in 1998, when motor cycles overtook scooters and it has not looked back since then. This is illustrated from the following graph.

Motorcycle sales overtake Scooters in 1998 Changing sales patterns with respect to different two wheeler segments is also illustrated from following graphs.

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Source: TVS analyst meet 2005 (official TVS web site) 7.2 SUB SEGMENTATION OF MOTORCYCLE SEGMENT: The motorcycle segment can be further subdivided into economy, executive and premium segments. Comparison of economy, executive and premium motorcycles

Each segment has been further subdivided like Economy standard and economy deluxe, lower executive and upper executive, premium (mileage sensitive) and premium customer segments. can be further subdivided into economy, executive and premium segments.

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Motorycles: Segment-wise share for Industry (source: CRIS-INFAC) 7.2.1 PROFILE OF VARIOUS SEGMENTS AND PRICE RANGE:

Market Segment: Products, Characteristics and Price Range Segment Price Rang e 30,00035,000 Major characteristics of the consumer

Economy

1. Looking for good utility vehicle at low cost 2. Caters largely to low-income urban customers (largely small shop owners and traders, junior officers, salesmen and supervisor level officers), and low-income buyers from rural areas, who are highly dependent on monsoons and the overall economic performance

Executive

36,00045,000

1. The lower band of this segment is more conscious of economy, durability and style. 2. The upper band is more feature and style-conscious

Premium

46,00055,000

Highly status/style/feature/power conscious; nouveau riche. Preferred by Page 31 of 40

rising income urban youth, software sector executives Upper Premium 55,000 and above

BPO

and

Identified by either Engine Power and/or ultra premium features. This segment will not settle for less than the best.

Of late the the demarcation has been diminishing between various segments like economy and executive segments and competitors are launching products at various price points trying to fill the existing gaps. Also customer preferences are moving towards more pricey, powerful and stylish motorcycles.

Changing customer preferences within motorcycle segment Further, there has been a trend to consider the segmentation in terms of engine capacity and the motorcycle market is divided in three segments: (i) entry or the price category, (ii) value or the executive category, and (iii) premium or the performance category. With rapid growth of the motorcycle market, the consumer segments have been changing and newer niches have come into play. From late 2004-05, Bajaj Auto has been considering a new segmentation which, is as follows: 1. The 150cc+ segment, where Bajaj Auto's Pulsar twins and the Bajaj Avenger compete in this segment. Page 32 of 40

2. The 125cc segment, where Bajaj Auto competes with its Discover DTS-i. 3. The upto 110cc segment in which Bajaj Auto has its CT 100, Discover 110cc and more recently, the Platina. Market share as per this segmentation is as follows.

Segment wise Market share according to Engine capacity source: Bajaj Auto web site

7.3 MARKET TARGETTING BY BAJAJ AUTO & ITS COMPETITORS: In motorcycle segment, the top three major players, i.e Hero Honda, Bajaj Auto and TVS motor are following a differentiated marketing approach and targeting all the three segments by various offerings. However, they have dominance in different segments. Entry or economy segment is very price sensitive. However, the profitability is the lowest as the competition is very intense. In this segment Bajaj Auto has the maximum market share.

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Market share in Economy segment, FY 07 (4 months); source: Bajaj web site Executive or the value segment is mainly driven by product features and technology. Hero Honda is the leading player in this segment but, Bajaj Auto has been giving stiff competition in this segment and increased its market share to 21% in 2006-07. FY 05 FY 07 (4 months)

Market share in Executive segment; source: Bajaj web site In the premium segment, Bajaj Auto has the market leader position. The main drivers in this segment are technology and performance. This segment has the highest profitability and relatively low competition. This segment constitutes 10 per cent of the market. The driving force in the segment has been the Pulsar 150 DTS-i. After the introduction of a feature-upgraded model in October 2004, sales grew by 37 per cent during the year. In the higher end of this segment, Bajaj Auto is present with Pulsar 180 DTS-i and the Avenger DTS-i, which was launched during the year 2004. Initially, the Pulsar 180 was not differentiated from the Pulsar 150 in terms of looks. This was carried out in 2005-06, and resulted in a 64 per cent surge in sales of the Pulsar 180. Bajaj Auto continues its leadership position in this segment. During the year 2005-06, Bajaj Auto opened a new Probiking showroom in Pune exclusively for the high-end bikes - Pulsar 180 DTS-i and Avenger DTS-i. In February 2007, Bajaj Auto has launched its new Pulsar 200 model in this segment. FY 05 FY 07 (4 months)

Market share in Premium segment; source: Bajaj web site

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7.4 MARKET POSITIONING OF BAJAJ PULSAR: Bajaj Pulsar is positioned as a performance bike in the upper premium segment. Major value propositions for the positioning and differentiation of the brand in this segment was technology, design, styling and performance, which includes mileage, power and other things like reliability and comfort. Bajaj is rolling all of these into a product for its consumers. It's the combination of all of these five factors, which makes for a unique product and that's why we it is a great success. Bajaj pulsar has virtually redefined biking in this country. Pulsar, launched in 2001 is the market leader in the 150 cc + performance bike segment. More than that, this brand changed the fortune of Bajaj Auto Ltd. Before the launch of Pulsar, Indian bike market was divided broadly into Economy,Executive and Premium Bikes. In 1999 Hero Honda created a new segment of 150 cc performance segment with its CBZ. But Pulsar came and gave a new life into the Performance segment. Although not a pioneer, Pulsar made the performance segment one of the fastest growing segment in the two wheeler market. Apart from the performance, a major part of the success in creating the brand was the classic advertising campaign "Definitely Male ". The creative people found the new product from Bajaj distinctly different. It was Bajaj's first bike without Kawasaki label. The new bike was an R&D and design marvel. Pulsar was designed by the renowned design house Tokyo R&D. The creative team knew that the communication of this brand should also be different. They stuck upon the Big Idea of India's He-Bike. Although lot of bikes take the persona of Macho bikes it was more oriented towards being "sexy". The Big Idea was to position the bike as World's first bike endowed with a Gender. This led to the classic campaign of all times " Definitely Male". The campaign together with the design and performance catapulted the brand into stratospheric sales level. Bajaj targeted the 18-24 with Pulsar but later found that the brand appealed to a much older audience. This helped Bajaj to change its target audience to 21-35 years. Bajaj did not rest with the laurels. It knew that Pulsar is the golden key to control the entire bike market. Hence Pulsar got undivided attention from the company. In 2003 another milestone event happened in the product lifecycle of the brand. Bajaj launched its new technology DTSI. DTSi stands for Digital Twin Spark Ignition which delivered more power and efficiency. The increased performance of the brand took Pulsar to greater heights. 2004 and 2005 saw some cosmetic changes in the brand which excited the customers and thus cementing Pulsar's position in the market. Pulsar comes in two variants : 180 cc and 150 cc. Where 180 cc excited the performance bikers, 150 cc was for the mileage conscious ones. The 150cc variant took lot of customers away from the executive segment to the performance segment. Page 35 of 40

In order to cater to different segments, Bajaj has carved out its traditional dealership network into four distinct channels. For the first time in the industry, Bajaj Auto started its new chain of showrooms for performance biking under a new brand, Bajaj Probiking. Its targeted at offering the high-end customer a different pre- and postsales experience. In future all the bigger and more powerful bikes will be launched from the Probiking showrooms. Though dedicated showrooms for high-end products are a global phenomenon in the automobile industry, this is the first time its being tried out in India. Bajaj Auto, has tried to create a niche by concentrating on the biking community and creating Probiking showrooms. Bajaj Auto has further extended the portfolio with the launch of the new 200 cc Pulsar DTS-i recently. The latest offering has set new benchmarks in technology, performance, and styling to address the needs of a growing segment of pro-bikers. The new Pulsar has many firsts to its credit like an Oil cooler, both front and rear tubeless tyres, new digital console, use of split seats for styling and comfort and electric start as the sole means of engine cranking, dispensing with the kick lever. Pulsar 200 is being launched with a new campaign revolving round the concept of Free Biking. Launch of Pulsar 200 DTS-i would further reinforce its position in this segment. The bike joins the 150 cc and the 180cc Pulsar DTS-i to extend the Pulsar DTS-i range across a range of price and performance points. 8.0 CONCLUSIONS: Demand is continuously increasing for two wheelers bikes due burgeoning economy. Frequent introduction of newer trendy models by players and the increasing aggressiveness of key players will fuel two-wheeler growth in the long term. Rural demand will play a key role in steering motorcycle demand Easily availability of finance/loans and increasing disposable income of Indian middle class is a thrust to two wheeler industry. Major players Hero Honda, Bajaj Auto and TVS motors controlling about 95% market share. Technology and R&D will be the key feature in driving the consumer up the value chain. Vendors consolidation is taking place in the industry to maintain quality and competitive price. Dealers segmentation is taking place to serve effectively all targeted market segments.

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References: 1. Industry update on 2 wheelers dated 13 April http://way2wealth.com 2. Related information from Indiastat.com and indsecurities.com 3. Official web site of Bajaj Auto Ltd. 4. Official web site of TVS Motors 5. Official web site of Hero Honda 6. Official web site of Kinetic motors 7. CRIS INFC two wheeler annual report

2005

from

FORMAT OF QUESTIONNAIRE GIVEN TO RESPONDENTS

Annexure-1

Dear Sir / Madam, We are the students of Post Graduate Diploma in Business Management (PGDBM) Program at Management Development Institute, Gurgaon (Session 2007-08). We are carrying out a survey on Motor bike industry in India. In above regard, you are kindly requested to spare some time to attend to this questionnaire for your opinion. This study is solely for the academic purpose and forms part of the aforesaid PGDBM Program.

1.

What is your age group a) b) c) d) 18 25 years 26 35 years 36 45 years Above 45 years

QUESTIONNAIRE

2.

What is your profession? a) b) c) d) e) Student Business Employed Unemployed Any other (please specify) ____________________________________

3.

What is your annual house hold income a) Below Rs. 1 Lakh b) Between Rs. 1 Lakhs Rs. 3 Lakhs c) Between Rs. 3 Lakhs Rs. 5 Lakhs d) More than Rs. 5 Lakhs

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4.

Prime use of motor bike for you is: a) Reaching your work place b) Going to market/ outing c) Passion / adventures d) Any other (please specify) ____________________________________ What is the average monthly running of your motor bike: a) b) c) d) e) Less than 700 km 700 km 1000 km 1000 km 1500 km 1500 km 2000 km Above 2000 km

5.

6.

Please rank the following factors in order of preference* for your decision in buying BAJAJ PULSAR (*Order of preference should be given on a scale of 1-6; 1 = no preference, 2 = very little preference, 3 = little preference, 4 = moderate preference, 5 = high preference, and 6 = very high preference. For example, you give very high preference to price, please write 6 against option (a) price.): a) b) c) d) e) f) g) Competitive Price Ruggedness brand image Mileage Style/look Driving comfort level any other (Please specify) ______ ______ ______ ______ ______ ______ _____________

7.

What influenced your decision to buy Bajaj Pulsar ? a) b) c) d) e) Own experience Advice from family Advertising Advice from friends/ relatives Any other source (please specify) ____________________________

8.

Which advertising media has maximum influence on you: a) b) c) d) e) Television / Radio Newspaper/ magazines Hoardings on public places Article by critic or industry reports Any other source (please specify) ____________________________

9.

Which other models/ make of motor bike did you consider before purchasing Bajaj Pulsar? a) b) c) d) e) TVS Apache Suzuki Fiero Hero Honda CBZ Hero Honda Achiever Honda Unicorn

Page 38 of 40

10.

f) Kinetic GF-170 g) Any other source (please specify) ____________________________ How do you rate the performance of Bajaj Pulsar on overall basis ? a) b) c) d) e) Excellent Very Good Good Satisfactory Unsatisfactory

11.

How do you rate* the following factors of Bajaj Pulsars performance ? (*Please rate on a scale of 1-5; 1 = unsatisfactory, 2 = satisfactory, 3 = good, 4 = very good, and 5 = excellent. For example, you give ranking as Excellent to price, please write 5 against option (a) price. ): a) Competitive Price ______ b) Ruggedness ______ c) brand image ______ d) Mileage ______ e) Style/look ______ f) any other (Please specify) _____________ How satisfied you are with after sales service provided by the company/ dealer? a) b) c) d) e) Very satisfied Somewhat satisfied Neither satisfied nor dissatisfied Somewhat dissatisfied Very dissatisfied

12.

13.

If you are not fully satisfied with Bajaj Pulsar, please give reasons for dissatisfaction in brief: a) b) c) ____________________________________________________________ ____________________________________________________________ ____________________________________________________________

14.

Any suggestion(s) to Baja Auto Ltd. for improving your satisfaction level: ___________________________________________________________________ ___________________________________________________________________

T H A N K Name of the Respondent : ___________________ Contact No.: ___________________

Y O U

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Rajeev Kumar (Mobile: 9873549095) / A. N. Singh (Mobile: 9871795212) e-mail : [email protected] / [email protected]

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