Marketing Environment of India Automotive Industry
SUBMITTTED BY
ABHILASH VISWANATHAN
REG NO: 09095101
S2 MBA
ICM POOJAPPURA
SUBMITTED TO:
SIVAPRAKASH CS | MARKETING ENVIRONMENT OF INDIAN AUTOMOBILE INDUSTRY | | | | |
|
MARKETING ENVIRONMENT OF
INDIAN AUTOMOBILE INDUSTRY
Introduction
Forty years since India's independence from the British in 1947, the Indian car market was dominated by two localized versions of ancient European designs - the Morris Oxford, known as the Ambassador, and a old Fiat. This lack of product activity in the Indian market was mainly due to the Indian government's complex regulatory system that effectively banned foreign-owned operations. Within this system (referred to informally as the "license raj"), any Indian firm that wanted to import technology or products needed a license/permit from the government. The difficulty of getting these licenses stifled automobile and component imports, creating a low volume high cost car industry that was inefficient, unprofitable, and technologically obsolete.
The two dominant products Ambassador and Fiat, although customized to the poor road conditions in India, were based on a stale design concept (with outdated features), and were also fuel inefficient. In the early 1980's, the Indian government made limited attempts at reforming the automotive industry, and entered into a joint venture with Suzuki of Japan. The joint-venture, called Maruti Udyog Limited, launched a small but fuel efficient model (called "Maruti 100"). Priced at about $5,500, the product became an instant hit. The joint venture now produces three small-car models, a van, and a utility vehicle at a rate of more than 250,000 a year. Despite being a late entrant, Maruti's vehicles are estimated to account for as much as 70 per cent of India's car population.
In 1991, a newly elected Indian government took over and faced with a balance-of-payments crisis initiated a series of economic liberalization measures designed to open the Indian economy to
ABHILASH VISWANATHAN
REG NO: 09095101
S2 MBA
ICM POOJAPPURA
SUBMITTED TO:
SIVAPRAKASH CS | MARKETING ENVIRONMENT OF INDIAN AUTOMOBILE INDUSTRY | | | | |
|
MARKETING ENVIRONMENT OF
INDIAN AUTOMOBILE INDUSTRY
Introduction
Forty years since India's independence from the British in 1947, the Indian car market was dominated by two localized versions of ancient European designs - the Morris Oxford, known as the Ambassador, and a old Fiat. This lack of product activity in the Indian market was mainly due to the Indian government's complex regulatory system that effectively banned foreign-owned operations. Within this system (referred to informally as the "license raj"), any Indian firm that wanted to import technology or products needed a license/permit from the government. The difficulty of getting these licenses stifled automobile and component imports, creating a low volume high cost car industry that was inefficient, unprofitable, and technologically obsolete.
The two dominant products Ambassador and Fiat, although customized to the poor road conditions in India, were based on a stale design concept (with outdated features), and were also fuel inefficient. In the early 1980's, the Indian government made limited attempts at reforming the automotive industry, and entered into a joint venture with Suzuki of Japan. The joint-venture, called Maruti Udyog Limited, launched a small but fuel efficient model (called "Maruti 100"). Priced at about $5,500, the product became an instant hit. The joint venture now produces three small-car models, a van, and a utility vehicle at a rate of more than 250,000 a year. Despite being a late entrant, Maruti's vehicles are estimated to account for as much as 70 per cent of India's car population.
In 1991, a newly elected Indian government took over and faced with a balance-of-payments crisis initiated a series of economic liberalization measures designed to open the Indian economy to