INDUSTRY ANALYSIS REPORT ON

"AUTOMOBILE INDUSTRY"

Submitted in partial fulfilment of the requirements for the degree of

Bachelor of Business Administration

By

Aman N

Registration Number

20BBA0135

Under the guidance of

Assoc. Prof. TNVR. Swamy

VIT Business School

VIT Vellore

August, 2021

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 DECLARATION

I hereby declare that the Industry Analysis report on "Automobile Industry" submitted
by me, for the award of the degree of Bachelor of Business Administration to VIT is a
record of bonafide work carried out by me under the supervision of Assoc. Prof. TNVR.
Swamy

I further declare that the work reported in this thesis has not been submitted and will
not be submitted, either in part or in full, for the award of any other degree or diploma
in this institute or any other institute or university.

Place: Vellore

Date: signature of the Candidate

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 INDEX

SI. NO TOPIC PAGE NO

1 INTRODUCTION 4-5
2 VISSION AND MISSION 6
3 BOARD OF DIRECTORS 7-9
4 CSR ACTIVITIES 10
5 VARIETY OF PRODUCTS 11
6 BALANCE SHEET 14
7 SWOT ANALYSIS 15-17
8 PESTLE ANALYSIS 17-23
9 PORTERS ANALYSIS 23-24
10 CONCLUSION 24

INRODUCTION

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In 2020, India was the fifth-largest auto market, with 3.49 million units combined sold in the
passenger and commercial vehicles categories. It was the seventh largest manufacturer of
commercial vehicles in 2019.

The two wheelers segment dominate the market in terms of volume owing to a growing
middle class and a young population. Moreover, the growing interest of the companies in
exploring the rural markets further aided the growth of the sector.

India is also a prominent auto exporter and has strong export growth expectations for the near
future. In addition, several initiatives by the Government of India and major automobile
players in the Indian market is expected to make India a leader in the two-wheeler and four-
wheeler market in the world by 2020.

In this report I would comparatively analyse the top three market leader of the industry:

 TATA Motors LTD

 Maruti Suzuki India LTD
 Mahindra and Mahindra LTD

TATA Motors LTD:

Tata Motors ltd is an Indian multinational automotive manufacturing company headquartered

in Mumbai. Its products include passenger cars, trucks, van, coaches, buses, construction
equipment and military vehicles. Founded in 1945 by JRD TATA as manufacturer of
locomotives the company manufactured its first commercial vehicle in 1945 in a
collaboration with Daimler-Benz AG. which ended in 1969. Tata motors entered the
passenger vehicle market in 1991 with the launch of the Tata Sierra becoming the first Indian
manufacturer to achieve the capability of developing a competitive indigenous automobile.
The company is ranked 6th on the Fortune Global 500 list of the world's biggest corporations
as of 2020.

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Maruti Suzuki India LTD:

In 1982, Government of India entered into a joint venture with suzuki motor corporation of
Japan. Plant was established at Gurgaon in Haryana. Maruti Suzuki India Ltd is a publicly
listed automaker in India. It is a leading four-wheeler automobile manufacture in South Asia.
Maruti Suzuki had bought a big revolution in the automobile industry. It is one of oldest
company that expertise in the field of production cars. It has manufactured cars such as
Omni, Alto and Estilo. The total annual production capacity is about 22,50,000 units. it works
with a mission to provide a car for every individual, family, need, budget and way of life. . It
was ranked 25th on a list of top companies in India by Fortune India 500 in 2020.

Mahindra & Mahindra LTD

Mahindra & Mahindra Limited is an Indian multinational automotive manufacturing corporation

headquartered in Mumbai, Maharashtra, India. It was established in 1945 as Muhammad & Mahindra
and later renamed as Mahindra and Mahindra. It is one of the largest vehicle manufacturers by
production in India and the largest manufacturer of tractors in the world. It is a part of the Mahindra
Group, an Indian conglomerate. It was ranked 17th on a list of top companies in India by Fortune
India 500 in 2020. Its major competitors in the Indian market include Maruti Suzuki and Tata Motors.

VISION

Tata Motors Maruti Suzuki Mahindra & Mahindra

By FY 2024, we will become The leader in the Indian To be the most admired in

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the most aspiration Indian Automobile Industry, India
auto brand, consistently Creating Customer Delight
winning, by and Shareholders' Wealth; A
pride of India
Delivering superior financial Networking and partnership To be the most Successful in
returns India
Driving sustainable mobility Innovation and Creativity To be the most socially
solutions responsible special steel
manufacturer in India
Exceeding customer Openness and Learning
expectations, and
Creating a highly engaged
work force

MISSION

Tata Motors Maruti Suzuki Mahindra & Mahindra

We innovate mobility To provide a wide range To supply high quality
solutions with passion to of modern, high quality special steels to meet
enhance the quality of life. fuel efficient vehicles in growing demand and to
order to meet the need of contribute to customers'
different customer, both competitiveness
in domestic and export
markets.

BOARD OF DIRECTORS OF TATA MOTORS LTD

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BOARD OF DIRECTORS OF MARUTU SUZUKI LTD

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BOARD OF DIRECTORS OF MAHINDRA & MAHINDRA LTD

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CSR ACTIVITIES

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 Tata Motors Maruti Suzukui Mahindra & Mahindra
Health Tackling: Community development: KC Mahindra Education
Malnutrition water and sanitation and Trust
education
Education: Focus on Skill Development: Up Mahindra Pride School
secondary school students gradation of government
vocational and technical
training institutes and skill
enhancement in
automobile trade.
Employability: Training Road safety: Driving Nanhi Kali Project
youth in Automotive trades training and road safety
education.
Environment: Building Disaster Relief
green awareness
Rejuvenating 3 Municipal
Gardens in Mumbai
Lessening CO2 Emissions:
Developing Bijlee
Encouraging Art and
Culture

VARIETY OF PRODUCTS OF TATA MOTORS

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 VARIETY OF PRODUCTS OF MARUTI SUZUKI

VARIETY OF PRODUCTS OF MAHINDRA & MAHINDRA

BALANCE SHEET OF TATA MOTORS (in crores)

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BALANCE SHEET OF MARUTI SUZUKI (in crores)

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BALANCE SHEET OF MAHINDRA & MAHINDRA (in crores)

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SWOT ANALYSIS

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 STRENGTHS
Tata Motors Maruti Suzuki Mahindra & Mahindra
Tata Motors is one of the Maruti Suzuki is the largest Mahindra has been one of the
most established company in passenger car company in strongest brands in the Indian
automobile sector in India India, accounting for around automobile market
45% market share
Tata Motors has a wide & Over 12,000 people are Mahindra group give
extensive distribution and employed with Maruti employment to over 110,000
service network employees
Good market penetration in Good advertising, product Excellent branding and
the taxi & rental segment portfolio, self-competing advertising, and low after
brands sales service cost
Expert service professionals Largest distribution network Sturdy SUV’s good for
available of dealers and after sales Indian roads and off-road
service centres terrain
Many associations like Strong brand value and
Jaguar Land Rover, strong presence in the second
Hispaniola, Macro polo etc hand car market
increases Tata Motors'
international presence
Dedicated engineering and Having different revenue
R&D department streams like Maruti finance,
Maruti Insurance and Maruti
driving schools
More than 70,000 employees Over 700,000 units sold in
are present with Tata Motors India annually including
50,000 exports
Highly diversified product Maruti Suzuki launched
portfolio NEXA showrooms to cater to
its premium cars market
Strong brand legacy owing to The company has been
parent brand Tata recognized by several awards
in the automobile segment in
India

WEAKNESS
Tata Motors Maruti Suzuki Mahindra & Mahindra
Limited international Inability to penetrate into the Mahindra’s partnership with
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presence as compared to international market Renault did not live up to
international car international quality
manufacturers standards through their brand
Logan
Controversies like Singur Employee management,
plant for Nano etc hurt Tata strikes, worker wage
Motors problems have
affected Maruti's brand
image in the past

OPPORTUNITIES
Tata motors Maruti Suzuki Mahindra & Mahindra
Expanding automobile Developing hybrid cars and Developing hybrid cars and
market can be a boon fuel efficient cars for the fuel efficient cars for the
for Tata Motors future can be an opportunity future
for Maruti Suzuki

Increasing per capita income Maruti can target tapping Tapping emerging markets
and purchasing capability of emerging markets across the across the world and building
potential customer base world and building a global a global brand
brand
Leveraging customer Fast growing automobile Fast growing automobile
engagement experience to market and increased market
acquire new customers can purchasing power
be done by Tata Motors
Leveraging mergers and Growing in the market
acquisitions to acquire newer through electric car Reva
technology (controlling stake) and entry
into two-wheeler segments
Tata Motors can boost
business by augmenting the
distribution and service
network in various countries

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 THREATS
Tata Motors Maruti Suzuki Mahindra & Mahindra
Increasing fuel costs Government policies for the Government policies for the
automobile sector across the automobile sector across the
world world
Competition from other big Ever increasing fuel prices Ever increasing fuel prices
automobile giants means
reduced market share
for Tata Motors
Competitive products Intense competition from Intense competition from
offering same level features global automobile brands and global automobile brands
at a lesser price cheaper brands can
hurt Maruti Suzuki's business
Product innovations and Substitute modes of public Substitute modes of public
frugal engineering by transport like buses, metro transport like buses, metro
competitors trains etc trains etc

PESTLE ANALYSIS

POLITICAL FACTOR
Tata Motors

As Tata Motors ltd is working in auto fabricates, significantly in excess of dozen nations in
this manner it brings about savvy introduction itself in various sorts of world of politics and
political framework dangers. Results astute they need to confront various degrees of
defilement, organization and obstruction in various lawful of systems for contract
requirement, licensed innovation security, valuing guideline and compulsory representatives
benefits, mechanical wellbeing guidelines in buyer merchandise area. Tata Motors had
confronted political issues and needed to move the plant area of Nano, charged as individuals'
vehicle, the least expensive vehicle on the planet, the base model costing only 1 lakh. They
were offered unique motivations by Gujarat Govt. Brexit left a few issues of vulnerability
influencing offers of Jaguar Land Rover-a result of TATA engines and its backup.

Maruti Suzuki

Political factors that affect the sale and revenue of automobile companies like Maruti Suzuki
are rules and regulations formed by the government. The policies which are laid by the
government for the automobile sector need to be followed by Maruti Suzuki. Taxation and
labor laws, affect the overall revenue of the company if the taxes increase then the company
has to increase its product price, and there is also an increase in labor laws by the

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government. High skilled labor finds it easy to get a job in the automobile sector due to these
labor laws. According to the target market, the company manufactures small cars so that it
can target economically low-income consumers. The company needs to abide by the rules
and regulations while exporting or importing its counterparts from the international market.

Mahindra & Mahindra

Political factors impact the business strategy and its operations in the automotive industry.
There are a number of political factors such as government political framework stability,
government framed policies and guidelines in the automotive sector for all the companies.
Like in India, the Government is focused on driving voluntary old vehicle scrapping policy.
The government is also keen on spreading the E-vehicles market to curb emissions. Mahindra
& Mahindra has tied up with central Govt. and many states along with other firms to create
an Electric Vehicle boom in India. Even the recent 100% Foreign direct Investment
announcement in the automotive sector is a challenging threat for this firm. The govt.
initiatives such as Make in India can drive its sales with tax rebates and other associated
benefits. It is important to work in tandem with Government rules and set policies to get the
right opportunities in the right market.

ECONOMIC FACTOR

Tata motors

Tata Motors’ business is driven by several economic factors. TATA engines share 4 percent
responding to remote business CLSA's call to ''sell" the stock as cost concerns proceeded in a
powerless interest condition. Things appear to going from terrible to more regrettable for Tata
engines ltd as deals crosswise over worldwide market are diving, expanding capital costs and
overwhelming obligation alongside arrangement of rating downsize. While there was a
failure of Tata Nano, some of its other brands like Safari, Sumo, Hexa have all benefitted
Tata Motors.

Maruti Suzuki

The economy of a country affects the sales and revenue of an automobile company like
Maruti Suzuki. As the economy of India currently, is facing a downfall so the automobile
sector is facing an economic crisis. Maruti Suzuki is the leading automobile company in India
but due to the economic downfall, its sales decreased by 32.7 percent in August 2019. An

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increase in interest and inflation rate will result in a negative impact on the growth if the
company. The oil price is a major factor in determining the sale of the company, as the oil
prices are rising people are not willing to buy the cars and thus the sale decreases. The
manufacturing sector has grown by around 10 percent per annum in the last few years. But
due to the economic slowdown this year, the company has curtailed its manufacturing.

Mahindra & Mahindra

The economic factors such as increasing inflation, rising recession, income and employment
level play a major role in the sales of automobiles. The good economic conditions influence
the purchasing decision of consumers. Even the import-export duties, tariffs and taxation can
increase the selling price for automobiles. Mahindra & Mahindra need to plan its business in
sync with the macro and micro economic factors. The rising fuel prices, GST can affect the
demand for this vehicle’s manufacturer. In rural areas, factors such as lower household
income, low employment rate need to be considered while selling. As disposable income is
expected to increase post COVID-19, people will buy more personal vehicles. Even the sale
of tractors for this firm is expected to improve any time after the situation normalizes.

SOCIAL FACTOR

Tata Motors

Trust in brand TATA is a bit of leeway to Tata's influence. Tata Motors has constantly given
weight age in utilizing the neighbourhood populace making openings for work and
cooperative attitude among the general public. View of TATA vehicles extraordinarily in
traveller fragment is that of a modest vehicle Trade guild assumes a fundamental job in the
assembling segment in Indian car industry. TML is associated with altruism and supports in
excess of 300 NGO's.

Maruti Suzuki

Socially Maruti Suzuki has done a lot for the people, Maruti Suzuki believes in serving
enhanced customer requirements, and perceived social value. Maruti has set up many welfare
camps, took initiative for the education of the underprivileged, has adopted energy-saving
technologies, reduced water wastage, taken care of road safety, etc. Maruti Suzuki has set up
its driving schools to assure every person learns the right approach and to minimize the risk
of accidents. Maruti has always fulfilled and delivered the needs of common people. Due to

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the cricket world cup, IPL, etc, the country attracts tourism so there is a great opportunity for
a company like Maruti to increases its marketing and business. As Maruti has a strong brand
value it attracts people easily. To cater to the needs of the youth, Maruti has also launched
Maruti Genuine Accessories which extends stereo systems, carpets, body covers, and many
other car care products for its huge customer base.

Mahindra & Mahindra

There are many social factors which have an ability to change dynamics of purchasing
automobiles. Demographic factors such as age, gender, income level, location, employment
level, marital status etc. impacts the choices and lifestyle decisions. Working class living in
urban areas like cities prefer to have a social status and for that they tend to buy their own
personal vehicles. Even a big family prefers 4 wheelers rather than 2 wheelers which gives
them value for money. This firm has ventured into E-vehicles with low running costs which
has huge demand potential. There is a lot of opportunity to target different market segments
with different business and functional strategies. Due to fear of COVID-19 pandemic spread,
people started buying more cars as compared to travelling in public transportation. Mahindra
& Mahindra can gain a big market share by analyzing and operating in the market properly.

TECHNOLOGICAL FACTOR

Tata Motors

To receive new advances Tata Motors possesses TATA innovations ltd which aides
overhauling of structure and innovation of Tata engines. Tata Motors has been pushing for
electrical vehicles exceptionally in the class of business traveller vehicles (transports. The
more versatile the trade understandings are, the greater accomplishment and arrangement the
association will get. In like way, the political robustness in the huge markets of the states is
one of the gigantic parts. If India transforms into a state where there is political constancy
will be logically disposed to the securing of the latest vehicles. In various terms the more
made and calm a state will be, the better the lifestyle of the people will be and the more
chances of the incredible leeway of vehicles will be. Likewise, the assistance from the
organization for the things like eco free condition is something essential while chalking out
the game plans and assessing the accomplishment of the association.

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Maruti Suzuki

The automobile sector always needs to be updated in technologies to consider driving safety
needs and innovations in the model. The company invests a lot in research and development
to improve engine features. Maruti Suzuki is involved in the manufacturing of fuel-efficient
and small car engines. For its highest selling car Alto it launched a CNG kit. The company
applies next-generation KB series engine in its new hatchback car A-star. The company
developed the LPG/CNG/Hybrid system for the MPI engine to use as the alternate fuel
technology. The company has included a virtual design review to its Research and
development department to assure the virtual validation to reduce the cycle time and
development cost of manufacturing.

Mahindra & Mahindra

Technological factors are pivotal to focus upon for Mahindra & Mahindra in order to gain
competitive market share. The company is the pioneer for Electric Vehicles in India. This
auto company is actively pursuing the growth of the EV market. It has invested over Rs. 500
crores in its EV project under the new EV policy of the Government of Maharashtra. It is the
first auto company having its products well integrated onto a cloud-based technology
platform. It is also leveraging the latest technologies like IOT to automate its manufacturing.
These technological advancements help this company to track its processes and resources in
real time. It also has digitally enabled sensors DIGISENSE installed in all its vehicles
including passenger and commercial vehicles. It is also offering personalized solutions and
designer cars with new technology like the e3W and the Treo. It needs to continuously
upscale its technology and invest in research and development in order to compete with the
Global and national automobile manufacturing firms. This can boost its sales and market
share.

LEGAL FACTORS

Tata motors

Tata Motors, like an major company, is bound by several legal factors. The more versatile the
trade understandings are, the greater accomplishment and arrangement the association will
get. In like way, the political robustness in the noteworthy markets of the states is one of the
immense parts. If India transforms into a state where there is political trustworthiness will be

21
logically disposed to the obtaining of the latest vehicles. In various terms the more a state will
be, the better the lifestyle of the people will be and the more chances of the extraordinary
freedom of vehicles will be. What's more, the assistance from the organization for the things
like eco free condition is something crucial while chalking out the plans and assessing the
accomplishment of the association.

Maruti Suzuki

Maruti Suzuki has to follow the highest standards of corporate governance. All the legal laws
need to be followed by the company to take care of the safety of the consumers. The
company has evolved a legal compliance scheduling and management software by which
specific tasks are given to every individual. The customers can contact any time for their
queries to the secretarial and legal department. Maruti Suzuki is involved in international
trade, so it has to follow the trade laws of every country involved. Increased level of
regulations and privatization of the automobile sector also affects the sale of Maruti Suzuki.

Mahindra & Mahindra

Legal factors in the automobile sector are really stringent as it concerns the safety and
security of passengers, customer data privacy, environmental laws, patents, labor laws in the
manufacturing plants etc. work environment, safety of employees, wage policies etc.
Mahindra & Mahindra need to follow all relevant laws to build market trust and loyalty. It
needs to focus on its product failures during the testing phase properly to avoid any lawsuits
after delivery. The safety laws need to be adhered to while designing and rolling out the
vehicle in the market. This company is also manufacturing BS6 gasoline engines which is
less polluting keeping in mind the environmental laws. This company can increase its market
share by abiding to all legal practices in its business operations.

ENVIRONMENTAL FACTOR

Tata Motors

Tata Motors endeavours to be an eco-accommodating organization and backs numerous

crusades like Earth and clear earth. The organization is advancing electric vehicles and
furthermore the organization is seeking after the conceivable outcomes of eco-friendly
mixture autos. The particular natural change attributes are basically the open entryway for the
Tata Motors Company.

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Maruti Suzuki

The automobile industry follows international standards of emission and safety. There is a
growing concern about the pollution caused by automobiles. Maruti Suzuki enables a
continuous process of promoting recyclable and reusable car parts. Maruti is also practicing
the 3 R model - Reuse, Reduce, Recycle for a long time.

Mahindra & Mahindra

The environmental factors are really important for Mahindra & Mahindra to make a
sustainable business model in the long term. The climate change and focus on reducing
vehicular pollution which is adding up to global warming is crucial to be considered. This
firm is already making many eco-friendly business operations to drive a positive impact on
the environment. Its focus on reducing carbon footprints is immense in its business strategy.
It has been ranked as one of the top 100 most sustainably managed companies.

PORTERS ANALYSIS

Tata motors Maruti Suzuki Mahindra &

Mahindra
Bargaining power If the buyers have If the threat of  If suppliers have
of buyers  strong bargaining substitute is high strong bargaining
power then they then Cars Electric power then they will
usually tend to drive has to either extract higher price
price down thus continuously invest from the Mahindra
limiting the potential into R&D or it risks Loans.
of the Daewoo Tata losing out to
to earn sustainable disruptors in the
profits. industry.
Rivalry among If competition is  If suppliers have  If competition is
existing players  intense then it strong bargaining intense then it
becomes difficult for power then they will becomes difficult for
existing players such extract higher price existing players such
as Daewoo Tata to from the Cars as Mahindra Loans to
earn sustainable Electric. earn sustainable
profits. profits.
Bargaining power  If suppliers have If competition is If suppliers have
of suppliers strong bargaining intense then it strong bargaining
power then they will becomes difficult for power then they will
extract higher price existing players such extract higher price
from the Daewoo as Cars Electric to from the Mahindra
Tata. earn sustainable Loans.
profits.
 Threat of new if there is strong  if there is strong If the threat of

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 entrants threat of new entrants threat of new entrants substitute is high
then current players then current players then Mahindra Loans
will be willing to will be willing to has to either
earn less profits to earn less profits to continuously invest
reduce the threats. reduce the threats. into R&D or it risks
losing out to
disruptors in the
industry.
Threat of substitute  If the threat of  If the buyers have  If the buyers have
products and substitute is high strong bargaining strong bargaining
services then Daewoo Tata power then they power then they
has to either usually tend to drive usually tend to drive
continuously invest price down thus price down thus
into R&D or it risks limiting the potential limiting the potential
losing out to of the Cars Electric of the Mahindra
disruptors in the to earn sustainable Loans to earn
industry. profits. sustainable profits.

CONCLUSION

Indian automobile has a lot of scope for both two wheelers and four wheelers due to
development in infrastructure of the country

According to Indian statistical organization the per capita income is increasing and national
income at the rate of 36% which shows potential to buy vehicle in auto vehicle in auto
industry . The growth rate of Indian automobile is so fast that by 2026 Indian industry will be
would 7 largest manufacturing in all sections

The Indian auto markets is still untapped the majority of the people in country don’t own a
four wheeler and all the major auto companies are trying to increase their sales by several
moves .

By analyzing the current trend of Indian economy and automobile industry we can say that
there is lot of scope for growth .

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