Two-Wheeler Market Insights and Consumer Behaviour Study

3
DECLARATION
I hereby declare that the project work presented in this
project report entitled
‘ANALYTICAL STUDY OF TWO-WHEELER MARKET,
CONSUMER BEHAVIOUR AND MARKETING STRATEGIES
(SAMPLE SPACE: - PIMPRI-CHINCHWAD)’
is an outcome of my efforts involved in project work,
under the guidance of Mrs. M. L. Khanapur and submitted the
same as an original for the award of
BACHELOR OF BUSINESS
ADMINISTRATION
(B.B.A.)
I also declare that this research report or thereof is for
academic purpose only and has not been submitted by me for a
degree of any university.
DATE: 06-04-2007
PLACE: Pimpri, Pune – 18 Viraj. R. Hegde
(Researcher)

7
PREFACE
“The vision must be followed by the venture. It is
not enough to stare up the steps - we must step up the
stairs.”
- Vance Havne
Keeping the above lines in mind a sincere attempt has
been made in this Project Report to understand some unique
aspects of Indian Two-Wheeler Market.
We see and also use two wheelers in our day to day life.
But tend to overlook many aspects related to the two wheelers.
When the word, ‘two-wheeler’ is uttered people usually tend to
think about the technical aspects. But there are many other aspects
that play an important role to keep a particular product working in
the market.
In this project report I have tried my best to highlight
the marketing aspects related to the two wheelers. Earnest efforts
have been made to prove the importance of marketing strategies
and related factors in two-wheeler market. The project is divided
into four major sections. The first mainly concentrates on the
Indian Two-Wheeler Market which is backed by relevant data
collected from the sample space surveys. The second consists of
Consumer Behavior survey carried on in the sample space. The
third section mainly concentrates on the Marketing Strategies
used. The fourth section is dedicated to Problems and
Suggestions which may help to solve them.
The Indian Two-Wheeler market is one of the biggest
markets in the world. It is well known for its dynamic nature. It is

8
due to this dynamism that the Two-Wheeler Market in India has
undergone tremendous development in recent times. It’s a matter
of pride to be a part of this market for anyone. This project is one
of my initial steps to understand the developing Indian Two-
Wheeler Market. There’s a long way to go as the quest never ends.
PLACE: Pimpri, Pune-18 Viraj. R. Hegde
DATE: 06-04-2007

9
ACKNOWLEDGEMENT
I would like to express my deep sense of gratitude to
Mrs. M. L. Khanapur, Pad. Dr. D. Y. Patil ACS College, our
Project Guide, for her valuable guidance, under whom this project
has been prepared.
I am very indebted to all the respondents of my study
for having spared their valuable time amidst busy schedules to be
with us and give valuable information.
I take this opportunity to express sincere and hearty
gratitude to, Prof. J. A. Jadhav, Principal, Pad Dr. D. Y. Patil
A.C.S College, Pimpri, for providing us necessary infrastructure
and facilities to proceed with the project.
I am thankful to my parents for providing necessary
fund and their valuable guidance for my project work.
I even thank Mr. S. S. Shingwekar, Manager – Human
Resource, and Miss. Gouri Deshmukh, Officer – Human
Resource, Sai Service Station Ltd., for their valuable guidance
and co-operation in making this project a success.
Thank you.

10
INDEX
CHAPTERS TOPICS PAGE
NUMBERS
1 INTRODUCTION 1-6
2 ABOUT ‘SAI SERVICE STATION LTD’ 7-11
3 OBJECTIVES AND SCOPE OF THE STUDY 12-13
4 IDENTIFICATION OF PROBLEM AND
HYPOTHESIS
14-17
5 RESEARCH METHODOLOGY 18-23
6 DATA REPRESENTATION
PART-1
Two-Wheeler Market Insight 24-60
7
DATA REPRESENTATION
PART-2
Consumer Behavior and Two-Wheeler Market
Segmentation
61-85
8
DATA REPRESENTATION
PART-3
Two-Wheeler Marketing
86-95
9 SUGGESTIONS FOR PROBLEM SOLVING 96-98
10 CONCLUSIONS 99-104
ANNEXURE 105-118
BIBLIOGRAPHY 119
QUESTIONNAIRE 120

11
INTRODUCTION
• CONCEPT OF RESEARCH
• AREA OF REASEARCH
• REASONS FOR SELECTION
• IMPORTANCE OF THE PROJECT

12
CONCEPT OF THE RESEARCH
Marketing today has become an important entity of
every organization. Be it small or large, be it profit motivated or
service motivated, an organization has to market its product or
services. Marketing is a tool which provides efficient strategies to
the organization in order to accomplish their objectives such as,
marking the presence of an organization in the market, making the
people aware of the product, attract and retain the customers,
compete the market etc. Marketing is thus rightly defined as
“A total system of interacting business activities
designed to plan, price, promote and distribute want satisfying
products and services to the present and potential customers”.
----- W. J. Stanton
Services today are playing an important role in
marketing the products. Consumers give ample priority for after
sales services. So, strengthening the services is very important for
an organization. Liberalization, privatization and globalization
(LPG) have exposed various organizations including the service
sector to the challenges of competition, service quality, cost and
competitive environment. Some of those unable to cope up with
the changes may have to face the consequences of survival of the
fittest.
Most service marketing involves some goods. Hence it
can be said that a product is very closely related to service. A
product or service (in some cases) itself generates the need for
service. The facts show that more than half of the consumer
expenditure is for services

13
In the total Indian economy, the share of service sector increased
from 28.5 percent in 1950-51 to 41 percent in 1993-94 and 51
percent in 1998-99.
1950-51
1960-61
1970-71
1980-81
1990-91
2000-2001
28.5 30 34 38 40
51
0
10
20
30
40
50
60
Percent
Years
SERVICE GROWTH TREND IN INDIA
AREA OF RESEARCH

14
The service sector has grown to a large extent that it
can be termed as a mammoth among all the economic sectors.
Each and every business has to provide services to its customer in
some or the other way. Following is a partial list of types of
services.
• Transportation Services
• Public Utility Services
• Trading Services
• Financial and Insurance Services
• Entertainment Services
• Hospitality Services
• Marketing Related Services
• After sales services etc.
In all of these services After Sales Services are very
prominent. After Sales Services play an important role in
automobile sector. Especially in terms of two wheelers as India has
a very strong two-wheeler market. An analytical study of two-
wheeler market can be easily performed with the help of an
automobile related organization which, both sells the Products
and also provides After Sales Services.
The whole two-wheeler market of India cannot be
studied in a short span. Thus, a sample space is to be selected.
Pune is the biking capital of India and there is no better place other
than Pune to know about the current trends & related factors of
two-wheeler market. Pimpri-Chinchwad area in Pune is termed to
be a Detroit, mainly because of its industrial background. Major
automobile players locate this area as of economical importance.
Hence PCMC selected as a sample space can give efficient
knowledge about the two-wheeler trends, situations & related
factors.
REASONS FOR SELECTION

15
Two-wheeler market is the most dynamic market. This
sector has made itself prominent due to constant changes and
developments taking place here. It attracts most of consumers from
the society. The reasons behind this are its products. Two wheelers
are such products that have become a necessity in today’s life.
Also, the consumer wants play a very important role in
determining the type of vehicle to be launched.
Reasons for selecting two-wheeler market for this research can be
summarized as follows:
Reasons Relative Conclusions
There is constant research done
on the market and consumer
wants than any other sector.
The consumers are considered
as the king.
There is a severe competition in
the market.
Many varieties of marketing
strategies are used.
A fascinating sector Products of this sector are the
most liked and awaited by
consumers.
Technology meets marketing The only prominent sector
where technology can be easily
related to marketing.
Thus, an analytical study of two-wheeler market can
reveal many facts and secrets of marketing and also give a
practical experience on applications of these strategies.
IMPORTANCE OF THE PROJECT

16
• Academic Importance: -
This project is very important from academic point of
view. It provides a lifetime opportunity to get ourselves
introduced to practical situations. The theory learnt in lectures
can be applied practically in order to reveal various unknown
situations. Also, the strategies learnt can be applied for the
purpose of data collection and solving the problems. It also
provides ample opportunities to prove oneself.
• Miscellaneous Importance: -
The project report provides ample data that even a
layman can get closer to two-wheeler market. It takes into
consideration various factors such as consumer behavior,
customer satisfaction, marketing strategies and much more. It
presents the situations and trends evident in the current two-
wheeler market which is very useful from marketing point of
view. This project is supported by earnest efforts on surveys that
provide factuality. Marketing situations which may be unknown
have also been highlighted through this project.

17
ABOUT ‘SAI SERVICE STATION LTD’

18
Sai Service Station Ltd. was incorporated on 9th August 1985 as
a Private Limited company by Mr. Sridhar Kalmadi and Mr.
Mukesh Kalmadi. By virtue of its turnover it became a deemed
Public Limited company in 1988. Sai Service Station Ltd. was
formally converted into a Public Limited company in 1994 with a
Public Issue of Equity shares aggregating to about Rs.20 Crores.
The company is listed on Bombay and Pune Stock Exchanges.
The Company was appointed as a dealer for Maruti Udyog Ltd. in
1985 and for Bajaj Auto Ltd. in 1986. Sai Service controls a large
market share for these vehicles in the areas it represents. Sai
Service was also appointed a dealer for Mahindra & Mahindra
Jeeps in 1994.
Sai Service is a professionally managed Multiproduct,
Multilocational company with ISO 9002 certification. It has set
up service stations equipped with most modern computerized
equipment and manned by experienced and qualified automobile
engineers. The service stations are located in Mumbai, Pune, Goa
and Kolhapur.
The company has also diversified into related activities like Car
Rentals and Quality Used Car Sales.
SAI SERVICE STATION LIMITED

19
Regd. Office: Mumbai Pune Road, Phugewadi, Pune 411 012
Ph. No. (020) 3068 1400 / 02 Fax (020) 30681401
UNAUDITED FINANCIAL RESULTS (PROVISIONAL) FOR THE
QUARTER ENDED 30TH
SEPTEMBER, 2006
Quarter ended Half Year ended
Rs.
Sr. Particulars
Year
ended
No.
30-09-
2006
30-09-
2005
30-09-
2006
30-09-
2005
31-3-
2006
(Un-
audited)
(Un-
audited)
(Un-
audited)
(Un-
audited) (Audited)
1
Net Sales / Income from
Operations 19877.59 17163.45 36694.75 30284.43 72451.14
2 Other Income 16.46 18.35 43.57 32.69 96.73
3 Total Expenditure 19120.19 16774.93 35536.55 29628.45 70362.58
a. (Increase) / decrease (920.86) (2587.75) (1177.99) (3172.00) (1514.20)
in stock-in-trade
b. Consumption of Materials 19380.59 18306.55 34415.19 30748.18 67486.82
c. Staff Cost 593.87 431.11 1094.25 844.78 1772.75
d. Other Expenditure 580.85 625.02 1205.09 1187.50 2617.21
e. Loss on sale of investment --- --- --- --- 703.16
4 Interest 89.10 100.18 198.20 200.56 438.67
5 Depreciation 124.88 96.56 223.49 178.82 339.83
6
Profit before Extraordinary
Item & Tax 559.90 210.12 780.09 309.28 703.64
7 Provision for Taxation
a) Current 232.10 80.07 300.10 113.28 503.32
b) Deferred (31.44) (9.54) (37.54) (9.54) (163.57)
c) Earlier Years (Net) 0.00 0.00 0.00 0.00 27.27
d) F. B. T. 5.04 6.53 14.15 12.07 39.00
9 Net Profit 291.31 133.06 428.30 193.47 297.62
10 Paid-up Equity Share Capital 407.30 407.30 407.30 407.30 407.30
(Face Value Rs. 10/-)
11 Reserve excluding --- --- --- --- 3652.50
Revaluation Reserve
12 Earning per Share (Rs) 7.16 3.27 10.52 4.75 7.31
Basic & Diluted (Not
Annualized)
13 Aggregate of
Non-Promoter Shareholding
--Number of Shares 1254111 1253711 1254111 1253711 1247211
--Percentage of Shareholding 30.79 30.78 30.79 30.78 30.62

20
(1) The above results, as reviewed by the Audit Committee have been taken on record
by the Board of Directors at its meeting held on 27th October, 2006.
(2) Previous year / quarter's figures have been regrouped / reclassified wherever
necessary.
(3) The Company operates only in 2/3/4 wheeler segment, hence no separate
segmentwise reporting is given.
(4) The number of Investors Complaints pending at the beginning of the quarter were
NIL, received during the quarter NIL, resolved during the quarter NIL and balance
NIL at the end of the quarter.
For Sai Service Station Limited
Sd/-
Place: Pune Mukesh.S.Kalmadi
Date: 27th
October 2006 Jt. Managing Director
Mumbai
Andheri (Maruti/Bajaj/Mahindra)
Sai Service Agency (Bombay) Ltd.
Western Express Highway
Andheri (East)
Mumbai 400069
Tel: 8380055
Mumbai
Lower Parel (Maruti)
Sai Service Station Ltd.
Phoenix Mill Compound
Dainik Shivner Marg
Gandhi Nagar, Worli
Mumbai 400013

22
OBJECTIVES AND SCOPE OF THE STUDY
• OBJECTIVES
• SCOPE
OBJECTIVES

23
• To study the trends, situations, concepts and related
factors in the present two-wheeler market.
• To study consumer behavior and strategies used in two-
wheeler marketing.
• To practically apply marketing strategies.
• To detect problems.
• To study the problems and provide effective suggestions.
• Formulate proper conclusions.
SCOPE
• Indian two-wheeler market
• Consumer behavior with respect to the two wheelers
• Marketing strategies widely used in two-wheeler
marketing.

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IDENTIFICATION OF PROBLEM AND
HYPOTHESIS
• PROBLEM DETECTION
• UNDERSTANDING THE PROBLEM
• HYPOTHESIS
PROBLEM DETECTION

25
Following problems related to consumer behavior and
marketing were detected during the research
• Consumers’ technical know how about the two-wheeler.
• Availability of demo of all two-wheelers
• Availability of spare parts
• Marketing on limited basis
UNDERSTANDING THE PROBLEM
• Consumers’ technical know how.
Indian two-wheeler manufacturers are no way behind
in this dynamic phase where technology plays a very important
role. Some effective and proven technologies in two wheelers
are as follows: -
1. DTS-i:- ‘Digital Twin Spark Ignition’ by ‘Bajaj’ is
being installed on almost all of its bike models. The major
purpose of this technology is to give a good acceleration,
timing, pick up, fuel efficiency and many more
refinements.
2. YTPS:- ‘Yamaha Throttle Positioning System’. This
technology detects the rider’s way of handling the
accelerator and adds further refinement in petrol flow
through the carburetor.
3. Quantum Core Engine:- A new refined engine as said
by Hero Honda.

26
4. FI:- This is a total digital system where sophisticated
electronics control the injection of fuel on basis of sensors
attached on various parts of the bike. It improves the
efficiency of the bike and feedback given to the rider.
5. ExhausTEC:- Again a new technology by ‘Bajaj’. This
is nothing but ‘Exhaust Torque Expansion Chamber’.
This facilitates riding the bike at lower speeds in higher
gears. Thus knocking problem gets reduced.
These technologies are a major USP of the products. Very less
consumers know the functions of these technologies and thus
don’t take them into consideration during buying.
All the dealers of the two-wheeler don’t tend to give the
customer an opportunity to test ride the vehicle he likes. Also
most of the times only certain vehicle of a particular brand has
test riding. Thus there is a lack of Product Preview Support in
the two-wheeler market. Fuel costs are a major reason predicted
for this. Dealers don’t want to incur extra costs.
Local brands are always ready with the spare parts of
their bikes. But non local brands do have a problem with timely
supply of spare parts. Also, sometimes dealers fail to establish
effective communication with the manufacturers.
Indian bikes are being exported to other nations to a
good extent. But the manufacturers are not utilizing their whole
strength. The exports can be drastically increased. The

27
manufacturers are not concentrating on marketing their products
abroad to their peak extent. This is creating the barrier of
limited marketing.
• Perfect Consumer Satisfaction: -
The concept of perfect consumer satisfaction is
practically impossible. But it is possible to increase its
percentage in the present market. The percentage of perfect
consumer satisfaction is very low in Indian two-wheeler market.
The consumer needs are just partially satisfied. Indian
commuters have not yet been introduced to refined biking.
HYPOTHESIS
• Manufacturers adopt a holistic approach for marketing their
products.
• Good communication doesn’t exist between the consumers
and the two-wheeler manufacturers.

28
RESEARCH METHODOLOGY
• METHODS OF DATA COLLECTION
• SAMPLE SPACE METHOD
• FIELD WORK
• LIMITATIONS OF THE STUDY

29
METHODS OF DATA COLLECTION
1. Primary data sources: -
These are the sources that provide first hand
information. These also help in practical examinations of the cases.
Following are the methods by which data was collected in this
project.
• Face to face interactions: -
In this project it was very important to know the
characteristics of the consumers in Pimpri-Chinchwad. No other
methods other than face to face communication would prove
best in this job. Also, this method was very useful during the
visits to various two-wheeler showrooms in Pimpri-Chinchwad.
The officials could be easily convinced for provisions of
important data.
• Telephonic conversations: -
This type of conversations mainly proved efficient
during permissions. Also, information that seem to be minor but
are of utmost importance could be immediately obtained.
• Questionnaire: -
The questionnaire proves to be an unmatched method of
data collection. The practicality that it provides is of great
importance. Consumers & officials were requested to answer
the questionnaire.

30
2. Secondary data sources: -
These sources are not first hand sources of data. They
are secondary in nature. But these data prove very helpful as
they give us a pool of related information. Following are the
methods by which data was collected in this project: -
• Books: -
Books on marketing strategies provided a very good
insight for this project. They also helped in detecting various
problems and studying them.
• Magazines and newspapers: -
Magazines on automobile play a very important role
today. They have there own testing labs. And they test the
vehicles for the consumers and give proper verdict. Hence these
magazines have given ample information for this project. Also,
newspapers gave an insight to daily happenings about the
automobile industries.
• Pamphlets: -
All automobile showrooms present their products on the
pamphlets. These pamphlets proved to an important document,
as they contain various data of the product that help in building
appropriate categories.
• Internet: -
Internet has made this world a global village. This
project would be incomplete without the information from the
internet.

31
SAMPLE SPACE METHOD
Bogardus defines sampling as “selecting certain
percentage of a group items according to predetermined plan”.
The advantages of this method are: -
• A subject can be deeply studied as it reduces pressure on the
researcher.
• Collection of information becomes easy.
• It is not time consuming.
• It gives a chance to the researcher for personal interaction.
Indian two-wheeler market is a very large market. It’s
very difficult to study such big market in a short span. Hence in
this project Pimpri - Chinchwad area of Pune has been selected as
a sample space.

32
FIELD WORK
A field work is nothing but a part of a research in which
researcher faces practical situations. He is given a chance of direct
interaction.
Field work has played an important role in this project.
In fact, the validity of the project depends on the surveys and
questionnaire during the field work.
• In relation to consumers: -
Questionnaire method was adopted in order to interact
with the consumers. A collective response from the various
classes of the consumers was obtained during the survey.
• In relation to problems: -
Being in touch with consumers and various showrooms
during the survey, problems could be easily detected. It would be
difficult to detect problems without field work.
• In relation to personal experience: -
It was a great experience to face the practical situations
and face problems so closely like never before. This practical
experience is sure to be of great help in future.
The field work for this project was completed between,
Date: - 26th
February, 2007 to 5th
March, 2007.

33
LIMITATIONS OF PROJECT
Limitations can be defined as constraints which act as a
retarding force for the perfection of the project. Researchers have
to face various limitations during their research. This project is
also not an exception.
The limitations of this project are: -
• Individual work: -
This project is based on the survey and data collected by
a single individual. Though avoided a lot, there may be
possibilities of bias. A group work involves a greater discussion
and more collected data, which makes it comparatively away
from bias.
• Sample space method: -
Sample space method has proved its efficiency in
various fields. But it also has some drawbacks. This method
considers a micro environment and generalizes the results for
the macro environment. This may give false result some times.
Earnest efforts have been made in this project to avoid this.
• Questionnaire method: -
Questionnaire method plays a very important role in
validating the project. But attaching a number of questionnaires
in this project report is not possible. It may spoil the
presentation.
• Lack of funds: -
Availability of more funds could increase the
perfection of this project by use of some more efficient tools.

34
DATA REPRESENTATION
PART-1
Two-Wheeler Market Insight
• EVOLUTION OF INDIAN TWO-WHEELER
MARKET
• CURRENT SITUATIONS
• A GROWTH PERSPECTIVE
• TWO-WHEELER SEGMENTATION BASED ON
TYPES
• TWO-WHEELER SEGMENTATION BASED ON
CAPACITY
• EXISTING PLAYERS
• SAMPLE SPACE INSIGHT

35
EVOLUTION OF INDIAN TWO-WHEELER MARKET
The two-wheeler industry (henceforth TWI) in India
has been in existence since 1955. It consists of three segments viz.,
scooters, motorcycles, and mopeds. The increase in sales volume
of this industry is proof of its high growth. In 1971, sales were
around 0.1 million units per annum. But by 1998, this figure had
risen to 3 million units per annum. Similarly, capacities of
production have also increased from about 0.2 million units of
annual capacity in the seventies to more than 4 million units in the
late nineties. The TWI in India began operations within the
framework of the national industrial policy as espoused by the
Industrial Policy Resolution of 1956. This resolution divided the
entire industrial sector into three groups, of which one contained
industries whose development was the exclusive responsibility of
the State, another included those industries in which both the State
and the private sector could participate and the last set of industries
that could be developed exclusively under private initiative within
the guidelines and objectives laid out by the Five Year Plans
(CMIE, 1990). Private investment was canalized and regulated
through the extensive use of licensing giving the State
comprehensive control over the direction and pattern of
investment. Entry of firms, capacity expansion, choice of product
and capacity mix and technology, were all effectively controlled by
the State in a bid to prevent the concentration of economic power.
However due to lapses in the system, fresh policies were brought
in at the end of the sixties. These consisted of MRTP of 1969 and
FERA of 1973, which were aimed at regulating monopoly and
foreign investment respectively. Firms that came under the
purview of these Acts were allowed to invest only in a select set of
industries. This net of controls on the economy in the seventies
caused several firms to a) operate below the minimum scale of
efficiency (henceforth MES), b) under-utilize capacity and, c) use
outdated technology. While operation below MES resulted from

36
the fact that several incentives were given to smaller firms, the
capacity under-utilization was the result of I) the capacity mix
being determined independent of the market demand, ii) the policy
of distributing imports based on capacity, causing firms to expand
beyond levels determined by demand so as to be eligible for more
imports. Use of outdated technology resulted from the restrictions
placed on import of technology through the provisions of FERA.
Recognition of the deleterious effects of these policies led to the
initiation of reforms in 1975 which took on a more pronounced
shape and acquired wider scope under the New Economic Policy
(NEP) in 1985. As part of these reforms, several groups of
industries were de-licensed and ‘broad banding’ was permitted in
select industries. Controls over capacity expansion were relaxed
through the specification of the MES of production for several
industries. Foreign investment was allowed in select industries and
norms under the MRTP Act were relaxed. These reforms led to a
rise in the trend rate of growth of real GDP from 3.7% in the
seventies to 5.4% in the eighties. However, the major set of
reforms came in 1991 in response to a series of macroeconomic
crises that hit the Indian economy in 1990-91. Several industries
were deregulated, the Indian rupee was devalued and made
convertible on the current account and tariffs replaced quantitative
restrictions in the area of trade. The initiation of reforms led to a
drop in the growth of real GDP between 1990 – 1992, but this
averaged at about 5.5% per annum after 1992. The decline in GDP
in the years after reforms was the outcome of devaluation and the
contractionary fiscal and monetary policies taken in 1991 to
address the foreign exchange crisis. Thus, the Industrial Policy in
India moved from a position of regulation and tight control in the
sixties and seventies, to a more liberalized one in the eighties and
nineties. The two-wheeler industry in India has to a great extent
been shaped by the evolution of the industrial policy of the
country. Regulatory policies like FERA and MRTP caused the
growth of some segments in the industry like motorcycles to
stagnate. These were later able to grow (both in terms of overall

37
sales volumes and number of players) once foreign investments
were allowed in 1981. The reforms in the eighties like ‘broad
banding’ caused the entry of several new firms and products which
caused the existing technologically outdated products to lose sales
volume and/or exit the market. Finally, with liberalization in the
nineties, the industry witnessed a proliferation in brands. A
description of the evolution of the two-wheeler industry in India is
usefully split up into four ten-year periods. This division traces
significant changes in economic policy making. The first time-
period, 1960-1969, was one during which the growth of the two-
wheeler industry was fostered through means like permitting
foreign collaborations and phasing out of non-manufacturing firms
in the industry. The period 1970-1980 saw state controls, through
the use of the licensing system and certain regulatory acts over the
economy, at their peak. During 1981-1990 significant reforms
were initiated in the country. The final time-period covers the
period 1991-1999 during which the reform process was deepened.
These reforms encompassed several areas like finance, trade, tax,
industrial policy etc.
d) 1960 – 1969
The automobile industry being classified as one of importance
under the Industrial Policy Resolution of 1948 was therefore
controlled and regulated by the Government. In order to encourage
manufacturing, besides restricting import of complete vehicles,
automobile assembler firms were phased out by 1952 (Tariff
Commission, 1968), and only manufacturing firms allowed to
continue. Production of automobiles was licensed, which meant
that a firm required a licensing approval in order to open a plant. It
also meant that a firm’s capacity of production was determined by
the Government. During this period, collaborations with foreign
firms were encouraged.

39
Table above illustrates the fact that most firms existing
in this period had some form of collaboration with foreign firms. It
also gives the details of the various firms that existed in the
industry during this time period and the product/s they
manufactured.
b) 1970 – 1980
This was a period during which the overall growth rate of the two-
wheeler industry was high (around 15% per annum). Furthermore,
the levels of restriction and control over the industry were also
high. The former was the result of the steep oil price hikes in 1974
following which two-wheelers became popular modes of personal
transport because they offered higher fuel- efficiency over
cars/jeeps. On the other hand, the introduction of regulatory
polices such as MRTP and FERA resulted in a controlled industry.
The impact of MRTP was limited as it affected only large firms
like Bajaj Auto Ltd. Whose growth rates were curbed as they came
under the purview of this Act. However, FERA had a more far-
reaching effect as it caused foreign investment in India to be
restricted. In the motorcycle segment FERA caused technological
stagnation, as a consequence of which, neither new products nor
firms entered the market since this segment depended almost
entirely on foreign collaborations for technology. The scooter and
moped segments on the other hand were technologically more self-
sufficient and thus there were two new entrants in the scooter
segment and three in the moped segment.
c) 1981 – 1990
The technological backwardness of the Indian two-wheeler
industry was one of the reasons for the initiation of reforms in
1981. Foreign collaborations were allowed for all two-wheelers up
to an engine capacity of 100 cc. This prompted a spate of new
entries into the industry. The majority of which entered the
motorcycle segment, bringing with them new technology that
resulted in more efficient production processes and products. The
variety in products available also improved after ‘broad banding’
was allowed in the industry in 1985 as a part of NEP. This,

40
coupled with the announcement of the MES of production for the
two- wheeler industry, gave firms the flexibility to choose an
optimal product and capacity mix which could better incorporate
market demand into their production strategy and thereby improve
their capacity utilization and efficiency. These reforms had two
major effects on the industry: First, licensed capacities went up to
1.1 million units per annum overshooting the 0.675 million units
per annum target set in the Sixth Plan. Second, several existing but
weaker players died out giving way to new entrants and superior
products.
d) 1991 – 1999
The reforms that began in the late seventies underwent their most
significant change in 1991 through the liberalization of the
economy. The two-wheeler industry was completely deregulated.
In the area of trade, several reforms were introduced with the goal
of making Indian exports competitive. The two-wheeler industry
in the nineties was characterized by a) an increase in the number of
brands available in the market which caused firms to compete on
the basis of product features and b) increase in sales volumes in the
motorcycle segment vis-à-vis the scooter segment reversing the
traditional trend.

41
CURRENT SITUATIONS
The above figures clearly show that the two-wheeler
productions are reaching skies when compared to other segments.
The automobile industry in general and two-wheeler
industry in particular has shown a tremendous growth over the
recent years. According to the Society of Indian Automobile
Manufactures (SIAM) the industry has grown by 16% in the year
2003/2004.
Two-Wheeler segment as a whole during the year 2004/05 grew by
over 15%. This growth has been due to the Government's initiative
on rural roads and better connectivity with major towns and cities,
improved agricultural performance, upward trend of purchasing
power in the hands of rural people. The two-wheeler industry was
able to achieve the record performance of crossing 6 million two
wheelers with exact sales standing at 6,208,860 during the year
2004-05. The northward trend of growth among the two-wheelers
is set to continue in the years ahead. A brief input about the growth

42
of various segment of two-wheelers with the statistics from their
leading manufactures are as follows.
Scooters: -
2001-02 2002-03 2003-04 2004-05 2005-06
937506 848434 935279 987498 1020013
Though the metal bodied geared scooters have fallen out of favor
of the Indian two-wheeler user their upward trend in growth has
been due to rise in the sales of Scooterettess and Motor Scooters.
Bajaj Auto has been able to sell 152,936 units in the year
2004/2005 of two wheelers which don't include motorcycles. They
have shown a negative trend in the two-wheeler segment other than
the motorcycles. This goes on to show that Bajaj Auto has lost its
supremacy in the Scooter and moped segment as they have shifted
focus to motorcycles.
Motorcycles
2001-02 2002-03 2003-04 2004-05 2005-06
2906323 3876175 4355168 5193894 6201214
Motorcycles have become the most preferred choice among all
two-wheeler users. They account for nearly 80% of the total two-
wheeler sales in the country. This trend is set to continue as more
and more models of this hot set of two wheelers enter the market.
Bajaj Auto one of the largest manufactures of two wheelers in the
country has managed to sell about 1,449,710 units of motorcycle in
the year 2004/2005. Hero Honda which claims to be the largest
manufacturer of two-wheeler in the world was able to sell 2.62

43
million motorcycles during the year 2005/2005. The company also
accounts for half the market in the motorcycle segment.
Mopeds: -
2001-02 2002-03 2003-04 2004-05 2005-06
427498 351612 332294 348437 379574
Mopeds which were once the entry level options in the two-
wheeler, have been replaced by entry level or price category bikes
which provide all the comfort and advantages of a motorcycle but
at an affordable price. Thus, it has not come as a surprise that
mopeds have shown a negative growth over the recent years. TVS
Company one of the pioneers of mopeds manufactures of India
was able to sell about 2.90 lakh of mopeds during 2005/2006.
This trend is supposed to continue in the days to
come, as the motorcycles race ahead other two-wheelers will
find it difficult keep up with the pace of their growth.

44
A GROWTH PERSPECTIVE
The composition of the two-wheeler industry has witnessed sea
changes in the post-reform period. In 1991, the share of scooters
was about 50 per cent of the total 2-wheeler demand in the Indian
market. Motorcycle and moped had been experiencing almost
equal level of shares in the total number of two-wheelers. In 2003-
04, the share of motorcycles increased to 78 per cent of the total
two-wheelers while the shares of scooters and mopeds declined to
the level of 16 and 6 per cent respectively. A clear picture of the
motorcycle segment's gaining importance during this period is
exhibited by the Figures 1, 2 and 3 depicting total sales, share and
annual growth during the period 1993-94 through 2003-04.
National Council of Applied Economic Research (NCAER) had
forecast two-wheeler demand during the period 2002-03 through
2011-12. The forecasts had been made using econometric
technique along with inputs obtained from a primary survey
conducted at 14 prime cities in the country. Estimations were
based on Panel Regression, which takes into account both time
series and cross section variation in data. A panel data of 16 major
states over a period of 5 years ending 1999 was used for the
estimation of parameters. The models considered a large number of
macro-economic, demographic and socio-economic variables to
arrive at the best estimations for different two-wheeler segments.
The projections have been made at all India and regional levels.
Different scenarios have been presented based on different
assumptions regarding the demand drivers of the two-wheeler
industry. The most likely scenario assumed annual growth rate of
Gross Domestic Product (GDP) to be 5.5 per cent during 2002-03
and was anticipated to increase gradually to 6.5 per cent during
2011-12.

46
It is important to remember that the above-mentioned forecast
presents a long-term growth for a period of 10 years. The high
growth rate in motorcycle segment at present will stabilize after a
certain point beyond which a condition of equilibrium will set the
growth path. Another important thing to keep in mind while
interpreting these growth rates is that the forecast could consider
the trend till 1999 and the model could not capture the recent
developments that have taken place in last few years. However,
this will not alter the regional distribution to a significant extent.
At the all India level, the demand for motorcycles will be almost
10 times of that of the scooters. The same in the western region
will be almost 20 times. It is also evident that motorcycle will find
its major market in the western region of the country, which will
account for more than 40 per cent of its total demand. The south
and the north-central region will follow this. The demand for
scooters will be the maximum in the northern region, which will
account for more than 50 per cent of the demand for scooters in
2011-12.
Demand Forecast for Motorcycles and Scooters for 2011-12
2-Wheeler
Segment
Regions
South West
North-
Central
East &
North-East
All
India
Motorcycle
2835
(12.9)
4327
(16.8)
2624
(12.5)
883
(11.1)
10669
(14.0)
Scooter
203
(2.6)
219
(3.5)
602
(2.8)
99
(2.0)
1124
(2.08)
Note: Compound Annual Rate of Growth during 2002-03 and 2011-12 is presented
in parenthesis
Source: Indian Automobile Industry: Optimism in the Air, Industry Insight,
NCAER

47
The present economic situation of the country makes the scenario
brighter for short-term demand. Real GDP growth was at a high
level of 7.4 per cent during the first quarter of 2004. Both industry
and the service sectors have shown high growth during this period
at the rates of 8.0 and 9.5 per cent respectively. Taking into
account all these factors along with other leading indicators
including government spending, foreign investment, inflation and
export growth, NCAER has projected an average growth of GDP
at 6.7 per cent during the tenth five-year plan. Its mid-term forecast
suggests an expected growth of 7.4 per cent in GDP during 2004-
05 to 2008-09. Very recently, IMF has portrayed a sustained global
recovery in World Economic Outlook. A significant shift has also
been observed in Indian households from the lower income group
to the middle-income group in recent years. The finance companies
are also more aggressive in their marketing compared to previous
years. Combining all these factors, one may visualize a higher
growth rate in two-wheeler demand particularly for the
motorcycle segment.
There is a large untapped market in semi-urban and rural
areas of the country. Any strategic planning for the two-wheeler
industry needs to identify these markets with the help of available
statistical techniques. Potential markets can be identified as well as
prioritized using these techniques with the help of secondary data
on socio-economic parameters. For the two-wheeler industry, it is
also important to identify the target groups for various categories
of motorcycles and scooters. With the formal introduction of
secondhand car market by the reputed car manufacturers and easy
loan availability for new as well as used cars, the two-wheeler
industry needs to upgrade its market information system to capture
the new market and to maintain its already existing markets.
Availability of easy credit for two-wheelers in rural and smaller
urban areas also requires more focused attention. It is also
imperative to initiate measures to make the presence of Indian two-
wheeler industry felt in the global market. Adequate incentives for
promoting exports and setting up of institutional mechanism such

48
as Automobile Export Promotion Council would be of great help
for further surge in demand for the Indian two-wheeler industry.

49
TWO-WHEELER SEGMENTATION – BASED ON
TYPES
Two wheelers segmentation includes
• Scooters: -
Scooters earlier were vehicles with metallic body, bulky
and strong engine, rigid gear box, which played a role of an all
rounder. It had ample amount of luggage space since it was
inspired by tourer vehicles. The biggest disadvantage was the
kick, used for starting this vehicle.
But today the trend has changed. Scooters are not bulky
and most of them have no rigid gears. Presently the non-geared
vehicles are the trend setters. Thanks for the advanced
engineering. They are lot more performance oriented. They
have good fuel efficiency than before. Also, they are not just
“like it or leave it” product now. They look good and attractive.
And the biggest drawback has been overcome with help of
digital ignition systems.
• Mopeds and Scooterettes: -
Mopeds were first manufactured in the country by
Automobile Products of India in the year 1955. Nearly three
decades later the first indigenous two-seater moped was rolled
out of the TVS factory in Hosur, Tamil Nadu.
Mopeds are very light, non powerful vehicles. The
Unique Selling Proposition (USP) these vehicles are its cost and
fuel efficiency. They can be very useful for daily nearby
commutes.
Mopeds lack performance and are not suitable for heavy
conditions. Also, they lack maneuverability.

50
Scooterettes are vehicles that are bigger than mopeds.
They are functionally almost similar to mopeds. But their USP
is that they are more performance efficient. Have ample space,
along with good maneuverability.
T.V Sundaram Iyengar and Sons Limited (TVS), were
the first to launch indigenous Scooterettes in the Sub 100 cc
category in the year 1984.
• Motorcycles: -
This is the category of two-wheeler that needs no
introduction. This is the most prominent segment in the present
day. Motorbikes are geared machines that combine all essential
aspects of engineering in order to provider efficiency in all
related aspects like speed, mileage, pick up etc.
Motorcycles have come a long way since they were
first introduced in the country way back in the 1950s. The
Indian government had got the first set of these mean machines
from the Royal Enfield Company of UK for its' Army and
Police to patrol the border highways on the rough and tough
terrain of the West. Today these sets of two wheelers not only
cater to the men in uniform, but also common people who have
different needs and expectations from their motorcycles. Today
motorcycle companies are taking special care to make their
products more user friendly comfortable, safe, and ergonomic
without compromising on the fun and thrills of riding.

51
TWO-WHEELER SEGMENTATION – BASED ON
CAPACITY OF THE BIKE
• Low level bikes: -
These are two wheelers below 100cc. once was a very
prominent segment, but today is on its way for extinction due to
new aged fuel-efficient bikes which provide more power. For time
being, mopeds and scootrettes also fall under this segment.
E.g.: - Luna, Bajaj byk, M80 etc.
• Entry level segment: -
This segment is probably the most competitive segment
in India. Almost all players have their presence in this segment.
This segment fulfills consumer demands like affordable price,
good fuel economy, less maintenance etc. 100cc two wheelers
come under this segment.
E.g.: - CT100, CDDawn, Star City etc.
• Executive commuters:-
110cc bikes fall under this segment. This segment
fulfills demands such as good looks along with good fuel
efficiency and value for money.
Eg:- Platina, discover, Spendor, Victor etc.
• 125cc commuter:-
All 125cc bikes fall in this category. These bikes are
meant for consumers who need all power with good fuel
efficiency, looks and value for money. This is a new segment and
competition in this segment is on fire.
Eg:- Super Spendor, Discover dtsi, Victor glx ultra etc.

52
• 125cc executive :-
This is a bit costlier than the ‘commuter’ segment.
Just a few cosmetic changes for the consumers are available here.
Very few players have entered here. Eg. Yamaha Gladiator.
• 150cc:-
The use of word ‘power’ starts here. 150cc bikes
fall in this category. These bikes are big, good looking, sportier
and are meant for youth.
Eg:- Pulsar DTSi, CBZ Xtreme, Apache etc.
• 180cc:-
A hike in 150cc bikes. 180cc is just about power
and efficient technology.
Eg:- Pulsar, Avenger
• Power bikes segment:-
The upcoming segment in India. All 200cc bikes
and higher fall under this category. Consumers looking for bikes
which are different and are ready to shell out some more money,
can go for this segment. Eg:, Pulsar 220cc, Karizma etc.

53
EXISTING PLAYERS
1. Bajaj Auto Ltd.
2. Hero Honda
3. TVS
4. Honda
5. Yamaha
6. Suzuki
7. Kinetic
8. Royal Enfield
9. Kanda Motors
10.LML
11.Electric Bikes
These are the brands that are having a tough competition
to prove themselves. Lets have a look at these brands in detail.
1. Bajaj Auto Ltd.
Bajaj is well known as the king of scooter
manufacturers. It was the first one to bring performance and fuel
efficient scooters into the market at an economical price. But at the
ending stages of 1980’s the demand for scooters plunged. The
reason, “Advent of four stroke engines.” Four stroke engines are
well known for their fuel efficiency, ergonomics and the biggest
factor, The price.
All the manufacturers shifted their production towards
the bikes. Bajaj too did the same. From then it is well know for
quality and economical products. It is also well known for its
newly emerged R & D known as “AHEAD”. This has given the
two wheeler market some revolutionary products and technologies.

54
Infrastructure:-
Bajaj has 3 plants located at,
• Mumbai - Pune Road, Akurdi, Pune 411 035
Geared and non geared scooters, Discover and ct 100 are
produced over here.
• Bajaj Nagar, Waluj, Aurangabad 431 136
Kawasaki range of motorcycles and three wheelers are
produced here.
• MIDC, Plot No A1, Mahalunge Village, Chakan 410 501
Dist. Pune
This plant is mainly dedicated for Pulsar and discover.
Management
Rahul Bajaj – Chairman
Madhur Bajaj – Vice Chairman
Rajeev Bajaj – Managing Director
Sanjeev Bajaj – Executive director
Kawasaki
Bajaj Auto has a technical tie-up with Kawasaki Heavy Industries
of Japan to produce a range of the latest, state-of-art two-wheelers
in India. Since the tie-up in 1986, Bajaj Auto has launched KB100,
KB RTZ, KB125, 4S, 4S Champion, Boxer, Caliber, Caliber115,
Wind125 and India's first real cruiser bike, the Kawasaki Bajaj
Eliminator.

55
A Fortune 500 company with a turnover of USD 10 billion (Rs.
45,840 crore), Kawasaki Heavy Industries has crafted new
technologies for over a hundred years. These technologies have
redefined space systems, aircrafts, jet engines, ships, locomotive,
energy plants, construction machinery, automation systems, apart
from a range of high quality, high reliability two-wheelers.
Kawasaki has given the world its legendary series of 600-1200cc
Ninja and 1600 Vulcan bikes. Straight from Kawasaki design
boards, the Kawasaki Bajaj Eliminator redefines the pleasure of
"biking" in looks as well as performance.
Products insight
(Note: detailed knowledge base about the products can be referred
in the annexure)
• Pulsar twins
Pulsar is one of the biggest hit of bajaj in recent times. Its selling
like hot cakes. Muscular looks, good fuel efficiency, greater power
and economical price are the reasons behind its success. Initial
launch was made as pulsar twins (150 cc and 180cc) as normal
bikes. But bajaj was on its way for more changes in this bike. As
demand for the bike grew higher, prices were slashed down, and
major indigenous technology like DTS-I, ExhausTec, digital
transmissions and many other cosmetic changes have been made.
Every year consumers get something new in this bike.
• Discover DTS-I 125cc
Discover was the bike that gave rise to a new bike segment in
India. This is a 125 cc bike with almost all the technology used in
Pulsar. Its mileage and pick up, are the most appreciated by the
people. Bajaj has made few cosmetic changes in this bike after its
launch. This bike truly proves that days of 100 cc bikes are over.

56
With a 125 cc bike having mileage similar to 100cc, power just a
bit less than 150cc, and price almost economical, the need for 100
cc cant be found.
• Discover 112cc
As discussed above 100 cc bikes are on its way to get diminished,
110cc bikes have good chance in the market. Consumers get good
looking bigger bike in discover 112cc.
• Platina
This is a 100 cc bike, but with good cosmetic variations. The
comfort of riding is what people like in this bike. Also it is very
economical for a common man.
• CT 100
Here’s another hit by Bajaj. Ct 100 is a 100cc bike. It is well
known as “Everyones’ Bike”. There is no extra weight on any of
its feature. It’s a simple machine, which delivers nominal
commuting power, extremely good efficiency and value for
money.
• Krystal
Krystal is a scooterette that combines Bajaj’s all indigenous
technologies. This vehicle includes some mind blowing features
never before on any other scooterettes. Its a 94cc engine with a
normal build of 70cc scooterettes. This is the major advantage.
This helps in a lot of gain in speed, mileage etc.
• Wave
A non geared scooter which combines features both of bike and a
scooter. Not much a hit in the market.

57
• Pulsar 200cc
Another new segment starter by BAJAJ. Cosmetics are like its
ancestor. But this bike provides a lot more power. Also includes
some new gadgets. Features in this bike can be matched to
international standards.
• Pulsar 220cc DTS-Fi
Power, Power and Power, is the reason behind this bike. Not yet
launched but will be launched soon. Has some really cool features
that are based on international norms. Fuel injection is the first in
India in this segment.
• Avenger
A cruiser bike in India? Surprises all, but avenger is truly a cruiser
bike for cruiser lovers with little cash. It’s a 180cc engine and a
Good package in all aspects, which makes it unique.
2. Hero Honda
Hero Cycles and Honda Motor Company of Japan inked their joint
venture in India in April 1984. In a little over two decades, the
world's largest manufacturer of bicycles and the global leader in
motorcycles have created not only the world's single largest
motorcycle company but also the most endearing and successful
joint venture for Honda Motor Company worldwide. The company
has sold over 15 million motorcycles.
Infrastructure
In two decades, 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.

58
Management
Mr. Brijmohan Lall Munjal - Chairman & Whole-time Director
Mr. Pawan Munjal - Managing Director
Mr. Toshiaki Nakagawa - Jt. Managing Director
Mr. Takao Eguchi - Whole- time Director
Achievements
In this period, Hero Honda has set up over 2400 customer touch
points, comprising a mix of dealers, service centres and stockists
across rural and urban India. Today, Hero Honda is an amalgam of
winning networks and relationships with internal and external
stakeholders, 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.
Products insight
• Pleasure
It’s a 100cc segment scooter. Clean designing and power are the
best features. Also is very compact being a scooter. May be its
marketed as only for ladies, but is a very good commuter for all.
• CD Dawn
A bike, creating a legend in India. Price is the biggest USP of this
bike. It’s a bike made less for looks and more for job.
• CD Delux
Just a few more cosmetic changes to CD Dawn. Also a few tweaks
in the engines, making it performance efficient.

59
• Splendor Plus
A bike which doesn’t have much to be looked. But has a very
efficient performance. It’s a very simple design allowing ease for
commuting. Again price and quality are its USP.
• Passion Plus
Passion plus is just a surgery made to splendor. A bit extra money
to be spent just for a cosmetic change.
• Super Splendor
Splendor lacks power. But Super Splendor makes it up. It’s a
125cc bike with extremely well refined engine & good
maneuverability. Value for money is its USP.
• Glamour
Glamour is a stylish version of Super Splendor. Has a good build
and good looks also.
• Glamour FI
India’s first fuel injected bike. Fuel injection offers tremendous
increase in mileage and throttle response.
• Achiever
A medium built 150cc Bike, having the engine of HONDA
Unicorn.
• CBZ X- treme
The trend setter classic CBZ is gone. Now it’s a new entry with
every thing changed. Has some competitive features. But is too
pricy.

60
• Karizma R
A 225cc bike which created a new segment into the market. No
competitors at present. So this may be the USP of this product.
3. TVS
TVS was established in 1911 by Shri. T V Sundaram Iyengar. As
one of India’s largest industrial entities it epitomizes Trust, Value
and Service. Today, there are over thirty companies in the TVS
Group, employing more than 40,000 people worldwide and with a
turnover in excess of USD 2.2 billion.
With steady growth, expansion and diversification, TVS
commands a strong presence in manufacturing of two-wheelers,
auto components and computer peripherals. TVS Motor Company
Limited, the flagship company of the USD 2.2 billion TVS Group,
is the third largest two-wheeler manufacturer in India and among
the top ten in the world, with an annual turnover of over USD 650
million.
Management
Venu Srinivasan - Chairman & ManagingDirector
Gopal Srinivasan - Director
T.K.Balaji - Director
T. Kannan - Director
N. Ganga Ram - Director
C.R.Dua - Director

61
Achievements
TVS Motor Company is the first two-wheeler manufacturer in the
world to be honoured with the hallmark of Japanese Quality – The
Deming Prize for Total Quality Management.
Products insight
• Scooty Pep+
A well built scooterette. Its zippy and light in weight, making it
tuned for college going.
• Scooty Teenz
A simple well built scooterette for close commuting purpose.
• Star STD
Max 100R was again a classic commuter by TVS Suzuki. Star
Standard is a good replacement for Max 100R.
• Star City
A perfect 100cc commuter bike, with all good looks, good engine
and well build. Well known for its fuel efficiency.
• Victor Edge
A successor of Victor which is still known for its record sales. It’s
a 110cc engine with extra smooth ride serving as its USP. RCF, An
indigenous technology adds extra advantage.
• Victor GLX 125
A 125cc bike with good cosmetics for attraction.

62
• Apache ES
Another successor, apache is a 150 cc bike with the old fiero
engine. Muscular looks and 5 gears now is its USP.
4. Honda
Official Name - Honda Motorcycle & Scooter India Pvt. Ltd.
Established - 20th Aug, 1999
Capital - Rs. 300 Crore
Representative - Mr. Yukihiro Aoshima, President & CEO
Factory Location - Manesar, District Gurgaon, Haryana, India
Production Capacity - 7,50,000 units per year
Products insight
• Activa
A truly unbelievable performer. It was this vehicle which that
brought the scooter back to India after a plunge in the scooter
segment. Its quality an efficiency are the best.
• Dio
Activa is a true scooter, while Dio starts a new segment of
motoscooters in India.
• Eterno
Finally, an earnest effort to preserve geared scooter. Eterno is well
known for its fuel efficiency.

63
• Shine
It’s a 125cc commuter, again the performance acts as its USP. Also
the name and fame of HONDA is an added advantage.
• Unicorn
A 150cc bike which proves HONDA engineering in India. A very
well refined engine, good performance and fuel efficiency are its
USP.
5. Yamaha
Yamaha Motor India Sales Pvt Ltd is a wholly owned subsidiary of
Yamaha Motor Co, Ltd, Japan. Having operated in India as
technology provider for almost two decades, YMI was
incorporated in August 2001 as 100% subsidiary of YMC, Japan.
Products insight
• Crux S
An entry level bike well known for its gear box. But no way
matches to RX 100.
• Libero G5
Well known as an all rounder by Yamaha.
• Gladiator
A 125 cc bike which never makes you feel u have a small bike.
Well refined engine.

64
6. Suzuki
SUZUKI MOTORCYCLE INDIA PRIVATE LIMITED is a
subsidiary of Suzuki Motor Corporation, Japan where in we are
having the same manufacturing philosophy of VALUE PACKED
PRODUCTS right from the inception. SMIPL will be
manufacturing two wheelers best suited for the valuable Indian
customers covering all segments.
Plant area and production
Suzuki has installed its manufacturing plant in Gurgaon (Haryana)
having the annual plant capacity of 1,20,000 units.
Capital - Rs. 713.43 Million
Management
Mr. Satya Sheel Khosla - Managing Director
Mr. Katsumi Takata - Jt. Managing Director
Infrastructure
Suzuki has its technological plant at Village Kherki Dhaula,
Badshahapur, L.H.-8, Link Road, Gurgaon.
Products insight
• Heat
A 125 cc commuter. No mind blowing performance as yet. A long
way to go.
• Zeus
A new type of design in Indian market. Couldn’t mark its presence
at initial stages.

65
7. Kinetic Engineering
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, v- twin 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 collaborations 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.
Current popular brand names include Luna, Nova 135, Zing,
Velocity, Boss, Aquila, Comet.
Products insight
• Kine
College commuter that provides ease of riding.
• 4s
Pretty old scooter in India. Still working.

66
• Nova 135
Good looking scooter. Pretty quick in traffics.
• Striker
An entry level bike that shows efforts of kinetic to remain in the
market.
• Blaze
“Italiano”. A 165cc italian design marking its presence by its
success. Long drive comfort is its USP.
8. Royal Enfield
Products insight
• STD
A 350cc cruiser, too old for Indian market.
• Machismo A350
350 cc engined cruiser with some good chrome works.
• Electra 5S
A refined engine now. 5 gear as international pattern is an
advantage.
• Thunderbird
Enfield with a real cruiser quality. Great design also.

67
• 500 EX
Still struggling to bring the lost segment of 500cc cruiser.
9. Kanda Motors
Products insight
• Mission 100
A new entry in this competitive market. Well build is its USP.
10. LML
Products insight
• LML CRD 100 Super Delux
An earnest effort to compete the market. A very good package of
features and refinement.
• Freedom Topper
Dull in market. Surprisingly good consumer response.
• Freedom 125 Prima
Again dull in market. But makes a pretty good commuter.
• Beamer
A 150 cc bike with new design. The looks are its USP.

68
SAMPLE SPACE INSIGHT
The sample space area selected here is Pimpri –
Chinchwad area. To get closer to this area lets have an insight into
its details.
• Geographic importance:-
Pimpri-Chinchwad is located towards the west of Pune city. The
Mumbai Pune Highway acts as a major connection between
Pune city and pimpri chinchwad. Also octroi and R.T.O to this
area is lesser than that of Pune. This is of great advantage for
transportation.
• Economic importance:-
Major sections of M.I.D.C (Maharashtra industrial
Development Corporation) in Pune are located here. Thus the
industrial background of this area is very strong. Pimpri-
Chinchwad is known as a Detroit. It has been included as one of
the highest revenue earner in Asia.
• Demographic importance:-
Consumers play a very important role in every sector. Pimpri-
Chinchwad area being an industrial area, people of various
class, standards and difference are found here.
• Importance in this Project:-
Variety of consumers plays a very important role in the
accuracy of project. Also major automobile players have their
plants located here.

69
Eg:- Bajaj, Kinetic Engineering, TATA Motors, Kanda,
Mercedes, etc.
Thus due to these large scale automobile industries, related
small scale industries are also located here. This generates a
large employment. Also this area accommodates tough
competition since it becomes a local area for above industries.
Also to mark their presence other competitors try their best to
establish themselves in this area.
In short, a project in Pimpri chinchwad on two
wheeler market can increase the accuracy of the conclusions.
FINANCE SECTOR
Growing popularity of Automobile Sector has brought
great changes in Finance Sector also. Gone are the days when
the customer had to wait for appointments at banks while
getting loans issued. Today the bank personnel themselves
approach the customers, for providing them loans. All
formalities have gone easy. Almost all banks have started
providing loans at 0% interest on vehicles. Some banks also
provide good financial deals on second hand vehicles. Eg:-
ICICI Bank, HDFC Bank, City Finance etc.
INSURANCE SECTOR
R.T.O rules have played an important role in joining the
Insurance Sector to the Two Wheeler Sector. The brands while
delivering the vehicle mostly give one year insurance. But the
point to be noted here is that people directly get knowledge
about insurance which is an add on for insurance brands. This
also increases the demand for insurance in other sectors. Eg:-
ICICI Insurance, Oriental Insurance, Bajaj Allianz etc.

70
FUEL SECTOR
Feels like a very calm sector, but isn’t. Private players
like Reliance and Essar have entered the market. An alarming
cold competition exists. Petrol today rates almost Rs.50 per
litre. People need more in what they pay. So the petrol brands
are making their earnest efforts to provide high quality fuels to
the consumers at an economical price.
Eg:- 1.Additive Fuel:- SPEED, POWER, XTRA PREMIUM etc.
2. High Octane Fuel
OIL SECTOR
Four stroke engines require much more maintenance than a
two stroke engine. Thus engine oil play a very important role. Oil
brands are on constant efforts to provide consumers with good
synthetic oil that are economical and work well for their two
wheelers. Eg:- MOTUL , CASTROL, GULF etc.
SPARE PARTS
After the sale of a product, the next important thing is to
have constant supply of spare products. A shortage in spares
creates a negative impression about the brand. This may also
affect the sales. Hence to remain on a safe side the two wheeler
brands keep contracts with third parties as a backup. This profits
a lot. Thus spares manufacturer is also in a good deal.
TRANSPORT SECTOR
Transport sector is no exception. It is also in great profit
due to two wheeler sector. Frequent transportation of both raw
materials and finished goods plays a very important role.

71
DATA REPRESENTATION
PART-2
Consumer Behavior and Two Wheeler Market
Segmentation
• CONSUMER BEHAVIOR
• MARKET SEGMENTATION
• THE SURVEY
• QUESTIONNAIRE
• QUESTIONNAIRE ANALYSIS

72
CONSUMER BEHAVIOR
• Meaning:-
Consumer behavior is the study of how people buy, what
they buy, when they buy and why they buy. It is a subcategory of
marketing that blends elements from psychology, sociology, socio
psychology, anthropology and economics. It attempts to
understand the buyer decision making process, both individually
and in groups. It studies characteristics of individual consumers
such as demographics, psychographics, and behavioral variables in
an attempt to understand people's wants. It also tries to assess
influences on the consumer from groups such as family, friends,
reference groups, and society in general.
• Importance:-
The biggest rule of marketing, “Consumer Is The
King”. Hence it is very important to understand the consumers’
mentality. Consumers get attracted towards a particular product
very fast, which is a difficult situation. This may sometimes prove
beneficial but is very dangerous in long terms. Thus, if the
marketer knows well about the consumers, proper precautions can
be taken.
• Consumer Behavior Complexity:-
Various psychological, sociological, demographic and
economic factors affect the behavior of the consumers. Consumers
are more prone to indirect brain wash. Their thinking is mainly
affected due to factors such as advertisements, other people,
analysis etc. According to scientists, attitudes develop gradually
due to interactions with family, society and work groups. Attitudes
may be positive or negative and thus they affect the purchasing
decisions.

73
Influence of religion language Etc.
Status influencing Buyer Behavior
Socio- Cultural Environment or Group
Influence affecting Buyer Behavior.
Influence of Intimate
Group on Buyer Behavior.
Influence of broad social
class on Buyer Behavior.
FACTORS INFLUENCING
BUYER BEHAVIOR
Impact of information from variety of
sources & various types of media.

74
THE BUYING
PROCESS
1. Customers perception of problems.
2. Awareness of the Existence of the
product.
3. Comprehension/ Information Processing
Store
4. Attitude towards the Product
5. Legitimatization
6. Evaluation of the product
7. Comprehension / Information Processing
Store.
8. The Post Purchase Dissonance

75
MARKET SEGMENTATION
Definition:-
“Market Segmentation consists of taking the total
heterogeneous market for a product and dividing it into several sub
markets or segments each of which tends to be homogeneous in all
“Significant Steps.”
Marketing Segmentation Variables:-
People Oriented Approach
Socio-Economic Variables
(Characteristics)
Geographic and Territorial
Segmentation
Income, Education,
Profession, Region
etc.
Psychological segmentation
Volume Segmentation
Eg. Bulk purchase, Unit
purchase.
Benefit Segmentation
Primary or
Generic Utilities.
Secondary or
Evolved Utilities.

76
Product Orientation Approach
Price of the Product
Quality of the Product
Brand of the Product
Advertising of the Product
Promotional Devices
Attitude of the Buyer Motivation

77
THE SURVEY
DATE :- 26th
February, 2007 to 5th
March, 2007.
PLACE :- R.T.O (Pimpri – Chinchwad)
SUBJECT :- Consumer Behavior
DATA
COLLECTION
METHOD :- Questionnaire Method
AIM :- To get a practical experience about consumers’
attitude, their preferences and buying behavior.
NUMBER OF
RESPONDENTS:- 100
CRITERIA
OF DIVISION :-
• Brand Usage
• Brand Preference Influences
• Sex
• Age
• Occupation
• Income
• Marital Status
• Mode of Purchase
• Media influence

78
• QUESTIONNAIRE
A STUDY OF CONSUMER BEHAVIOR IN PIMPRI-
CHINGHWAD
1. Name:- _________________________________________
2. Address:- _______________________________________
_______________________________________
3. Age:- __________
4. Sex:-
Male:- _____ Female:- _____
5. Occupation:-
Government Sector:-_____ I.T. Sector:-______
Other Pvt. Sector:- _____ Business:- ______
Students:- _____
6. Monthly Income:-
Less than Rs.10,000:- ____ Rs. 10,000–Rs.20,000:- ____
Rs.20,000 and above:-____
7. Marital Status:- married / unmarried
8. Name some two wheeler brands you know
_______________________________________________
_______________________________________________

79
9. How did you come to know about these brands?
Radio:___, T.V: ___, Internet ___, Newspapers: ___,
Magazines: ___,Hoardings: ___, Friends: ___,
Dealers: ___, others___.
10. What are your Rides?
_______________________________________________
_______________________________________________
11. What was the mode of purchase when you purchased your
ride?
Full Payment: ___, Installment: ___, Loan: ___, Gift: ___
12. Which brand would you recommend?
_______________________________________________
13. Reason for recommending that particular brand?
Price: ___, Fuel Economy: ___, Power: ___,
Brand Image: ___, Technology: ___,
Spare Parts Availability: ___, After Sales Service: ___,
Other: ___.

80
QUESTIONNAIRE ANALYSIS
The questionnaire behind gives some appropriate data
related to the consumers’ mentality. Following are the outcome of
the Questionnaire Method.
• BRAND USAGE.
This study shows the number of respondents using
various brands.
BRAND NAMES NUMBER OF
RESPONDENTS
PERCENTAGE OF
TOTAL
BAJAJ 30 30%
HERO HONDA 24 24%
T.V.S 15 15%
HONDA 10 10%
YAMAHA 5 5%
SUZUKI 2 2%
KINETIC 4 4%
ROYAL ENFIELD 3 3%
KANDA MOTORS 1 1%
LML 5 5%
ELECTRIC BIKES 1 1%
Total Number
of
Respondents = 100
100%

81
The following pie chart shows the chunk of market occupied by
the various brands.
Brand Usage
1%5%
1%3%
4%
5%
10%
15% 24%
2%
30%
BAJAJ HERO HONDA TVS
HONDA YAMAHA SUZUKI
KINETIC ROYAL ENFIELD KANDA MOTORS
LML ELECTRIC BIKES
Fact:-
As seen above Bajaj leads in the Brand Usage. The
main reason for this is that Pimpri – Chinchwad is the home
locality for Bajaj. And no manufacturer will want his brand to fail
in the local area. So, earnest efforts are made by Bajaj Auto Ltd.

82
• BRAND PREFERENCE INFLUENCES
The table below shows various factors influencing
consumer selection of brands?
Facts:-
From the above table it can be concluded that Fuel
Economy (25%) still remains a major factor influencing Consumer
Brand Selection ie. Consumer Preference.
Brand
Names Price
Fuel
Economy
Power Design &
Technology
Spare Parts
Availability
Service
Quality
Brand
Image
Other Total
Bajaj 10 6 4 3 4 2 1 - 30
Hero
Honda
5 7 3 2 2 3 2 - 24
T.V.S 5 2 2 1 - 5 - - 15
Honda 1 1 - 2 - 1 5 - 10
Yamaha - - 1 1 - - 2 1 5
Suzuki - - - 1 - - 1 - 2
Kinetic 2 - - - - 1 - 1 4
Royal
Enfield
- - - - - - 3 - 3
Kanda
Motors
- 1 - - - - - - 1
LML 2 1 - 1 - - 1 - 5
Electric
Bikes
- 1 - - - - - 1
Total 25 19 10 11 6 12 15 2 100

83
• SEGMENTATION ON BASIS OF SEX
The following table shows the influence of various two
wheeler segments on male and female parts of the demography.
SEGMENT MALE FEMALE TOTAL
LOW LEVEL BIKES,
MOPEDS,
SCOOTRETTES
5 13 18
SCOOTERS 5 5 10
ENTRY LEVEL
BIKES (100cc)
13 1 14
EXECUTIVE
COMMUTERS
(NEARBY 115cc)
14 - 14
125cc EXECUTIVE
COMMUTERS
15 - 15
150cc PREMIUM 15 1 16
180cc PREMIUM 8 - 8
POWER BIKES
(ABOVE 200cc)
5 - 5
PERCENTAGE 80% 20% 100%

84
80%
20%
0%
10%
20%
30%
40%
50%
60%
70%
80%
PERCENTAGE
MALE FEMALE
SEX
CONSUMER SEGMENTATION BASED ON
SEX
Facts:-
From the above data it is clear that the two wheeler
sectors are dominated by men. The table shows that female are
mainly attracted towards scooters, mopeds and scootrettes. Off
course there are exceptions, but are negligible.

85
• SEGMENTATION ON BASIS OF AGE
SEGMENT 16 to
17
yrs.
18 to
25
Yrs
26 to
35
Yrs
36 to
45
Yrs
46yrs.
&
Above
T
O
T
A
L
LOW LEVEL
BIKES,
MOPEDS,
SCOOTRETTE
10 2 - - 6 18
SCOOTERS - 2 1 1 6 10
ENTRY
LEVEL BIKES
(100cc)
- 1 4 4 5 14
EXECUTIVE
COMMUTERS
(NEARBY
115cc)
- 6 3 2 3 14
125cc
EXECUTIVE
COMMUTERS
- 10 4 1 - 15
150cc
PREMIUM
- 12 2 1 1 16
180cc
PREMIUM
- 7 1 - - 8
POWER BIKES
(ABOVE
200cc)
- 4 1 - - 5
Total 10 44 16 9 21 100

86
CONSUMER SEGMENTATION BASED ON AGE
21
9
16
44
1016-17
18-25
26-35
36-45
46 & above
AGE
PERCENTAGE
Facts:-
The above chart clearly shows that the youth can serve
as a major target market for two wheeler manufacturers. They
occupy a handsome 44%.

87
• SEGMENTATION BASED ON OCCUPATION
SEGMENT Govt.
Sector
IT
Sector
Other
Pvt.
Sector
Busi-
ness
Students T
O
T
A
L
LOW LEVEL
BIKES,
MOPEDS,
SCOOTRETTE
4 - 2 2 10 18
SCOOTERS 2 - 3 4 1 10
ENTRY
LEVEL BIKES
(100cc)
4 - 8 1 1 14
EXECUTIVE
COMMUTERS
(NEARBY
115cc)
1 2 6 1 4 14
125cc
EXECUTIVE
COMMUTERS
1 3 6 - 5 15
150cc
PREMIUM
- 3 2 3 8 16
180cc
PREMIUM
- 4 - - 4 8
POWER
BIKES
(ABOVE
200cc)
- 1 1 1 2 5
Total 12 13 28 12 35 100

88
CONSUMER SEGMENTATION BASED
ON OCCUPATION
12%
13%
28%
12%
35%
0 20 40 60 80 100 120
1
OCCUPATION
PERCENTAGE
govt it pvt business students
Facts:-
It can be seen students and people working for Private Sectors
are more attracted towards the two wheelers.

89
• SEGMENTATION BASED ON INCOME
SEGMENT Below
Rs.
6000
p.m.
Rs.6000-
Rs.15,000
p.m.
Rs.15,000-
Rs.25,000
p.m.
Rs.25000
& above
T
O
T
A
L
LOW LEVEL
BIKES,
MOPEDS,
SCOOTRETTE
7 1 - - 8
SCOOTERS - 7 - 2 9
ENTRY
LEVEL BIKES
(100cc)
- 12 1 - 13
EXECUTIVE
COMMUTERS
(NEARBY
115cc)
- 5 5 - 10
125cc
EXECUTIVE
COMMUTERS
- 3 7 - 10
150cc
PREMIUM
- - 6 2 8
180cc
PREMIUM
- - 2 2 4
POWER
BIKES
(ABOVE
200cc)
- - - 3 3
Total 7 28 21 9 65
Percentage 10.77 43.07 32.31 13.85 100

90
There are 35 students in this survey. All the students
have no genuine sources of income. Hence out of 100 respondents,
35 students have been deducted in the above data.
Total no. of respondents = 100
Total no. of students = 35
_____
Remaining respondents = 65
MARKET SEGMENTATION ON
BASIS OF INCOME
10.77
32.31
43.07
13.85
Below 6000
6000 to 15000
15,000 to 25,000
25,000 & above
PERMONTHINCOME
(Rs.)
PERCENTAGE
Facts:-
People earning a salary of Rs. 6,000 p.m. to Rs. 15,000
p.m. are a good target for two wheeler manufacturers. The main
reason for this tendency is that, there is no proper public mode
of transportation in Pimpri – Chinchwad area. Other modes of
transports like rickshaws are not economical. Thus a two
wheeler serves the best for common man.

91
• SEGMENTATION BASED ON MARITAL STATUS
SEGMENT MARRIED UNMARRIED TOTAL
LOW LEVEL
BIKES,
MOPEDS,
SCOOTRETTE
2 16 18
SCOOTERS 6 4 10
ENTRY
LEVEL BIKES
(100cc)
10 4 14
EXECUTIVE
COMMUTERS
(NEARBY
115cc)
9 5 14
125cc
EXECUTIVE
COMMUTERS
9 6 15
150cc
PREMIUM
6 10 16
180cc
PREMIUM
3 5 8
POWER
BIKES
(ABOVE
200cc)
1 4 5
Total 46 54 100

92
46%
54%
42%
44%
46%
48%
50%
52%
54%
PERCENTAGE
MARRIED UNMARRIED
MARITAL STATUS
MARITAL STATUS
Facts:-
A very close difference between both Married class and
Unmarried class. But results remain the same. Two wheelers are
more popular among unmarried class. Reason for this may be
predicted that the married people prefer four wheelers rather
than a two wheeler.

93
• SEGMENTATION BASED ON MODE OF PURCHASE
SEGMENT Full
Payment
Installment Finance Gift Total
LOW LEVEL
BIKES,
MOPEDS,
SCOOTRETTE
5 2 2 9 18
SCOOTERS 2 2 5 1 10
ENTRY
LEVEL BIKES
(100cc)
3 3 7 1 14
EXECUTIVE
COMMUTERS
(NEARBY
115cc)
2 5 7 - 14
125cc
EXECUTIVE
COMMUTERS
1 4 8 2 15
150cc
PREMIUM
- 5 10 1 16
180cc
PREMIUM
2 3 3 - 8
POWER
BIKES
(ABOVE
200cc)
2 1 2 - 5
Total 17 25 44 14 100

94
0
5
10
15
20
25
30
35
40
45
PERCENTAGE
Full
Payment
Installment Finance Gift
MODE OF PURCHASE
MODE OF PURCHASE
Facts:-
As explained before finance sector is one of the sectors that
has developed a lot along with automobile sector. As new
technologies emerge in the automotive industries, finance also
innovates new strategies to attract the consumers. In the above
chart it is clear that most of the people prefer financial schemes as
mode of purchase for their two wheelers. The very important point
to be noted is that even people who can afford full payment prefer
to purchase automobiles on financial schemes.

95
• SEGMENTATION ON BASIS OF MEDIA INFLUENCE.
Segment Radio T.V. Internet Newspapers Magazines Hoardings Friends Dealers Others
Low level
bikes,
scootrettes,
Mopeds.
1 6 - 5 - 2 2 1 1
Scooters - 5 - 2 1 - 1 1 -
Entry
Level
Bikes
- 7 - 3 - 2 - 2 -
Executive
Commuters
(Nearby
115cc)
1 3 2 2 2 1 1 2 -
125cc
Executive
Commuters
- 4 1 3 2 1 2 1 1
150cc
Premium
- 5 4 1 3 - 2 - 1
180cc
Premium
- 3 2 - 2 - 1 - -
Power
Bikes
(Above
200cc)
1 1 1 - 1 - - 1 -
Total 3 34 10 16 11 6 9 8 3
Facts:-
From the above data it is clearly visible that T.V &
Newspapers still have a very large impact on the consumers.
Magazines are slowly developing their space. Also internet is
emerging as a very good advertising media.
The above survey points out some important factors that
influence consumers buying decisions for two wheelers.

96
DATA REPRESENTATION
PART-3
Two Wheeler Marketing
• MARKET COMPLEXITY
• THE TWO WHEELER MARKETING STRATEGIES
• RECENT MARKETING ACTIVITIES

97
MARKET COMPLEXITY
Two wheeler market is a very dynamic market. This
market is being considered as the most dynamic market after the
software market. The reasons for dynamism are as follows:-
• Constant Innovation:- This introduces frequent changes in
the market every now and then.
• Consumer Tastes:- As consumers shift their likings, change
their purchase decisions, dynamism gets introduced into the
market.
• No Upgrades:- Software do give a chance to the consumers
for an upgrade. But for time being no upgrade methodologies
have been introduced in the market for the consumers. Only
turning the market towards complex dynamism.
• Emergence Of Foreign Competitors:- India is one of the
country to have such a huge two wheeler market. Hero
Honda, an Indian manufacturer has become world’s no.1 bike
manufacturer in sales. Hence it is obvious for Indian market
to attract foreign bike manufacturers.
• Legal Reforms:- As India is on its way to become a
superpower, the government has to keep revising its rules and
regulations to tackle constraints like inflation, deflation,
consumer protection breaches etc. this also affects a lot to the
two wheeler market, only making it dynamic.

98
THE TWO WHEELER MARKETING STRATEGIES
1. Target Market Selection Strategy
“Target Marketing” is nothing but selection of a
suitable section of the market for marketing of the product. In this
strategy a two wheeler manufacturer divides the market as per his
estimations and his view about his product.
Steps involved:-
• Detailed study on consumers
• Detailed study on the product
• Detailed study on the competitors product
• Proper division of the market
• Matching the product to the relevant division
• Finalization of the target
Advantages:-
• Reduction in burden
• Reduction in costs
• Reduction in wastages
• Proper time management
• Helps in price fixation
• Helps in deciding the type of promotion required for the
product.
Eg. A premium bike manufacturer cannot place his bike in the
executive segment.

99
2. Competitive Positioning Strategy
After determining the right division for his product a
two wheeler manufacturer is most bothered about the positioning
of the product. The product has to be introduced into the market in
such a way that it can face the competitors and also attract the
consumers. Hence most of the two wheeler manufacturers try to
position their products in such a way that either it gives a tough
competition to others or it creates a new segment where there are
no competitors.
Eg:- Hero Honda Ambition was the first 135cc bike in the Indian
market. No other manufacturers had a bike existing in this
segment.
3. Marketing Mix Strategy
A combination of Product, Price, Promotion and Place
together form a marketing mix.
Product Mix
• Physical Configuration:- In a two wheeler the physical
configurations that matter the most are capacity of the bike,
color, cosmetics, visual technologies used etc.
• Associated Services:- Services before sales include
demonstrations, trial rides, credit facility information etc.
Services after sales include delivery, warranty, spare parts
availability, servicing etc.
• Trade mark, Brand name, Product name:- Trade Mark is
used specially for the purpose of identity during transactions
or trade. Brand name is the name of the manufacturer.

100
Consumers most concentration lies on this. Product name is
the identity of a particular product manufactured.
Eg. The wings on Honda bikes is their trade mark.
‘Honda’ is the Brand name and ‘unicorn’ is the
product name.
• Product Complexity:- The biggest and probably most
sensitive factor in the two wheeler market is that the
consumer tends to moderate other products manufactured by
the producer also, even if he doesn’t plan to buy those other
products. Thus for a manufacturer it becomes very important
to tackle this tendency.
• Product Life Cycle:- The product life cycle of the two
wheelers are comparatively long and mainly affected by the
competitors product. A new bike liked by the consumers
undergoes growth first, then maturity and then starts to
decline. This is mainly due to change in consumer tastes.
maturity
decline
growth
introduction
Time

101
Price Mix
• Pricing Strategy:-A two wheeler is priced in accordance with
the proper target market. The price is competitive in nature
and earnest efforts are made so that the price gives a serious
competition to the rival products.
• Discounts & Schemes:- As seen above every product has its
growth and decline. During such stages the pricing schemes
& discounts provided to the customer are formulated very
carefully.
Promotion Mix
• Personal Selling:- A very recent concept that has gained
importance instantly in every field of marketing. In two
wheeler marketing personal selling is mainly used by the
dealers. It is very useful during direct interaction with the
consumers.
• Advertising:- The manufacturer has to make people aware
about his product. Hence advertising serves as a good tool. It
is mainly done through newspapers, t.v, internet etc.
• Sales Promotion:- This includes various promotional
activities that can boost sales, like demonstrations, trade fairs,
exhibitions etc.

102
Place Mix
• Distribution Channel:- In two wheeler market the
manufacturers have a very well organized distributive
network. This is a requisite as there are constant changes
in the tastes of the consumers.
The manufacturers in order to cope up with the problem of
shortages establish a well equipped depot in various parts of
the country. This depot supplies the vehicles to the dealers.
All these takes place at mass quantities. Dealers mainly
operate at the cities. But there are many small parts of the
country that don’t have dealers, thus sub dealers do the job in
these parts.
MANUFACTURING UNITS
COMPANY DEPOTS
IN DIFFERENT
STATES
DEALERS
SUB DEALERS

103
• Mode Of Transportation And Cost:- There are many third
party agencies which provide economical mode of
transportation for bulk deals. They provide trucks, trailers
etc. for this purpose. Transportation costs also include
defects that are caused during transport.
4. After Sales Strategy
The manufacturer not only produces the product but also
produces various add-ons for the product. Here its mainly spare
parts, free services, insurance schemes, extended warranty schemes
etc. Also he needs to keep a good contact with the customers, so as
to attract them from the existing products to a newer one. Thus all
these activities are fulfilled by the after sales marketing strategy.

104
RECENT MARKETING ACTIVITIES
• Pro Biking Showrooms by Bajaj:-
These are exclusive showrooms meant for premium
segment bikes manufactured by Bajaj. Pro Biking outlets are
found in selected cities. These showrooms provide some
extra facilities to the consumers for bike test rides. These
were the first in India to be equipped with dynamo-meter test
riding facilities. Also a 1 Km test ride is made available. In
short Pro Biking Showrooms are high tech, well facilitated
and have good communication with the consumers, which
makes it attractive.
• Showrooms exclusively for ladies:-
Another first of its kind in India which has been
introduced by Hero Honda. Such showrooms feature two
wheelers meant for female consumers. At present Hero
Honda has featured its 100cc scooter ‘Pleasure’ here. Such
showrooms do attract the limited number of customers.
• Celebrities:-
One of the most popular methods of attracting the
consumers is having a Brand Ambassador for the product. In
India Bollywood and Cricket are the most hyped and thus
most of the Brand Ambassadors for two wheelers are either
actors/actresses or cricketers.
Eg:- Hrithik Roshan is the Brand Ambassador for Hero
Honda. He was in Pune for the inauguration of showrooms at
Pimpri-Chinchwad area and Pune city.
John Abraham is Brand Ambassador for Yamaha, India.

105
• Foreign Bike Shows:-
Super bikes attract most of the two wheeler bikes. Due
to recent movies on super bikes they have become the dream
bike of most of the Indians. This tendency gives a good
opportunity to the manufacturers to attract the consumers
towards their showrooms.
Eg:- Yamaha showroom at Pimpri has featured the ‘Yamaha
Fazer 1000’. This attracts many consumers towards the
Showroom.
• Rally:-
The manufacturers themselves form a community of
riders who like to take part in long drives. Thus this
community organizes rally to various places. This gives the
bikers a chance for get together. Also the other people get
attracted towards the brand.
Eg:- Royal Enfield is the best known for such rallies.
• Internet Marketing and Selling:-
Internet has well served various brands as an
efficient tool for marketing their products. Recently Bajaj
launched an internet buying facility for its consumers. One
can log on to the official website and just by a couple of
mouse clicks can book his bike. This is another first of its
kind in India.
• Other activities like Road Shows, Test rides, Tele
marketing etc are also carried out.

106
SUGGESTIONS FOR PROBLEM SOLVING

107
• Consumers’ technical know how about the two-wheeler
As described above the technology used in a vehicle is
its biggest USP. Thus the consumers have to be made aware
about how these technologies will profit them. Following steps
can serve best for this purpose:-
1. Technology presentations
2. Auto expos
3. Meeting with the consumers
4. Live experimentations etc.
A demo is the best way to market the product a
particular product. This gives the customer a chance to get
closer to the product and judge it with his own experience. If
this problem arises just due to the fuel price factor, the
manufacturers can help the dealers with allowances for such
purpose.
A separate distribution plan for spare parts must be
formulated. Strengthening of communication channels can serve
the best. If a company develops prediction mechanism on basis
of its strong management, then it can predict the demand for
spare parts in advance.
Efficient utilization of the export opportunities is very
important. The best way to market the Indian bikes abroad is to
take part in international automobile expos. This may seem

108
impossible but its not. Indian bikes are far more scientific and
efficient than Chinese bikes. When a country like China can
show their bikes in such expos, India can easily get in.

110
CONSUMER BEHAVIOR
• If value for money is what consumers are looking for, then
there are the entry level motorcycles such as Bajaj CT 100,
TVS Star, and Hero Honda Dawn which are a great value for
money. The spiraling prices of petrol have further pushed up
the importance of these bikes as these two wheelers are
blessed with a healthy average. Looks are not that important
for these set of two wheelers as people who buy these bikes
usually do for the economic factor which is associated with
it.
• If the consumer is an executive with a multi national
company and he is concerned about the looks of the two-
wheeler, there's nothing to worry as there are a number of
two-wheelers in the market to give extra edge when it comes
to looks without pinching a big hole in the pocket.
Motorcycles such as Honda Unicorn, TVS Victor, Super
Splendor and Yamaha Libero are some of the bikes which
you can opt for. These motorcycles come with the looks, the
desired power and mileage that you are looking for.
• If the consumer wants the heads to turn and eyes to pop out
then he can opt for some performance based two- wheelers
these set of two wheels come with a hefty prize tag and the
eye catching looks. Bikes such as Bajaj Pulsar, Hero Honda
Karizma, and TVS Fiero fall in this category. Even Kinetic
has joined the race with the 165 cc Kinetic Blaze. These two
wheelers can talk to the winds and can provide that extra
thrill the consumer is looking for.
• For those consumers who just love riding and want to own a
set of two wheels just for the sheer fun factor associated with
it there are lots of motorcycles in the Royal Enfield Motor
stable. These bikes could be poor on mileage but extremely

111
rich on the thrill and fun factor. These bikes are extremely
suited for people who hit the highways pretty often, a fact
spelt out clearly with the success of Yamaha Enticer.
• If the consumer is a small time businessman and he needs to
transport a little luggage on two wheeler, scooters are the best
option. Though most of the companies have stopped
manufacturing the metal bodied scooters consumer could still
get his hand on them from the neighborhood friendly garage
fellow. If the consumer wants to pick up a brand new set of
wheels he can go for a Honda Eterno, Honda Activa and
Honda Dio.
• For female consumers who normally don't want the extra
burden of weight then two wheelers such as TVS Scooty,
Bajaj Wave and Hero Honda Pleasure can just be the right
choices.
Besides the general nature and category of product few other
things should be kept in mind while choosing a two wheeler, they
are as follows:
• Company network and after sales service
• Resale value of the two wheeler
• Cost of spare parts and their availability
• Nature of usage
• Terrain of the place where you intend to use the two-wheeler

112
BUYING PROCESS
1. Generation of buying motive:- Consumer feels a need
for buying a two wheeler.
2. Awareness about existing products:- Consumer collects
sufficient knowledge about the bikes in the market.
3. Knowledgebase validation:- Consumer checks or verifies
the knowledge he has collected about the two wheelers.
He may ask his friends, relatives etc.
4. Attitude Generation:- Consumer may generate a positive
or negative attitude for various bikes.
5. Evaluation:- Consumer here tries or evaluates the two
wheeler he likes personally.
6. Purchase:- if everything goes fine and satisfies the
consumer he goes forward for purchasing the two wheeler.

113
TEST OF HYPOTHESIS
• Manufacturers adopt a holistic approach for marketing
their products.
The manufacturers try their best to market their
product. But a holistic approach is not being used presently.
This can be seen by the fact that manufacturers do differentiate
marketing on national and international basis. This may be
working well at present but doesn’t have future prospects. To
compete with the foreign brands entering Indian market a
holistic approach is required.
THUS THE FIRST HYPOTHESIS IS NOT
VALID.
• Good communication doesn’t exist between the
consumers and the two wheeler manufacturers.
Proper communication is required in each and every
field. Problems like spare parts shortage, non availability of
products, unsatisfied consumers make it clear that there is no
good communication between the consumer and the
manufacturer.
THUS THE SECOND HYPOTHESIS IS
VALID.

114
More concentration of the two wheeler manufacturers
on the consumers is required. The Indian two wheeler market is on
its way for development and is ready to face situations like
globalization. Manufacturers must harness this golden opportunity
as soon as possible. The global competition is tough and thus a
holistic approach is required. Advent of indigenous technology by
the manufacturers is taking place and thus they should be
encouraged both by the government and the society.
Hence by the above research it can be concluded that in
Indian Two Wheeler market Consumer Behavior plays a very
important role. Establishment of proper communication channels
with the consumers and sophisticated marketing strategies is a
requisite for the development of this sector.

117
SAI SERVICE STATION LTD. (PHUGEWADI)

118
BAJAJ PRO BIKING SHOWROOM IN PUNE
Mr Rahul Bajaj (centre), Chairman, Bajaj Auto, Mr Sanjiv Bajaj (left), Executive
Director, and Mr Rajiv Bajaj, Managing Director, at the launch of the Probiking
showroom in Mumbai on Tuesday. — Shashi Ashiwal
Pune , Sept. 6
PROBIKING is only the tip of the iceberg. What we are planning is to have specialised
channels for our vehicles and we have identified four such channels," said Mr Rajiv
Bajaj, Managing Director, Bajaj Auto Ltd (BAL), after the inauguration of the first
probiking showroom in the city.
He also said that the company is aiming to open 10 such showrooms across the country,
he said. Probiking showrooms are designed to give the customer a complete feel of the
product they are buying.

119
He said that the company was all set to restructure its entire dealership network across the
country.
Mr Bajaj said that the probiking showroom has been designed for the biking enthusiasts
and the showroom offers prospective `probikers' a chance to test-ride the bikes on
specially-designed, indoor dynamometers.Asked whether all showrooms would be
company-owned or dealerships, he said that BAL would try to understand the channel
and then decide on the mode.
Spread across an area of 2,300 sq ft, the centrally-located showroom has a specially-
designed, indoor dynamometer for a static test-ride, wherein riders would be able to put
the bike through the ultimate driving conditions and check out parameters such as
acceleration, time, power, torque, top speed etc, which is not possible on a normal road
test, he said.
He also said that technology would be the nucleus of the probiking chain of showrooms
with every showroom's local server connected to BAL's central SAP (ERP) system.
Interactive computer terminals would provide hassle-free self-service transactions
wherein the probiker could also print quotations, book test-rides and order the bike.
He said that probiking would also take post-sales to the next level. A chain of off-site
service facilities is being set up for probikers such as smart cards, special vans that would
offer doorstep pick up and drop and a lounge in the service area to enable the probiker
see his vehicle being serviced.
Commenting on the probiking experience, Mr Bajaj said that the showroom, which was
soft-launched a month ago, has seen sales of about 150 bikes, purely on word-of-mouth
basis.
"We have realised that instead of spending huge amounts of money on advertising and
bringing in sales, it would be much better to give customers the option of having `see and
feel'.
We are trying to move from a push-based need, where we tell the customers that we have
different products at attractive prices, to a pull-based need, where we offer the customers
better products at comparative prices," he said.

120
HRITIK ROSHAN, THE BRAND AMBASSADOR
FOR HERO HONDA
Hritik Roshan at Just 4 Ladies showroom featuring the new Hero
Honda scooter ‘PLEASURE’
Hritik Roshan being
presented the 15 millionth Hero Honda bike ‘All Chrome
KARIZMA’.

121
JOHN ABRAHAM, THE BRAND AMBASSADOR
OF YAMAHA, INDIA
John Abraham at the Yamaha Fazer launch

122
YAMAHA FAZER 1000CC, IN IT’S PIMPRI-
CHINCHWAD SHOWROOM

129
1. C. R. KOTHARI, “RESEARCH
METHODOLOGY”, NEW AGE
INTERNATIONAL (P) LTD., PUBLICTION
REPRINT 2005
2. DR. P. C. PARDESI, “RESEARCH
METHODOLOGY”, NIRALI PRAKASHAN,
PUNE 2003
3. ‘MARKETING MANAGEMENT’ BY PHILIP
KOTLER.
4. “SERVICE MARKETING” BY M. K. RAMPAL
AND S. L. GUPTA
5. E- BOOK ON INDIAN TWO WHEELER
MARKET.

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