1

PROJECT REPORT
ON

CONSUMER PERCEPTION STUDY WITH RESPECT TO

MAHINDRA &
MAHINDRA SCORPIO
2

CERTIFICATE

The project entitled “CONSUMER PERCEPTION STUDY WITH RESPECT TO

“MAHINDRA & MAHINDRA SCORPIO” is Hereby approved as a bona fide work
carried out and presented by HARMEET SINGH in a manner satisfactory a warrant it
acceptance to the degree after which it has been submitted. It is understood that by this
the undersigned do endorse or approve any statement made, opinion expressed or
conclusion drawn therein, but approve the project work only for which it has been
submitted.

SIGNATURE OF THE TEACHER

3

ACKNOWLEDGEMENT

I wish to extend my deep sense of gratitude to my guide Mrs. ANJALI SHARMA for
providing me with valuable guidance and motivation to make the project work as a
highly useful and knowledge based experience.
Last but not least I would like to thank all the faculty members of SBS, GURGAON and
friends who in one way or other helped me in bringing out this research as a successful
one.

HARMEET SINGH
ENROLLMENT NO.09781761110
4

ABSTRACT
The automobile industry today is one of the most lucrative industry. Due to the increase
in disposable income in both rural and urban sector and easy finance being provided by
all the financial institutes, the passenger car sales have increased at the rate of 25%
per annum in June 2008-09 and at the rate of 37% per annum in june 2009-10 . Further
competition is heating up in the sector with a host of new players coming in and other
like Porsche, Bentley, Audi, and BMW all set to venture in the Indian markets. One
factor that could help the companies in the marketing of their product is by knowing and
creating a personality for their brands. An attempt could be taken to answer some of
the questions regarding brand personality of selected cars in India by conducting the
market research. This comprehensive study is categorized into parts, deals with
introduction to brand personality, companies selected, product and the industry.
One factor that could help the companies in the marketing of their products is buying
behavior of the consumers. The Buying Behavior of the customers can be studied by
knowing their perceptions about the cars in the market and about the possible entrants
in the market. One such technique is by knowing and creating a personality for the
brands. This personality sketching will help in knowing what a customer (or a potential
customer) thinks about a given brand of car and what are the possible factors guiding a
possible purchase. Similarly, the idea of measuring the customer satisfaction will serve
the same purpose of determining the customer perception. Thus, by measuring the”
willingness of existing users of a car to recommend it to others” will help the car
manufacturers to chalk out the entire Customer Buying Behavior.
The thesis shall attempt to answer some of the questions regarding “how to increase
passenger car sales”, specially talking about our own Indian automobile company
Mahindra and Mahindra. By conducting a survey we could know the brand personality
of selected cars in India and many more factors which could increase the passenger
car sales. The market research will be helpful for the new car entrant companies in
India as well to find out the possible gaps between the customer expectations and the
present market offerings. This way Mahindra and Mahindra automobile Ltd will be able
to increase their share in the ever-expanding Indian market pie.
The research will track the customer satisfaction in the following two layers:
Product related Parameters &Dealers related parameters
The customer satisfaction index will be calculated for the car brands taken into
consideration. It will be mainly a primary research and the information will be gathered
from both primary and secondary research. The study will analyze the applicability of
existing research concepts, theories, and tools for evaluating consumer satisfaction.
5

TABLE OF CONTENTS
1 Abstract 2-3
2 Signatory Page 4-7
2 Acknowledgements 8
3 Table Of Contents 9
4 List Of Figures 10-11
5 List Of tables 11
5 Thesis Synopsis 12-13
6 Introduction 14-18
7 Overview of Auto Segment 19
8 Size And Share Of The Automobile Market 20-28
9 Company Profile & Logistics 29-48
10 Brand Personality 49-58
11 Objectives of Study & Objectives of Research 59-62
12 Research Methodology 62-63
13 Findings & Analysis 64-89
14 Recommendations 90-92
15 Conclusion 93-94
16 References 95-102
6

LIST OF FIGURES
Serial No. Figures Page No.
1 Major attributes of customer satisfaction 16
2 The buying Process 17
3 Three core elements of satisfaction 18
4-5 Indian Automobile Industry size& Indian 21
Automobile Industry product
6 Indian Automobile Manufacturers in India and 23
Plant Locations
7 Automobile Manufacturers Market Share 25
8 Domestic Sales of Cars 28
9 Information of Flow of supply chain 31
10 Showing the demand forecasting 32
11 Central Production and Planning Control 34
12 Inventory management 42
13 Showing the cost management 43
14 Research Project Steps 62
15 Motives of buying a car 64
16 Product specific reasons for buying a car 66
17 Liking for the interiors of the segment B cars 68
18 Cars interior’s parameters 69
19-20 Safety parameters of different cars 71-72
21-22 Car fuel efficiency parameters 73-74
23 Top speed of family car 75
24 Availability of parts of family car 77
25 Dealer related parameters for different 80
manufacturers
26-27 Brand image of the cars & perception of 81-82
different cars
28 Customer action :recommending car to friends 83
29 Segment wise customer perception 84
30 Demographic: Age wise perception 85
31 Monthly family income 86
32 Respondents objective buying a car brand 87
33 Recommending a car to your friends 88
34 Respondents ranking of brand and company 89
image

LIST OF TABLES
Serial No. Tables Page No.
1. Explains the growth of India Car Sale. 26-27
2. Replies of the company as people 50
7

Chapter-1
INTRODUCTION
It is true fact that if you are satisfied you recommend to others. Word of mouth and
customer satisfaction play a very important role in determining market perception about
an automobile. It is the market perception that determines the success of a company
and so it is very important for the car manufacturers to measure the “willingness of
existing users of a product to recommend it to others”. The same is a lot of interest to
customers as well for it helps them make the purchase decision. A car is one of the
most significant purchases that an Indian household makes and this thesis addresses
the most important question that perplexes car manufacturers:
“What makes the perfect car and how to increase the sales of the Mahindra and
Mahindra’s passenger car ?”
The thesis highlights the factors that influence the buying decision of a consumer.
The factor under consideration would be:
Price
Income of the consumer
Features in the car
Safety standard
Warranty scheme
Finance facility
Re-sale value
Sturdiness and Looks
Is an Indian consumer ready for more? Which is the driving motive behind the effective
demand of the car? How the coming of new models like Honda’s Jazz is going to effect
the buying decision of consumer and especially the Tata 1 lakh car. In other words,
from the spread of choices offered by various manufacturers under various segments,
of which one the customer will finally turn the ignition on and drive. Customer
satisfaction index: some of the most advance thinking in the business world recognizes
that customer relationships are best treated as assets, and that methodical analysis of
these relationships can provide a road map for improving them, as somebody has said
if you cannot measure it, you cannot improve it.
As one of the measurements of the performance of the quality management system,
the organizations shall monitor information relating to customer perception as to
whether the organization has met customer requirements. The method for obtaining
and using this information shall be determined. The requirement has been there in the
QS9000 standard clause 4.1.6 which says:
“Trends in customer satisfaction and key indicators of customer dissatisfaction shall be
documented and supported by objective information. These trends shall be compared
to those of competitors, or appropriate benchmarks, and reviewed by senior
management.”
There is obviously a strong link between customer satisfaction and customer retention.
Customer’s perception of service and quality of product will determine the success of
the product or service in the market. With better understanding of customer’s
perceptions, companies can determine the actions required to meet the customer’s
needs. They can identify their own strengths and weaknesses, where they stand in
8

comparison to their competitors, chart out the path future progress and improvement.
Customer satisfaction measurement helps to promote an increased focus on customer
outcomes and stimulate improvements in the work practices and processes used within
the company. Customer expectations are the customer-defined attributes of your
product or service. We cannot create satisfaction just by meeting customer’s
requirements fully because these have to be met in any case. However falling short is
certain to create dissatisfaction. Major attributes of customer satisfaction can be
summarized as:
Product quality
Product packaging
Keeping delivery commitments
Price
Responsiveness and ability to resolve complaints and reject reports
Overall communication, accessibility and attitudes

Values

+ Benefits -

Features - Attributes

Figure-1: Major attributes of customer satisfaction

We cannot begin to address the customer satisfaction issue we define the parameters
and measures clearly. The customer satisfaction index represents the overall
satisfaction level of that customer as one number, usually as a percentage
9

The buying process involves the following steps:

Problem Recognition

Information search

Evaluation

Decision

Buy

Post Purchase
Dissonance

Dissatisfaction = Satisfaction = Brand

Brand Rejection Acceptance

Figure-2

“The fact that word of mouth sales are a big deal in this industry has also helped.
Industry players and market surveys reveal that 20-30 percent of sales are through
word of mouth”.
For knowing: How to increase passenger car sales ,it has undergone through following:
Surveying the relevant consumer base through exhaustive questionnaire.
Understand the elements underplaying in each segment
Deducing an analytical overview through different statistical methods
Recommendation comes from satisfaction and satisfaction comes from
10

Figure-3: Showing three core elements of satisfaction

OVERVIEW OF THE AUTO SEGMENT

Indians have emerged as an avid car enthusiast sporting their prized possessions as
status symbols and speed machines. Foreign car companies have discovered the
Indian consumer as well as the R & D potential in the Indian technical fraternity and are
setting up manufacturing plants right and left across the country at lower costs. The
Indian automobile industry is currently experiencing an unprecedented boom in
demand for all types of vehicles. This boom has been triggered primarily by two factors:
Increase in disposable incomes and standards of living of middle class Indian families.
The Indian government's liberalization measures such as relaxation of the foreign
exchange and equity regulations, reduction of tariffs on imports, and banking
liberalization that has fueled financing-driven purchases.
Industry observers predict that passenger vehicle sales will triple in five years to about
one million, and as the market grows and customer's purchasing abilities rise, there will
be greater demand for higher-end models which currently constitute only a tiny fraction
of the market. These trends have encouraged many multinational automakers from
Japan, U.S.A., and Europe to enter the Indian market mainly through joint ventures with
Indian firms.

India is increasingly becoming a global automotive hub both for the vehicles and
component industry. India is fast integrating itself into the world economy and open to
international automotive companies, who are increasingly investing in India. The Indian
automotive and component industry is looking to increase the quality of production from
existing levels, to develop new products and to increase exports. In the long run India is
well set to become a key market for automotive and component manufacturers in terms
of local demand and as a base for export. Additionally, companies such as GM,
Daimler Chrysler, Toyota, Delphi and MICO/Bosch are utilizing India’s well developed
IT / software capabilities and have set up R&D hubs here for their global operations.
11

INDUSTRY SIZE
The domestic Indian passenger car market (including utility vehicles) totaled900,000
units (with a CAGR of 10 per cent over the past 4 years) while the exports were
130,000 million units (with a registered CAGR of 68 per cent over the past 4 years)
during financial year 2004
The Indian two-wheeler Industry is one of the largest in the world, and is expected to
maintain robust growth in the future
At the back of this phenomenal automotive growth is the success of the Indian auto
component industry. Presently a US$ 6.7 billion industry, it is expected to almost treble
in less than eight years time to US$ 17 billion by 2012
India offers a distinct technological and cost-competitive advantage, which global
Original Equipment Manufacturers (OEMs) and automotive suppliers are leveraging for
both manufacturing and research facilities.The passenger car market is projected to
grow at a CAGR of 12.3 per cent over the next few years. Growth in the mid-size and
premium car segments is expected to outpace the overall market growth.

Figure-4: Indian Automobile Industry size

12

Figure-5: Indian Automobile Industry Products

Automobile Industry in India is still in its infancy but growing rapidly. The opportunities
in the automobile industry in India are attracting big names with the big purse and they
are investing vigorously in infrastructure, design and development, and marketing.
Automobile industry in India is today poised for the big leap.

India is the 2nd largest two wheeler manufacturer in the world

Second largest tractor manufacturer in the world
5th largest commercial manufacturer in the world
3rd largest car market in Asia, surpassing China in the process

Automobile industry Contributes 17% of the total indirect taxes collected by the
exchequer & is a driver of product and process technologies, and has become a
excellent manufacturing base for global players, because of its

high machine tool capabilities

Extremely capable component industry
Most of the raw material locally produced
Low cost manufacturing base
Highly skilled manpower
Special capability in supplying large volumes

Domestic and Foreign Vehicle Manufacturers:

Figure-6: Indian Automobile Manufacturers in India and Plant Locations

Passenger Vehicles

The main domestic manufacturers of passenger vehicles are as follows:

Maruti Udyog
Tata / Telco
13

Mahindra / Mahindra
Hindustan Motors

Foreign competitors manufacturing locally including Hyundai, Ford, General Motors,

Honda, and Toyota.

Car demand has seen a turnaround since mid 2001 thanks to heavy discounts and
cheaper finance. A large number of new models, both locally assembled and imported,
have also revitalized the market.

In terms of volumes:

The A/B segments are where India’s strength and future lies. The A/B segment
accounts for over 65% of the total passenger vehicles produced. Competition in this
segment is stiff with Maruti the market leader with around 55% market share. New
models from Telco (Indica), Hyundai (Santro) and Fiat (Palio) however are eroding
Maruti’s long standing dominance in this segment.

The mid / luxury range is developing with the introduction of Ford (Ikon), Hyundai
(Accent/Sonata) and Skoda (Octavia), although the volumes are not significant.

The UV segment remains sluggish with growth at just over 1%. The clear market
leader, Mahindra (51.5% market share) posted increased sales of 16% in the first 3
quarters of 2007/08. Toyota and Telco domestic UV business remains flat.

Commercial Vehicles

The main Indian companies in the Commercial Vehicle segment are:

TATA Engineering and Locomotive Company (TELCO)

Ashok Leyland
Bajaj Tempo Ltd
Eicher Motors Ltd
Swaraj Mazda

An international company currently manufacturing CVs in India, such as Volvo but

again volumes are not large. Other global players are active, although in partnership
with one of the domestic manufacturers E.g.:- IVECO (manufacturing their range of
trucks in association with Ashok Leyland. There has been a significant turn around in
this segment over the last 18 months with over 30% growth being seen in terms of both
production and sales.

This sector has received a huge boost with India’s massive demand from the
infrastructure sector (particularly roads), cyclical fleet replacement by fleet owners and
an upturn in the cement and steel sectors.
14

Passenger Cars LCV

0.604 Mn0.083 Mn

Bajaj Tempo Eicher HM

Ashok 7% 8% 2%
M&M
Leyland
30%
1%

Sw araj Mazda
Tata
8%
44%

Hyundai
18%
Tata
13%
Fiat
4%
Ford
3%

HM
2%
Maruti
55% Toyota Honda
0.3% Daimler
GM 2%
Chrysler Mitsubishi
Skoda 1%
0.2% 1% 1%

Figure-7: Automobile Manufacturers Market Share

15

Maruti (JV of Suzuki), leading the market,

Tata and M&M are the key players
Followed by Hyundai and Tata, together hold close to 75% of market
Daewoo stopped production, mainly due to financial issues
The following Table-1, explains the growth of India Car Sale during the aforementioned
period.
Passengers From From Total The Net Total
Vehicles (PVS) April- April- Market Change number of
November November Share between the exports in
04-05 05-06 (in %) period (in April 05-
%) 06
Maruti Udyog 2,69360 2,91,182 52.2 8.1 23,043
Hyundai Motors 89,075 1,07, 066 19.2 20.2 68,374
India Ltd.
Tata Motors 95,402 24,348 16.6 -2.7 12,105
HondaSiel cars 23,186 24,348 4.4 5.1 31
India Ltd.
Ford India Pvt. 15,026 10,512 1.9 -30% 9,928
Ltd
Utility Vehicles
Mahindra and 49,897 51,540 42.7 3.3 1,878
Mahindra Ltd.
Toyota 24,404 24,983 20.7 2.4 0
KirloskarMotorPv
t Ltd.
Tata Motors Ltd 19,967 21,610 17.9 8.2 905
General Motors 7,008 12,027 10 71.6 0
India Pvt Ltd.
Maruti Udyog Ltd 2682 2472 2 -7.8 54
.
Hyundai Motor 255 1,042 0.9 308.2 0
India Ltd.
Multi-Purpose
Vehicles
Maruti Udyog 42,388 43,858 100 3.5 731
Ltd.
Mahindra & 13 0 0 0 0
Mahindra Ltd
Medium and
Heavy
Commercial
Vehicles
Tata Motors 79,614 73,538 61.1 -7.6 4,807
Ashok Leyland 27,577 33,406 27.7 21.1 2825
Eicher Motors 8,043 8,700 7.2 8.2 318
16

Swaraj Mazda 3,573 4,080 3.4 14.2 115

Light Commercial
Vehicles
Passenger
Carriers
Tata Motors 5,835 6,811 46.8 16.7 1,096
Mahindra and 2,305 1,960 13.5 -15 115
Mahindra
Swaraj Mazda 1,178 1,315 9 11.6 12
Force motors Ltd. 2,059 2,877 19.8 39.7 59
Goods Carriers
Tata Motors 30,955 44,380 58.9 43.4 12,461
Mahindra and 23,563 23,731 31.5 0.7 1,600
Mahindra
Swaraj Mazda 2,671 2,299 3 -13.9 204
Eicher Motors 3,019 2,954 3.9 -2.1 451

Figure-8: Domestic Sale of Cars

17

Chapter-2
COMPANY PROFILE
M&M AUTOMOBILELTD

Mahindra & Mahindra Limited (M&M) is a major automaker in India. It is the flagship
company of the Mahindra Group. The company was set up in 1945 as Mahindra &
Mohammed .It traded steel with suppliers in England and the United States. M&M
began by assembling complete knock down (CKD) Jeeps in 1949.It expanded to
indigenous manufacture of Jeep vehicles with a high level of local content under
license from Kaiser Jeep and later American Motors (AMC).

M&M soon branched out into manufacturing agricultural tractors and light commercial
vehicles (LCVs). It later expanded its operations to secure a significant presence in
many more important sectors. The company has now transformed itself into a group
that caters to the Indian and overseas markets with a presence in vehicles, farm
equipment, information technology, trade and finance related services, as well as
infrastructure development.

By 2005, M&M had become the largest producer of SUVs in India. The company has
recently started a separate sector, the Mahindra Systems and Automotive
Technologies (MSAT), to focus on developing components and offering engineering
services
18

In this thesis I have tried to describe how M&M has modified the structure of the
organization in order to implement a successful supply chain. The different processes
and initiatives taken across the supply chain of M&M have been described below. M&M
has obtained operational efficiency by keeping a constant watchful eye on the
developments on the supply chain. The endeavor of the company to reduce its costs in
order to increase the profit margins has been described.
M&M is the leader for Utility Vehicles in India today. The company has been in
existence since 1994. The company also has presence in the Light Commercial Vehicle
market. The company’s commercial three wheeler “Champion” does brisk sales in the
country. The company has six plants across the country. These plants are in the
following cities
Mumbai
Nasik
Igatpuri
Haridwar
Zahirabad
Chennai
The plant at Mumbai specializes in the manufacturing of pick-up trucks. Kandivali, a
suburb of Mumbai has a Mahindra plant devoted to the production of MAXX pick-ups
and soft tops .This plant enjoys the great infrastructure that the city of Mumbai offers. It
has also been recommended for the TPM Excellence Award apart from ISO/TS 16949
certification. Here forth I will put light into the various aspects of material management
with regards to M&M plant kandivli.
19

SCOPE OF MATERIAL MANAGEMENT IN M&M

The flow that has been shown below is the “flow of information”. The “flow of materials”
will be in a direction that is opposite to that of the flow of information. Hence the flow of
materials will start with the suppliers and the final product, after assembling, will reach
the dealers.

Figure-9: Information of Flow of supply chain

M&M uses SAP to keep track of the events that happen across the supply chain.
According to the design it is imperative for every dealer to record the sales that have
been achieved on a particular day on to the system. M&M hence is taking a major
initiative to make all of its dealers SAP enabled. For the dealers who do not have the
access to SAP it is mandatory to report the sales of the previous day to the marketing
office every morning. In such a manner all the regional offices get the figures from the
dealers everyday. All the regional offices will then send these figures to the Marketing
Head Office at Worli. Here firstly, the dealers stocks are replenished. Proper delivery of
the products to every corner of the country where demand exists has to be seen by the
marketing department. Marketing also has to indulge in “demand forecasting” so that
the production planning can be carried out effectively. This data is available for a
number of years. The marketing department has to track all the data over the years,
considering sales achieved in the past for the particular month for which forecasting is
being done. Then by tracking the data and then incrementing the sales which are
expected considering the growth rate the marketing department comes to a figure. This
is the figure that is forecasted and passed along. Then based on the demand and the
expected growth the expected sales are calculated. Also based on the figure obtained
from the marketing department the production planning and the further processes are
carried out. This is one of the most important functions of the marketing department.
20

From the supply chain point of view this is a very essential and an indispensable
function. It is the marketing department that will give the figures for production to the
production department.
Why is Demand Forecasting an Important Element in the Supply Chain ?

Figure-10: Showing the demand forecasting

Every organization wants to maximize its revenue and minimize cost to achieve
optimum profitability. Revenue can be increased by increasing the per unit price of the
vehicle and selling at the existing quantity or by selling more vehicles at the same price.
However if the production of the vehicles happens at a rate that is faster than the rate
of sales then the finished good inventory will keep on increasing and the money
invested in the production of the vehicles will not get its returns in the form of sales. If
the rate of production of the vehicles happens at a rate that is lower than the demand in
the market then it might result in the loss of a sale as the customer might buy a
competitors product as the product that he wants is not available. Also apart from the
customer himself the distribution network of the company would start losing faith in the
company and this would lead to dilution of the companies brand image internally and
externally too (due to bad publicity by the customers lost).
Also an important fact to be seen here is that the manufacturing costs of a vehicle are
very high. So in turn the inventory holding costs will also go up considerably
However automobiles are not a low involvement product. A person will not buy an
automobile everyday For companies who have products which have low cost of
production it makes sense for them to stock their products in to the market as the
inventory holding cost per unit would be low.
PRODUCTION PLANNING AND CONTROL
The marketing department at M&M passes the expected sales figure to the Central
Production and Planning Control (CPPC). The function of the CPPC is to take the
projected figure from marketing and then break it up in to aggregates.
21

Figure-11: Central Production and Planning Control

CPPC: The CPPC will take the individual figures for each of the vehicles and break
them up in to numbers for various parts required for production. These break ups are
released by the CPPC on a monthly basis. The monthly plans are released to the
departmental PPC’s.
PPC: The departmental PPC’s play a very vital role as they are the one’s who will carry
out the further break up and pass it along to the procurement team. Thus the figure
received from the CPPC is then further broken up by the PPC according to the
requirement of the individual departments. The CPPC will always release the plans
according to the monthly requirement while the PPC has to break them down and
proceed with the weekly or the fortnightly requirements for the parts. The PPC’s will
then inform the procurement team as well as the logistics team about the scheduled
quantities.
The role of the departmental PPC is very important as he has to interact with
CPPC
Procurement team
Production (Shop floor)
The role of the PPC is to inform the CPPC about the product availability and the
available of production capacity. It will also communicate those particular components
which require further production. Based on this the numbers given by the CPPC and
hence the exact numbers required for production will alter. The PPC will then take
inputs from the CPPC and release weekly or fortnightly plans. The PPC releases the
plans based on the responsiveness or efficiency required from the particular vehicles.
PROCUREMENT TEAM: Once the figures and the production plans have been made
the details then have to be passed on to the procurement team. They then have to
ensure the smooth procuring of materials and also the efficient delivery so that the
inventory levels are maintained.
PRODUCTION SHOP FLOOR: The production department plans production based on
the figure given by the marketing team.
Actual production of the vehicles is handled by production. The production department
has to consider a lot of factors when the production planning is done. At every stage
the costs are minimized by introducing various methods. The production department
has to regularly track the inventory levels, reduce the defects, increase productivity and
also ensure proper output of vehicles according to the demand in the market.
SCM of M&M Kandivli
The four drivers of SCM in Kandivali are:
22

Procurement cell
logistics cell
Material disposal cell
PPC
Thus SCM is divided on basis of functions i.e:
Procurement cell
The departmental PPCs break up the quantity depending upon whether it is required
for a week or a fortnight and communicate it to the procurement team. The PPC will
give in a firm schedule and a tentative one. The firm schedule will not be altered in any
case and the tentative schedule might change a little. This is done in order to give the
suppliers the information about what stock might be needed at which particular point in
time.
At this point the vendor response cycles will start. The procurement team will
continuously communicate with the suppliers and keep the flow of materials smooth.
Any breakdowns or irregularities in the material flow will be managed by the
procurement team.
It is also the responsibility of the procurement team to set inventory targets for each
type of part. Daily the reports are tracked and the inventory levels monitored so that
production time is not lost due to the non availability of materials.
The procurement team will also communicate with the suppliers on behalf of the
individual departments so that only they interact with the suppliers. The communication
channel of the procurement team is shown in the diagram. The procurement team is
always on the lookout for new suppliers and also the optimum size to be given to each
supplier to maintain a proper balance of inventory supplier scheduling and supplier
capacity.

A few years ago each of the production units at M&M was a business unit and hence
the procurement of materials would be handled by each department individually. This
meant that if a supplier was common to two or more units then there would be multiple
people interacting with him for the material. Also it meant that the costs would rise up
23

as each unit would have their own logistics and ordering costs. The inventory
management was also done by the individual units.
The structure has changed and today the SCM team has a representative from each of
the production unit. One person will keep track of parts of similar type. He will
communicate with all the suppliers who provide that part. There is one person who
coordinates between all the buyers (employees) and he is the one responsible of
keeping track of the inventory and generating reports. Inventories are being greatly
reduced in M&M and this has ensured profitability by reducing the inventory carrying
costs.
Logistics
The logistics for M&M is handled by a dedicated company called “Mahindra Logistics”.
The function of the logistics department is to negotiate terms with the contractors and
co-ordinate with the transporters as to where the materials are and when will they
arrive at the factory premises.
Allocating the vehicles to particular parts and products has to be done by the logistics
department.
Free delivery
In a free delivery format the supplier will bear the transportation and the logistics costs.
The company does not have to pay for the delivery from its own pockets and hence the
onus will be on the supplier to reduce his costs.
Ex-works-Here the costs of transportation of the goods are taken up by the company.
The company will arrange for the transporter and keep track of the materials in transit.
The logistics was earlier looked upon by the Transport and Solutions Group (TSG).
This group has been made in to a separate company called Mahindra Logistics.
Milk Runs

Milk run deliveries are deliveries that bring products from multiple originating locations
to a single receiving location. Scheduling milk run deliveries is a much more complex
task than scheduling direct deliveries. Decisions must be made about delivery
quantities of different products, about the frequency of deliveries, and most importantly
about the routing and sequencing of pickups and deliveries.
Outbound logistics
Outbound logistics deal with the finished vehicles reaching the dealers. There are three
ways by which a vehicle can reach the dealer
By road (Convoy)
By car carriers
24

By rail
3. Material disposal cell
Currently responsible for scrap contract finalization for 3 plants (Kandivli,Nashik and
Igatpuri).
Compared to last year there was 42% increase in revenue generation of scrap (773
lacs for the period of Apr-06 to Dec-06 against 543 lacs in the same period last year)
4. PPC – it has been explained above in the planning stage.
Vendor development
Vendors are considered the best intangible assets of any manufacturing organization.
Hence both new and established vendors are subjected to a crucial evaluation to
review their plant capacity, financial conditions, performance, etc
Mahindra and Mahindra is an automobile industry manufacturing utility vehicles
requiring 4500 parts to be assembled. These parts are procured from a large pool of
suppliers scattered all over the country. So it is needless to say about the importance of
vendor in this organization.
Vendor selection
Just as in any manufacturing organization vendor development starts from vendor
selection. As Mahindra and Mahindra being a 62 year old company, it has a large
supplier base. This supplier base has been gathered over these years by the purchase
personnel identifying the potential supply sources.
Key supplier
In M & M every raw material/part/component that they purchase has two key suppliers.
The supplier offering the best quality at lowest price and adhering to the delivery
schedules is selected as the key suppliers. The first key supplier supplies
approximately 60% of the material requirements and the other key supplier provides for
the remaining 40% of the materials. They have two key suppliers because 1 supplier
does not have the production capacity to meet the requirements of the company. As
also in case of shortfalls, emergency it is essential to have two key suppliers instead of
one.
Vendor evaluation
It is essential to evaluate the vendors on various grounds as the qualityof the finished
product-(in this case vehicles) will finally depend on the quality of raw material.
Vendors are evaluated on the following basis:
Delivery schedules- in case of Mahindra and Mahindra they maintain inventory
according to the rolling plans i.e weekly plans. So vendors need to supply materials at
fixedand predetermined schedules. So vendors are evaluated on the basis of how
efficient they are in adhering to the delivery schedules.
Quality – in an automobile industry if the quality of the raw materials like the grade of
sheet-metals, fabric,plastic, etc is not as prescribedthe final producti.e. the quality of
the vehicle produced will be hampered. So assuring that the quality of raw materials is
as per the requirement it is absolutely essential to evaluate vendors on this ground.
One way what M&M follows is a six sigma quality check analysis on the bought out
parts and evaluate the vendor based on defects inparts per million.
Lead time- According to the classification of raw materials different categories require
different lead times. For example a product classified under ‘AX’ category should have
the least lead time and a product under ‘BX’ category would have a relatively higher
lead time. The vendors have to comply with the specified lead times given to them by
25

M&M. So a vendor is evaluated on the basis of the lowest lead time offered and how
efficiently does he adhere to the lead time agreed upon by both the parties.
Flexibility- The vendor is evaluated on the basis of his flexibility to adjust with any
changes in the quantity, delivery schedule and or product/service design.
Vendor rating
In M&M they do not have a vendor rating method as such provided that they have such
a large supplier base it is difficult to rate them and they believe it to be an added cost to
their balance sheet.
Vendor motivation
M& M tire to motivates it’s vendors by arranging for vendor meets wherein an official
from M&M visits the vendors factory and appreciates them if satisfactory and tries to
resolve issues with vendors if any. It also arranges for rewards and recognition wherein
the top 10 suppliers are awarded. As also shares are given to the suppliers as a token
of appreciation. This helps a lot in developing good supplier-buyer relationship.
INVENTORY MANAGEMENT
Managing inventories is absolutely essential for any company. Improper ordering can
eat in to the profits by increasing the inventory carrying costs. But if there are not
sufficient inventories it might result in to the loss of production for a firm. Hence
inventory management is given so much importance.

Figure-12: Inventory management

Each upstream element in the supply chain not only aggregates the inflated demand
changes of all the elements fed by it but also overreacts to these demand changes and
adds its own safety margins to take care of perceived fluctuations in future demand
from downstream elements.
This helps the company in maintaining the right levels of inventory and hence prevents
excessive investment of money in the raw materials. Apart from reducing the carrying
costs this also means that the company has more money to invest and more liquid
cash at their disposal.
Total Productive Management:
A few years ago M&M was experiencing a lot of production loss due to non-availability
of materials. While some of the material was not available other materials were being
excessively stocked. This resulted in very high inventories of materials. It was also
observed that the costs of buying the materials were very high and that in most of the
modules the company was overstaffed.
Hence it was decided by the company to implement TPM. TPM was introduced all
around the organization and all the employees were given guidelines which they had to
follow in order for the implementation of TPM to be successful.
In the initial phases the TPM activities were meant to focus on the following activities
26

Inventory reduction: Inventories were reduced by continuously measuring, monitoring

and reducing inventory levels. Techniques like Just In Time (JIT) were introduced to
maintain optimum levels of inventory and also to reduce the inventory costs
dramatically.
The following two methods were used in order to manage inventory levels better
Two Bin system
Kanban system
1) Material Cost Reduction:

Figure-13: Showing the cost management

There are two types of costs associated with materials these are
Cost of materials (cost of ordering): Costs of materials include basic price, packing
costs, taxes and freight.
Cost on materials (cost of carrying): Costs on materials include Procurement costs,
inventory costs and material handling costs
Manpower reduction
Manpower reduction was achieved through job clubbing, job elimination and layout
changes
This is a way to ease out excess people from the organization. Jobs can be modified so
that one person can take more responsibilities. Unnecessary processes can be
eliminated so that no employees are employed for carrying those out.
M&M has done precisely that when they stopped inspecting the quality of the material
coming in by putting more importance on the suppliers by making him accountable for
his products.
Economic Order Quantity:
EOQ for them is on full truck load basis. They see to it that no transportation vehicle
comes half empty and it is utilized to its full capacity. But while determining the EOQ
the inventory levels in the stores are also considered.
Material Requirement/Resource Planning (MRP-1):
It is a computer based information system designed in M&M to handle ordering and
scheduling of dependent demand inventories. Raw materials, components, parts, tools
required for the production of one particular part of the vehicle say engine or axle is
27

termed as dependent demand inventories. A production plan for a month of finished

products in the form of master production schedule is translated into requirements of
components parts and raw materials working backward from the due date using lead
times and other information hence, requirements of end items generate the
requirements for lower level components which are broken down by weeks so that
ordering production and assembly can be scheduled accordingly. Basis and input on
which MRP runs:
Schedules: M&M's area offices update the demand plan on a weekly basis. SAP-SCM
can take into account regional demand variation, using its optimizer capabilities to
decide which plants will make what and synchronizing the procurement schedules.
M&M runs supply planning capability based on the changing demand pattern, with
results transmitted to MRP and posted to the private vendor Web sites. This way the
suppliers can keep up-to-date on likely plant consumption. Vendors don't supply based
on this information – the rolling plan only alerts them to what they should be prepared
for. All material flow from the suppliers is pull based, triggered by actual consumption at
the plant end.
Physical stock- it is the stock that is being seen on the system and which should tally
with the physical stock in the stores of all the unused components, parts, tools, etc.
Bill of materials- for the production of any one part of the vehicle (engine, wheel, axle)
the number of raw materials used for its production will be reduced automatically from
the systems according to the number of units produced. The bill of materials is the
number of raw materials required for the production of 1 part of the vehicle. If for
example manufacturing an engine requires 450 parts but bill of materials accounts for
only 440 parts then the system stock and the actual stock would not tally leading to
shortfall in inventory.
Safety stock- it shows the number of raw materials which are more than the
requirement and available in case of emergency.
STORES MANAGEMENT
The store in M&M is decentralized with each production unit having their own stores. All
the stores in each of the units are next to the road so that loading and unloading
becomes easier. Also the materials can be protected from damage in this case.All the
bought out parts and work in progress inventories are kept in the stores.
The stores are divided into 3 sections depending upon its functions-
Receiving stores: the receiving stores is where the goods are received from the
vendors by trucks. The truck unload the contents at this area which is also called as
‘dock’. The trucks directly unload the contents into palates.
Main stores: main stores is where the raw materials are stored. The COMB type layout
is followed in the main stores.
Finished goods stores: finishedgoods stored in this case are the processed parts
which are manufactured in the respective production units. They are then taken to the
main assembly line for assembly.
Features of stores:
Stores are properly ventilated with tube lights and fans.
They use an instrument that measures luminosity in the evening. Accordingly more
lights are provided.
The materials are kept in racks.
Stock verification
28

Stock verification is done once a year on 31st January. On this day the production is
stalled, the entire SAP system is closed, material procurement and dispatch is halted.
All the employees from all the departments then engage themselves in stock
verification. Thus they follow fixed or periodic inventory method.
Stock valuation
They follow actual price method of stock valuation for raw materials wherein oldest
stock is issued first. In this method materials are issued at actual cost and are valued
also at the same cost by keeping an account of the receipt of all the raw materials.
Material handling
Material Handling Equipment in M&M traditionally consisted of trolleys, conveyors,
forklifts, overhead travelling cranes etc. These were primarily devices of Mechanisation;
a lot of manual intervention was involved. These had limitations like low speed,
handling problems like scratches, chipping, breaking, difficulty to monitor material flow
etc.
However, they were adequate in mass production with limited variety or low volume
production. Customers were tolerant of defects like scratches, dents etc. With
transformation of manufacturing systems to be lean, agile and highly automated, things
are changing. Increased competition increases variety of components (for product
customisation ), reduces lot size, varies product mix continuously ( pull type
manufacturing ).
Since the logistics now become complex, there is a tendency to INTEGRATE material
handling systems so that they can communicate with each other - as well as with
processing machines, inspection devices, assembly stations.
In M& M they have these aisles i.e roads constructed inside the plant for identification
of safe and danger zones
Red aisle: it is put for personnel/goods movement
Green aisle:it is put where machines/production/assembly takes place
Yellow: it is usually used as borders to distinguish clearly between red and green
aisles
Features of material handling
In M&M plant a mezzanine floor has been put up all over the stores and it is fire
resistant. It also helps in optimum usage of the floor space.
The concept of unit load is being depicted by keeping boxes of same materials under
palates and them systematically arranging them one above the other. Thus the number
of items or bulk material is so arranged that mass can be picked up and moved as a
single object. It helps in quick and easy movement of a lot of items than individual
items.
For glass equipments they a separate storage space.
According to them material handling equipment should be such that it helps in reducing
the manufacturing cycle time and minimum fatigue is required. Moreover they have a
stores department in each production unit which helps to reduce the material handling
costs.
Lastly for all the material handling equipments they give proper training to their
personnel to avoid any mishaps and to carry out safe operations.
29

MAHINDRA SCORPIO
“Nothing Else Will do”

First year of launch

8Scorpio to capture 22 per cent of the premium hard top market in F03 (9 months)
* Sell 12000 Scorpios in F03 (9 months)
*Mahindra unaided brand recall score to increase by 22 pts (defined in terms of Brand
Track study scores)
* Scorpio brand recall score to achieve 50 points (in W4)

Within three years of launch

* Scorpio to capture 45 per cent of the premium hard top market
* Scorpio to sell 24,000 units in F04
* Mahindra to emerge as a true urban player

Market Context
The soft tops sales, which were Mahindra’s strength, were stagnating. Hard top
vehicles like Sumo and Qualis were garnering market share. The urban market was
showing more potential for vehicle sales and UVs were gaining higher acceptability in
urban cities. The competition was getting tougher with international UVs entering the
market. And also operating in the urban market meant competing with cars.
The market was moving from traditional multi utility, non-luxurious vehicles to luxurious
vehicles. M&M had launched Scorpio in 2000 to cater to this newly emerging segment.
However, to add to the category’s woes, it declined at the rate of 3.1 percent in year
2001 over year 2000. UVs as a percentage of the overall passenger car market were
just 16 per cent in 2001. This simply meant that for attaining the volumes, Scorpio
needed to look beyond UVs in terms of competitive framework to decide on a
marketing strategy.

Competitive Context
The conventional UV market was too small in size. The UV market in urban markets
was even smaller a percentage. The trend was that the UVs operating in the urban
market were eating into the car share, primarily the cars which operated in the same
price bracket. Quails were taking market away from midsize cars. With these facts in
place the whole of automobile market was studied in details.
In the arena of cars, A-segment cars, which have been the leaders in terms of volumes
and grew at the rate of 55.2 percent in the year 1999, were having a reduced growth
rate of 34.2 percent in the year 2001. It was found that the fastest growing segment
30

(growing at the rate of 42.9 per cent) in year 2001 was semi luxurious cars or B
segment cars. And the luxurious car segment i.e. C segment cars were also growing at
a healthy rate of 14.2 percent in that year. However, super premium cars termed as
segment D and E cars, were not growing at such healthy rates and did not offer volume
in terms of number of cars sold.
It was imperative for Scorpio to look beyond UVs. Apart from appealing to a typically
UV buyer, it was also necessary to appeal to a wider target audience - prospective car
buyers belonging to 5 lakh and 5 lakh+ segment. The midsize car market (C class)
which was in the Rs. Five to Seven lakh price bracket had grown in F’00 at 36 per cent
and in F’01 at 22 per cent, and small luxury car segment (B class) which was up to Five
lakh segment was also showing a healthy growth.
Analysis showed that the volumes in the automobile industry were coming from B and
C segment cars. This meant that the mid size car market was the competitive arena for
Scorpio for it to attain the volume growth and market share it was looking for. It was
decided that the offer had to appeal to segment C buyer and should be aspirational for
segment B buyers. Therefore, an analysis of the offers of all the segment C cars and
the relevant UVs was done. The table below summarises the analysis:
Interpretations: All the vehicle are feature packed within a price range of Rs. 6-8 Lakhs.
All of them, including UVs, are with a proposition of luxury and comfort, with no
differentiation.
Implication: With this analysis it came out clearly that the positioning of Scorpio has to
be such that it should communicate that the vehicle is better than any of these cars and
is a better buy in terms of money.

Consumer Context
Having defined the competitive framework, the next task undertaken was that of
analyzing the consumer. Consumer segments of B and C category car buyers were
analyzed in terms of their expectations from a car, their perceptions about cars and
their relationship. Proprietary techniques of research, of the advertising agency
Interface Communications, like Mind & Mood, ICON and VIP were used to understand
this consumer. The findings were:
* Size matters- big size stands for status
* Consumers seek latest technology
* Imagery but at affordable prices
* The sheer thrill and passion of driving an SUV
* Power of the vehicle makes a statement
* But along with the others, luxury was a very important parameter
* International vehicles define imagery
Þ SUVs like Pajero, Land Cruiser and Prado are seen as urban vehicles for the rich
and famous
Þ Consumers aspire to own these vehicles as the imagery of these vehicles has
become very desirable
The Key Consumer Insight that emerged from all the consumer analysis and which was
used for strategy development was “Consumers want to consume premium imagery at
prices affordable to them”

Strategic Branding Approach - Identifying the need gap and occupying it

There existed a gap that wasn’t tapped. There was no SUV in the country that the
31

masses could buy. To make SUVs a mass concept in India - UVs needed to be seen
as comfortable, easy-for-city driving and should have imagery comparable to
international brands.
Therefore, as a strategy it was decided that Scorpio would not take the traditional UV
imagery of tough, off-roading and 4x4. A 4x4 approach would be a very niche category
and would not generate numbers. To appeal to a car buyer, the Scorpio needed to be
seen as a car that offers much more.
A Scorpio had to be seen as providing car-like driving pleasure and at the same time
providing the edge over cars in space, power, style, fuel efficiency, luxury and comfort.
In short, to provide status of a Pajero (international SUV) at the price of midsize car
The Scorpio product package offered - Superior technology, Dynamic Looks, Car-like
product and great value for the price
Value Proposition for Scorpio:
To capture the identified need -gap, the value proposition of Scorpio was defined as -

‘Car plus’
Rational benefits: World class vehicle, good looks, car like comfort, great value
Emotional benefits: Ownership experience of thrill, excitement and power
Relational benefits: Young modern, premium, city companion / extension of lifestyle.
Brand Promise: ‘Luxury of a car. Thrill of an SUV’
This brand positioning addresses the key consumer Insight and the product delivers the
promise. The position is also a unique proposition, which will help the brand have a
distinct image in the consumers’ mind.

Baseline - “Nothing Else Will do”

The baseline captures the essence of the brand, which is superiority and
uncompromising attitude. It also summarises the spirit behind the making of the
Scorpio.

Brand Strategy - Parent brand relationship

defining
A study of international brand names was done and a classification of brand names of
midsize cars and SUVs was done into groups. International brand naming trends and
strategies were analysed. New names were generated. These brand names were
researched massively first by qualitative techniques and then by quantitative
techniques.
The name that emerged as most popular, and which was also the most liked name
internally at Mahindra was SCORPIO.

Brand Endorsement Strategy

The relation between Scorpio and the mother brand Mahindra was also deliberated
upon. The strategy chosen for Brand Endorsement was - Scorpio from Mahindra -
shadow endorsement, one which does not shout “Mahindra.”
The Mahindra brand image was not modern and young. There was a need to create a
strong distinct modern brand. Hence Mahindra as a Masterbrand could not contribute
towards enhancing the Value Proposition. Yet Mahindra had to provide source
reassurance. Also the distribution would be through Mahindra dealerships. Hence it
became a shadow endorser.
32

Advertising and Promotions Strategy

The creative strategy was to drive home the ‘Car Plus’ positioning forward. There was a
need to leverage on product strengths. And a need to establish car plus story. Hence
the product was to be the hero in all communications
The tone and manner was to help associate the brand with the modern and urban
lifestyle. The TVCs as well as the press still-shots were shot in Australia to provide an
international city feel. This brought in the international, premium, up-market association
for the brand.

Media Strategy
Role of Media
*Dramatic and high impact launch
* High visibility
* Push brand image even by the media vehicle

Building impact through multiple-media

* PR, Mass Media, Direct Marketing, Events

Public Relations
Pre-launch excitement and buzz was created by a full blown PR program. Media
coverage on the IDAM process, the people behind the Scorpio, the obsession, the
world class technology, etc set the tone for the hyped up launch. PR was also the first
tool used for launching the Scorpio. The coverage of the launch was massive. It got
four cover stories

Mass Media
‘While the media targets would be achieved through the right selection of the media
mix, the Scorpio media posture was to ensure that Scorpio was present on the decided
media but ‘with a difference.’ Scorpio would use media innovations to create
differentiation on the traditional media and do things in a ‘bigger and better’ manner.

Customer Relationship Management (CRM)

CRM as a tool was used to create positive word-of-mouth, to monitor customer
experiences and generate referrals. A series of CRM activities were implemented with
regular direct communication, events and customer research. The CRM plan included a
welcome Pack on filling up Scorpio Club (Top Gear) form, satisfaction surveys, Events,
Festive offers, Rewards Program, etc.

Pricing Strategy: to be a premium brand yet

having universal appeal
Scorpio was to compete with the midsize cars like Hyundai Accent, Ford Ikon, Opel
Corsa, Maruti Suzuki Esteem on the one side and UVs like Toyota Qualis, Tata Safari
and the Tata Sumo on the other. Scorpio adopted the penetrative pricing strategy
positioned in the psychological price barrier of Rs. 5 -7 Lakhs.

Distribution Strategy - Serve less markets at a time but serve them well
Since the Scorpio was targetted at an urban clientele it needed a stronger ditribution
presence in Metros and urban areas. Hence, the distribution channel had to focus on
33

providing an appealing experience for modern car buyers and on offering international
standards of auto retail.

Phased Launch
The Scorpio was launched in a phased manner - first in Metros Mumbai, Delhi,
Bangalore, Chennai. Twenty cities were included over a period of 4 months and within
a year 50 cities were covered. This ensured attention to main markets and to ensure
that initial production of the vehicle could match demand. Dealerships were revamped
prior to launch in a particular city.

Showroom Experience
The showroom revamp was centred around the intention to provide a uniform customer
experience at all the touch points and to provide the customer with a unique
“experience” and not just a “product”. Therefore the back office would remain outside
the customer’s line of vision because the customer would be concerned with the
product and not with the paperwork.

Infrastructure
Thirty-five showrooms across the country were redone entirely with the same look and
identity and a décor built around movement, technology and sportiness. The theme
focussed on giving the customer a memorable experience.

Response - The strategy delivered

Volumes and Market Shares: Scorpio achieved its targets on market share and
achieved a volume of 12000 vehicles in the first 9 months of its launch.
Image: Scorpio advertising had a very high recall for the Mahindra brand (Exhibit 3) as
well as for the product (Exhibit 4). Apart from this, advertising actually positioned
Scorpio as a powerful vehicle with a sporty look, solidly built with good cargo capacity
amongst the premium car consumers and sports utility vehicle consumers.
Overall response to the Scorpio was stupendous. The product was well received
across the country and got rave reviews across media. More importantly the product
and the strategy delivered in terms of the various objectives set before launch. Footfalls
in the showrooms had been massive and demand had far exceeded supply of vehicles
with a waiting period of three months.

Impact on Mahindra Image:

The saliency of Mahindra increased considerably. Mahindra enjoyed stronger recall as
a manufacturer of personal vehicles and stronger customer perceptions on the
following attributes -
*Well-respected manufactrers
*Technologically advanced
*Suitable for city driving
*Great to drive
*Makes VFM vehicles
*Proud to own
*Makes good quality vehicles
34

Scorpio Brand Recall

In the SUV/MUV segment, Scorpio has the second-largest awareness and has
emerged as a strong brand in the C & sub-C car segment, however as compared to
Qualis, it needed higher recall. Scorpio advertising had been able to create a good
impression on appearance and styling of the vehicle.

Scorpio buyer profile

Scorpio managed to pull out customers from the C segment of vehicles. The product,
communication and the retail experience of the Scorpio passed the stringent test of
luxury car buyers and the buyer profile was exactly as per the target profile. The
strategy delivered with more and more small and midsize car buyers choosing the
Scorpio over the others.

Awards
The Scorpio was awarded various awards from various bodies
Mahindra achieved the objectives it set out to achieve. M&M has more than 39 per cent
of market share in hard tops, sold 11800 Scorpio in first nine months of operation and
due to this campaign, Mahindra image improved.

Scorpio Impact on M&M

Scorpio was launched on June 19, 2002. At that time Mahindra was losing market
share and the share prices were also at an all time low at around Rs. 100. The
Mahindra share of business was largely from the semi-urban and rural market of India
and the markets where Mahindra was strong were stagnating.
With the launch of Scorpio, things started looking up for Mahindra. There was an
improvement in the bottom line as well as the return to the shareholder. The revenue
for M&M Auto Sector increased from Rs. 1827 Cr. in F 02 to Rs. 2511 Cr. in F 03, a
growth of 37 per cent. The profits before Interest and Tax (PBIT) too zoomed up from
Rs. 102 Cr. in F 02 to Rs. 147 Cr. in F 03, an increase of 43 per cent. In F04 the
scenario has further improved. The half-yearly results show a growth of 54 per cent in
revenue and 218 per cent increase in PBIT. The share prices have outperformed the
Sensex and Share prices have zoomed from Rs. 100 to Rs. 400 by December ‘03.
As regards Mahindra image in the customers mind, the post launch study conducted
gave the following improvements (Brand track Study - Nov 2002 - IMRB):
*The Mahindra saliency scores improved by 27 points among MUV/ SUV owners and
by 29 points among all car-owners.
*The overall positive opinion about Mahindra also moved up by 18per cent among
MUV/ SUV owners and by 11per cent among all car owners.
*Mahindra Scorpio has fared excellently in overall opinion as against its key
competitors.

Future Directions - World class product goes global

Having done well in the domestic market, Mahindra and Mahindra is now moving
forward on its path to become a global niche player. i.e, it is stretching its activities in
foreign markets. The company is in the process of negotiating joint ventures in markets
like Spain, Italy, South Africa, Indonesia, Russia, Equador for marketing of Scorpio.
35

OBJECTIVES AND RESEARCH METHODOLOGY

OBJECTIVES OF THE STUDY
The research objective is a statement, which should be in precise terminology as
possible, of what information is needed. The research objective should be framed so
that obtaining the information will ensure that the research purpose is satisfied.
Research objective have three components.
Research question
The research question specifies the information the decision making needs. The
responsibility of the researcher is to make the researcher question as specific and
precise as possible. The researcher question asks what specific information is required
to achieve the research purpose, or answer the research problem. If the research
questions are answered by the research, then the information should aid the decision
maker.
Development of hypothesis
A hypothesis is a possible answer to a question. Development of hypotheses implies
generating basically alternative answers to research questions. The research
determines which of these alternative answers is correct. It is not always possible to
develop hypotheses, but efforts should be made.
Scope or boundaries of the research
Defining the scope of the research or the research boundaries ensures the desired
precision or accuracy of the result.
The researcher’s responsibility is to restate the initial variables associated with the
decision problem, that is convert the research problem, in the form of one or more key
question formats-
How
What
Where
When
Why
OBJECTIVES OF THE RESEARCH
The research objectives for the report undertaken can be defined as follows:

• To analyze varies factors which determine the consumer perception

• To study perception of consumers about the Mahindra Scorpio

• To judge the satisfaction level of car owners of Mahindra Scorpio.

• To know the customer perception about features, low maintenance cost and looks
Scorpio

• Finally recommend how we can improve the perception of people about Scorpio
36

SCOPE OF THE STUDY

It is aimed to study the car market and buying behavior of the customer. The project is
analyzed the demographic, psychographic and buying characteristics of the customers
in buying the car. It includes the detailed study of customers focusing on the various
parameters that lead to identifying and understanding the perception of the customer in
buying the car brands.

SIGNIFICANCE OF THE STUDY

A brand is a set of expectations and associations evoked from company or product. A
brand is how key constituents- customers, employees etc. experiences what you do.
Some brands are of such great importance to people, that we speak of them as a part
of one’s life and identity, being used to express one. Some would say that these brands
have their own personality, like: Mercedes, which can easily be associated with high
status and affluent owner. The brand perception, which can be defined as the set of
human characteristics associated with a given brand.
Because many people interact with brand as though they were other people, it is
important to understand what a brand perception consists of, and how its
characteristics can be used to affect the relationship between the brands and its users.
Knowing and understanding the brand perception gives a good insight into this
relationship, and into peoples’ attitudes towards the brand, and is also an important
guide to communicating the brand. Like apparel and lifestyles brands, a car is
extension of one’s perception. People buy cars which either matches their personalities
or those which provide them opportunities of being perceived as somebody they aspire
to be. This becomes significant as consumers move up the value chain from small
compact cars to midsize and upwards.
RESEARCH METHODOLOGY
A research process consists of stages or steps that guide the project from its
conception through the final analysis, recommendations and ultimate actions. The
research process provides a systematic, planned approach to the research project and
ensures that all aspects of the research project are consistent with each other.
Research studies evolve through a series of steps, each representing the answer to a
key question.
PRIMARY DATA
New data gathered to help solve the problem at hand. As compared to secondary data
which is previously gathered data. An example is information gathered by a
questionnaire. Qualitative or quantitative data that are newly collected in the course of
research, Consists of original information that comes from people and includes
information gathered from surveys, focus groups, independent observations and test
results. Data gathered by the researcher in the act of conducting research. This is
contrasted to secondary data which entails the use of data gathered by someone other
than the researcher information that is obtained directly from first-hand sources by
means of surveys, observation or experimentation.
Primary data is basically collected by getting questionnaire filled by the respondents.
SECONDARY DATA
Information that already exists somewhere, having been collected for another purpose.
Sources include census reports, trade publications, and subscription services. Data
that have already been collected and published for another research project (other than
37

the one at hand). There are two types of secondary data: internal and external
secondary data. Information compiled inside or outside the organization for some
purpose other than the current investigation. Data that have already been collected for
some purpose other than the current study. Researching information which has already
been published. Market information compiled for purposes other than the current
research effort; it can be internal data, such as existing sales-tracking information, or it
can be research conducted by someone else, such as a market research company or
the U.S. government. Published, already available data that comes from pre-existing
sets of information, like medical records, vital statistics, prior research studies and
archival data.

Resea

Figure-14
38

Chapter-
FINDINGS AND ANALYSIS

Q1. Why you bought your Scorpio car? Please rank from the highest order of
preference

40

35
39
30
Figure-15: Motives of buying a car
Interpretation: As per the analysis shows, increase in disposable income seems to be
the most important reason for buying a car. This trend is reflected in the growth of the
Per capita Disposable income and consequently the growth of the Indian automobile
industry especially in the B and C segment cars. Similarly, the growing family needs
25
like working partners, increasing family size, status, etc. add to the motives of buying a
car.

20

15

10
39

Q2. You decided to buy a Scorpio car because of (rate best 3 factors from 1 to 3 in
order of your preference)

Figure-16
Interpretation: Indian market is still the hard nut to crack for most of the automobile
manufacturers. Though the Indian car industry is among the fastest growing car
markets of the world still the Indian psyche is too complex for the manufacturers to
understand. The most important reason for buying a car when it comes to B and C
segment cars seems to be ‘value for money’. 32% of the respondents suggested that
affordable prices are the most important factor while purchasing a car. This is the
reason for sticking to a particular segment till the next substantial rise in the personal
disposable income. This reason is followed by ‘Value for money’ where the customers
look for the best product, best services and best repute all bundled in one with the best
deal they can strike. This explains the reason for the stagnant or sudden growth in sale
of B and C segment cars just before budget and near occasions like Diwali.
40

PRODUCT SATISFACTION LEVEL

Q3.Please rate your existing car in terms of understated Interior Design features on a
scale of 1 to 5 where 1 = Highly Dissatisfied, 2 = Dissatisfied, 3 = Neutral, 4 =
Satisfied, 5 = Highly Satisfied

Figure 1

Interiors for Segment B cars

100%
3 3 3 3 3 3 3

80% 1 1 1 1 3 1
4
satisfaction

4 4 4 4 Adjustable Front Seat Headrest

4 4
Level of

Music System
60% 4 Interior Colour
Dash Board
3 3 4 Leg Room
3 4 Seat Design
3 3
40%
4 4 3
3 4 4 4
20%

3 4 4 3 4 4 4
0%
Maruti Maruti Maruti Indica Aveo Santro Getz
Estilo Wagon Swift V2 Cars
R

Figure-17
Interpretation: Interiors play a very important role in deciding the sale of a car.
Moreover, comfortable and exotic the interiors are more are the chances of its being
popular among the customers. For this reason manufacturers spend billions of dollars
every year on R&D to continuously improve the interiors of their cars. Seats, leg room,
dash board, armrests etc are few of the options which count for the interiors. As the
analysis show Getz scores substantially high w.r.t. its counterparts on the account of
music system installed. Similarly, Indica V2 races far ahead as far as leg room is
concerned. However, M&M Pessenger Car fares badly on this front. Overall, almost all
cars get a mixed response in this segment as far as the interiors are concerned.
41

Customer S

100%
3 3 3
Satisfaction level ( in %age)

80% 3 3 3

Figure-18
4
Interpretation: As one can see most of the respondents are quite happy with the
4 4
60%
interiors of their respective cars. However, one striking point observed here are that
almost every car fares neutral on the adjustable front seat headset. These cars have
more leg room, come with attached music systems (Verna fares the best among all
cars on this front) combined with luxury features like TV screens, armrests at the back
seat etc. Talking about Mahindra and Mahindra’s Xylo it has a perfect blend of interior,it
seems that it has taken it from ‘D’ segment cars.A lavish interiors are always a akin for
good selling. 3 4 4
40%

4 4 4
20%

4 4 4

0%
no

go
m
42

Q4. Please rate your existing car in terms of understated Safety features on a scale of
1 to 5

Customer S

100%
Customer Satisfaction Level ( %age)

90% 3
4 5
80%

Figure-19 70%
Interpretation: It can be noted Passenger Cars Getz ,Swift and Indica V2 fight neck to
3
neck on almost every front, with Indica marginally better in features like crossbars
under the dashboard and Anti Brake systems. Most of the cars in this segment fare
60% 4
relatively similar and very close to each other on most of the fronts.
4

50%

3
40%
3 4
30%
1
1
20% 1

10% 3 3 3
43

Customer S

100%

90% 3 3 4

80%
Customer satisfaction level

Figure-20
70% 3 3
Interpretation: As one can see most of the respondents are quite happy with the 3
safety parameters of their respective cars. However, one striking point observed here
are that almost every car fares neutral on the safety parameters.

60%

50% 4
4 4

40%

30% 1 1 3

20%

4 4
10% 4
44

Q5. Please rate your existing car in terms of following parameters

Customer Sa

100%
Customer Satisfaction Level ( %age)

90% 3 3
3

80%

Figure-21 70%
3
Interpretation: The customer choice of the car highly depends upon the performance 4
and maintenance costs of the car. This is the3 reason why this class of parameter was
60%
chosen for this study. And the results show that Hyundai Passenger Car’s could give
hints as how to increase pickups, stability at high speeds and optimum fuel efficiency.
M&M Passenger Car can fare out as the best car in its segment as most fuel efficient
car of all. Similarly, M&M Passenger Car fares the best on the terms like mileage but it
lags behind with few. So 50%this segment shows a mixed bag of response for the Fuel
efficiency and mileage parameter. Indica V2 performs consistently on all the
parameters and Getz fares really well on pick up whereas it fares badly on fuel
consumption. Considered this condition for Getz it should be seen 4 as a red signal for
the manufacturers so that Getz does not end up being like Fiat’s Palio famous as a car
for ‘drinking petrol. 40%
3
4
30%

20%
4
3
10% 3

0%
45

Customer Satisf

100%

90%
Customer Satisfaction Level ( in %age

4 4 5
80%

Fig-22
70%
Interpretation: Segment C cars are known as hybrid car segment between the B
segments fuel efficiency with the luxury of the D class. Checking the same it seems
that most of the cars in this segment are placed much closed to each other with very
60%
little difference here and there. Most of the cars are fuel efficient with respect to their
3
weights and pick ups. Indigo fares as the best car in terms of fuel efficiency. Baleno
4 4
terms)

fares a little bit behind than its counterparts as far as the stability at high speeds and
mileage is concerned.

50%

40%
3 3
3
30%

20%

3 4
10% 3
46

6) What should be the top speed of your family car?

Figure-23

Interpretation: It suggests that the car having maximum speed more than 150kmph is
no problem as it is only plus as one could easily increase its speed when ever it is
required. Customers want their cars to be fully equipped with high speed systems.It
also signals toward the thrill part as by adding more thrill gears into their cars they can
really move ahead.
47

7) What is your preference when it comes to considering the availability of the parts
and accessories of your car?
Parts and accessories available all over the country
Parts and accessories available only in big cities
Unique parts and accessories should be available on demand otherwise parts should
be available all over the country
If any other
Parts and
90.00% accessories
available all over
80.00%
the country:11.42%
70.00% Parts and
60.00% accessories
available only is big
50.00% cities:2.85%
40.00% Unique parts should
be available on
30.00% demand:85.71%
20.00%
If any other:None
10.00%
0.00%

Figure-24
Interpretation: Parts and accessories should be available all over the country in this
case the indigenous Mahindra and Mahindra automobile is far ahead of other
counterparts as it is evident that its showrooms and work shops are at all places
inIndia. As the respondents showed by their responses that the unique parts should be
made available on demand but the daily chores of the parts should be available every
where.It can further move ahead by opening more dealerships and showroom so that
all the parts could be made available easily throughout India.

Satisfaction level of customers with dealers of various car manufacturers on various

parameters
Q1. Please rate your Dealer on the understated parameters on the scale of 1 to 5
where, 1 = Highly Satisfied, 2 = Satisfied, 3 = Neutral, 4 = Dissatisfied, 5 = Highly
Dissatisfied
Distance ( Proximity)
Advertisements (Promotions)
Technical Facilities
Cost of Service
Availability of Spares
48

Information Provided
Service Time
Charges
Staff
Car Handling ( Delivery & service)
Assured Customer Transactions
Ambience of Service Center
Finance ( Credit) Schemes
Dealers are the middle men between a car manufacturer and its customers. Dealer
thus becomes the most important link in joining the company to its customers as he is
the person who will sell the product, will deliver it and will keep on providing the after
sales services to the customers as and when required. So, it becomes necessary
automatically to study dealer as a part of customers’ satisfaction journey with the
product called car!
Why M&M Passenger Car fares so well ahead of its competitors till date and its the
largest car company in India with the largest market share in A and B segment is
because during the protected regime it build a dealers network so strong that its yet
very difficult for most of the competitors to set up a network as large as M&M
Passenger Car. So wherever you go its not difficult to find a M&M Passenger Car
service station and a M&M Passenger Car dealer. This is how M&M Passenger Car
has maintained relationships with its customers and has been able to convert most of
them into a repeat customer. So, dealer network is something of such importance that
while studying the customer’s satisfaction profile its almost impossible to ignore it.

Custom er Sa

100%
evel ( in %age terms)

90% 2
4 4 4 4
80%
1
70%
3 2
2 4
60%
3
50%
3 4
49

Figure-2
Interpretation: While buying a car, dealers ‘choice play a very important role in
deciding the company and model’s choice. So dealers act as influencers on the
complete buying behavior of the prospective customers. Among all the listed factors
M&M Passenger Car fares the best among all its counter parts in terms of dealer
density which is quite obvious. Also, the cost of service provided by M&M Passenger
Car dealers is the lowest followed by Tata Motors. Similarly, for B and C segment cars
M&M Passenger Car emerges out as the clear winner among the four car companies
studied all thanks to the vast, extensive and well managed dealer system.

Q2.How do you rate the brand image of your car?

1 = Very Low and 5 = Very High
Customer Perception ( Avg)

Brand Image
6

3 Series1
5
2 4 4 4
3 3 3
1

0
crv Maruti Maruti safari Tata Scorpio sumo
Wagon R Swift grand
Car Brands
Figure-26
Interpretation: As per the analysis, Hyundai Passenger Car is the car whose brand
image is most preferred in the market. This is because of the reason, that it’s from the
house of Hyundai a South Korean company known for its overall image. On the
contrary Passenger Car Estilo and Aveo share the same platform on the brand image.
This can be attributed to the fact that both these cars are relatively new on the block
and market takes time to imbibe and give the brand an image. This is established by
the fact that TataIndica Car and Swift are exactly the same as far as the image is
concerned.
50

Custo

5
Customer Perception ( Avg)

Figure-27
Interpretation: As the analysis reveals GM’s Optra fares as the Best Car as far as
4
customers’ perception is concerned about the brand image of the car in the C segment.
This is because of the fact that GM itself commands an amazing brand image among
its customers. Accent and Verna both Hyundai cars share the same position.

2 4 4
3
1
51

Q3.Will you recommend your car to your

friends?

Cus

80
73
70

60
Figure-28

Interpretation: It seems logical that satisfied customers will someday become loyal
customers, in other words there is a positive correlation between customer satisfaction
scores and customer buying behavior. If a customer rates the car very high in satisfying
50
his or her needs, the car manufacturer should expect more referrals and this is
reflected in the analysis that 73% customers say that they will refer their car to their
Frequency

friends even if they move to other segment or other brand.

40

30

20

10
52

Q4.Will you buy your new car in the

40

35

30
Figure-29
Interpretation: The analysis shows that most people when moving to upper segment
25
will prefer a different manufacturer. And the next striking finding is that the customers
will prefer both same and different manufacturers in the B segment cars and there is
not much difference in the C segment also. This behavior is complex to understand as
Values

this are the customers who have given whopping response for recommending their car
to their friends. It’s the reason why brand perception is so difficult to understand.
20 6

15 7

10
17

5 11

0
53

DEMOGRAPHICS
agegroup
<21
21-35
36-55
>55

17
20

21

41

Figure-30
I surveyed around 50 people who belonged to various age groups. The survey of
4 age groups was done. The four age groups were:
Less than 21 years
21 -35 years
36-54 years
More than 55 years
54

MONTHLY FAMILY INCOME

monthly family
income
<50,000-33%
50,001-1,00,000-28%
1,00,001-2,00,000-19%
>2,00,001-19%

19

33

19

28

Figure-31
I surveyed around 50 people who belonged to various monthly family income
groups. The survey of 4 income groups was done. The four income groups were:
Less than 50000
50000 - 1,00,000
1,00,001 – 2,00,000
More than 2,00,001
Interpretation: Above graphs exhibits the income bracket of the sample size, as
evident the majority of the sample is in the income bracket of < 50,000 a month income.
Though none of the bracket is highly skewed, this enables the study to be wide and not
dependent on a set income class, which was a fortunately desirable result of simple
random sampling.
55

CROSS TABULATION
Motive to buy the car*segment car B and C

Bar Chart

20 segment Car B
Tata grand
Wagon R
Swift
15 Santro
Safari
Indica V2
Aveo
10 Esteem
Count Baleno
scorpio
Verna
5 Indigo Marine
Indigo
Optra
0
Affordable prices
Technical value
Superiority over moneyAfter sales service
forSafety
competition
Comfortmanufacturer's image

respondant's objective buying a car brand

Figure-32
Interpretation: According to the result, I found that choice of car depends upon these
following factors: the choice of car is not driven only by intensive factors such as brand
perception but is hugely influenced by extensive factors such as price, services, and
models available, financing options etc. also the choice of the car is largely influenced
by the manufacture image. This is why Getz emerges out as a winner in the B segment
for this criteria as they provided value for money. As Getz is from the house of Hyundai
known for its technology and great design is far better perceived as a preferred car
than other cars. But a word of caution here, this perception may or may not result in a
converted sale. If Mahindra and Mahindra starts providing the value for money as Getz
is doing. Which means provide something extra which could bring delight on
customer’s face for an example: Lavish interiors and excellent fuel efficiency; then
certainly Mahindra and Mahindra can surge-up its sales by leaps and
bounds.Recommend the car to your friend*ranking of Brand and company .
56

Bar Chart

respondants' ranking of
40
brand and company
image
Very Low
Low
Neutral
30
High
Very High

20
C
n
u
o
t

10

0
yes no
Would you recommend your car to your friends

Figure-33
Interpretation: The graph shows that people who rank their car high or very high on
the brand image are the people who recommend their car to their friend. This is
something the car companies should look for as these people may not be the brand
loyal but are definitely the people who help a company to reinforce the brand image
propagated by the company. Ranking of Brand and Image*Segment B and C car
57

Q- Customer opinions toward space availability in Mahindra Scorpio.

Factor No. of Respondent
More Satisfied 11
Satisfied 21
Neither Satisfied & Dissatisfied 7
Dissatisfied 1

Figure-34

Interpretation:
The sample drawn on the probability basis shows that out of 100% of respondents 52%
of the respondents approached were satisfied with the space availability of the Scorpio.
27% were more satisfied, 18% of neither satisfied and dissatisfied and 3% are
dissatisfied with the space availability of the Scorpio.
Observation:
As 70% of the respondents are happy with the space availability of the Mahindra
Scorpio vehicle, it can be conducted that the company has undertaken proper R&D in
this aspect. The 30% of the respondents who have answered negatively may be
comparing with the vehicle in the same category launched very recently.
58

RECOMMENDATIONS
According to the research and analysis done in this thesis brand personality alone is
not enough in many cases. Such as take case of Tata’s Grande it has the brand
personality made for the semi affluent group or say it was launched as segment C car,
but it could not live upto the expectation as people were asking for more that were
:better fuel efficiency, affordable price and looks to die for. people who rank their car
high or very high on the brand image are the people who recommend their car to their
friend. This is something the car companies should look for as these people may not be
the brand loyal but are definitely the people who help a company to reinforce the brand
image propagated by the company. For an example :Zen was a segment –B car of the
Maruti udyog Ltd company and it was a hit car and why because the customer liked its
fuel efficiency qualities, its looks, affordability, and say it was complete value to the
money. Definately people helped the company to reinforce the brand image by
recommending it to others which they had aimed at its inception. As per the analysis
,its evident that customer satisfaction means retention of customers, and hence
customers bring word of mouth into play. Supposedly according to analysis the best
way to achieve optimum sales when your satisfied customers bring word of mouth into
play. Customers satisfaction is taken as an asset by many customer centric
corporations. Product satisfaction, After sales services satisfaction and relationships
satisfaction are the three core elements which customers are looking for. Those who
implied these elements, their cars are selling like hotcakes. According to the analysis
done, choice of car depends upon the factors such as brand perception but is hugely
influenced by extensive factors such as price, service, and models available, financing
options, its resale value, sturdiness and looks, etc. Also the choice of the car is largely
influenced by the manufacturer’s image. Increase of sales could also be achieved by
showing technology advances. Car manufacturing companies research and
development department should also look at the disposable income of the citizens as
analysis showing that most of them belonged to income group that is below Rs.50000
per month and hence they want to buy a car, which can suit their pockets. In this case
‘Xylo’ is the perfect example, the indigenous company of Mahindra and Mahindra has
shown greater research acumen. As we all know that its (xylo) basic variant starts at
Rs.6,75000 well within the reaches of the income groups. Such types of research
acumen will definitely see increase in selling. The analysis also shows that most people
when moving to upper segment of the car will prefer a different manufacturer.As for an
example: Mahindra and Mahindra don’t have upper segment car for affluent groups. In
competition with its foreign counterparts such as Toyota, GM, etc. It should also look to
launch a upper segment car such as land cruiser of Toyota company. So that the
customer will remain loyal to the company and increase in sales in its upper segment
cars will also be seen. On the other hand when talking about B or C segments cars
customers, they recommended for it and remained loyal, this also showed that how
complex is it to understand brand perception of the customers. Here one thing is for
sure that those who recommend their cars are satisfied customers. As per survey
another very important thing has come to the fore, and that is the availability of the
parts and accessories of the car. For an example :In India all the regions are not well
developed so many car manufacturing companies could not able to open their
showrooms and dealerships at remotest of the places. On this front company like
59

Mahindra and Mahindra can keep its nose ahead by opening its dealership in remotest
of areas and this will surge up the selling.
Safety gears, Interior design, over all looks, Fuel efficiency, and Maintenance cost
incurred, etc. All these factors are very important factors with Segment-B and C as
such type of cars usually in the Indian car market are bought by income groups whose
newly increased disposable salary can afford but they put every step with great caution
while buying the car. In this case a car which has a perfect blend of all the above
mentioned factors, could easily surge-up the pace of the sales of the cars.
A very important role is played by dealers, which can always prove to be the main
reason behind selling or none selling. It is evident by the analysis that many important
cases are being handled by the dealers and hence lead to the customers satisfaction
and retention. Such as advertisements (promotions), providing technical facilities, cost
of service, availability of spares, information providing, services time, finance credit
schemes, car handling during servicing, etc .Customers are very clever they look for
the distance proximity of the dealership from their residing places as well. This thing
also lead to increase in sales or decrease in sales. So the dealership should be made
available if a company wants to increase its sales.
Mahindra and Mahindra is the leader in light commercial vehicles, including three-
wheelers. It is the market leader in utility vehicles in India since inception, and currently
accounts for about half of India’s market for utility vehicles. The further more market
share could be captured, if it starts following aforementioned recommendations.
60

CONCLUSION
To conclude, the results show that the companies are playing on the peripheral cues to
maintain their Total Relationship Management and connect to the customers both
present and potential. The companies are operating in a highly aggressive and
competitive global market place and this climate has led to the emphasis on quality in
all aspects. TQM focuses on integration and coordination as well as the continuous
improvement of all activities and processes. Total Relationship Management (TRM) is a
very recent marketing strategy and philosophy. It focuses on and is concerned with all
integrated internal and external activities within and between the organizations. These
two terms are integrated by the manufacturers by building good quality products and
building good relationship with dealers and enhancing service levels.
However, when studied from the point of view of a customer there seems to be no
major difference among the car brands in a segment as far as performance is
concerned. The brand perception is dependant mostly on the peripheral cues
depending upon the nature and quality of the service provided along with the pricing,
maintenance, availability of spare parts and related issues. So, a question arises here
that is this the end of road for the branding of cars? Has the commoditization of cars
has started and its time that manufacturers must read the writing on the wall? It seems
so! It seems as an undercurrent sentiment is flowing and the perception of the
customers is changing according to it. So this might be the reason that despite Verna
faring so high on the performance parameters still lags on the account of converted
sales. The study shows that brand perception is something which starts building up
before a car is purchased and goes on with its use and is reflected in the
recommendations the customer makes to his acquaintances for the same car. Also, its
seen that the customer might not be using the car still he holds the perceptions about it.
Brand personality of a car is enforced by the sellers in the mindsets of the customers
and the customers react to it by forming their perceptions about the car and this reflects
in the overall brand image of the car. So brand image and brand personality
complement each other and the brand perception aids the building of brand image.
Dealers, as per the study findings, play a very important role in building up the brand
perception of the cars. Since dealers are the connecting link between the customers
and the manufacturers thus becoming the most important link in joining the company to
its customers as he is the person who will sell the product, will deliver it and will keep
on providing the after sales services to the customers as and when required. So, it
becomes necessary automatically to study dealer as a part of customers’ satisfaction
journey with the product called car! Their proximity to the customers, the service
provided by them and the relationship maintained by them with the customers helps the
car companies to establish and reinstate the brand personality communicated by them
to the customers.
Finally the major point that emerges out of this detailed study is a caution for the car
companies ,what are the do’s and what are the don’ts ?ultimately, “ how to increase
passenger car sales?”, the answer lies within this result of this research. It says that
there is no doubt that Indian car market may be growing with a double digit figure still
the car companies have a long way to travel to convince their customers about the
brand personality of their cars and how it suits the prospective buyers. Simply because
it simply is not a guarantee that how so ever good the customer might be holding the
brand perception and how so ever good the brand image may be it is not a guarantee
that it will convert into sale. Cars just like clothes and accessories suit the style and
61

persona of a person and since all cars will become commodity someday the key to sell
and excel in the market will lie with a person who knows how to use the perceptions of
the customers to its use and sell the cars ‘coz ultimately only that car survives which
sell.
62

BIBLIOGRAPHY
Sites Visited -
www.siamindia.com
www.autocarindia.com
www.overdrive.com
www.mahindraandmahindra.com
www.ibef.org
a. Book referred to
Philip & Kotler: Marketing management
b. Journals
HBS (Harvard business review)
c. Magazines
Companies research paper
Business Today
d. Internet
i. Sites
(1) www.marketingtimes.com
(2) www.maruti.com
(3) www. Hyundai.com
ii. Search Engines
www.google.co.in
63

APPENDICES

QUESTIONNAIRE
For Customers:
Q1. Why you bought your present car (SCORPIO)? Please rank from the highest order
of preference
Increase in disposable income
Better safety at roads
Family needs
Increase in family size
Suits your lifestyle and personality
Q2. You decided to buy a car brand (SCORPIO) because of (rate best 3 factors from 1
to 3 in order of your preference)
Affordable price
Technical superiority over competition
Comfort
Manufacturer’s image
Value for money
Safety
After sale services
Product Satisfaction Level
Q3.Please rate your existing car in terms of understated Interior Design features on a
scale of 1 to 5 where
1. Highly Dissatisfied
2. Dissatisfied
3. Neutral
4. Satisfied
5. Highly Satisfied
Interior Type 1 2 3 4 5
Seats design
Leg Room
Dash Board
Interior Colour
Music System
SAdjustable Front seat Headrest

Q4. Please rate your existing car in terms of understated Safety features on a scale of
1 to 5
Safety Parameters 1 2 3 4 5
Crossbar under Dashboard
Air Bags
Anti Lock Breaking System
Aerodynamic Shape
Intensity of front lights
Q5.Please rate your existing car in terms of following parameters
Parameter 1 2 3 4 5
64

Fuel Consumption
Mileage ( Km/ltr)
Pick Up
Stability at higher speed
Top speed
6)What should be the top speed of your family car?
160kmph
150kmph
140 kmph
130 kmph
between 110 to 125kmph

7) What is your preference when it comes to considering the availability of the parts
and accessories of your family car?
Parts and accessories available all over the country
Parts and accessories available only in big cities
Unique parts and accessories should be available on demand otherwise parts shouldbe
available all over the country
If any other
65

Customers satisfaction levels with dealers of car manufacturers on various parameters

Q8. Please rate your Dealer on the understated parameters on the scale of 1 to 5
where
1. Highly Satisfied
2. Satisfied
3. Neutral
4. Dissatisfied
5. Highly Dissatisfied
1 2 3 4 5
Distance ( Proximity)
Advertisements (Promotions)
Technical Facilities
Cost of Service
Availability of Spares
Information Provided
Service Time
Charges
Staff
Car Handling ( Delivery & service)
Assured Customer Transactions
Ambience of Service Center
Finance ( Credit) Schemes

Q9.How do you rate the brand image of your car?

1 2 3 4 5
Very Low Very High

Q10.Will you recommend your car to your friends?

Yes
No

Q11.If yes, will you buy your new car in the

Same segment , same manufacturer
Same segment, different manufacturer
Upper segment, same manufacturer
Upper segment, different manufacturer
Age group:
<21 21-35
36-55 >55
Q12- Customer opinions toward space availability in Mahindra Scorpio.
Factor No. of Respondent
More Satisfied 11
Satisfied 21
Neither Satisfied & Dissatisfied 7
Dissatisfied 1
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Q13What is your monthly Family income?

Less than 50000
Rs 50,000 –Rs 1, 00,000
Rs 1, 00,001– Rs 2, 00,000
More than Rs 2, 00,001
Number of car’s owned:
Present Car (s) owned:
NAME: GENDER:
Phone No: