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CORPORATE INTRODUCTION

Honda Motor Co., Ltd. operates under the basic principles of "Respect for the Individual" and

"The Three Joys" — commonly expressed as The Joy of Buying, The Joy of Selling and The Joy

of Creating. "Respect for the Individual" reflects company’s desire to respect the unique

character and ability of each individual person, trusting each other as equal partners in order to

do their best in every situation. Based on this, "The Three Joys" expresses their belief and desire

that each person working in, or coming into contact with company, directly or through or

products, should share a sense of joy through that experience.

In line with these basic principles, since its establishment in 1948, Honda has remained on the

leading edge by creating new value and providing products of the highest quality at a reasonable

price, for worldwide customer satisfaction. In addition, the Company has conducted its activities

with a commitment to protecting the environment and enhancing safety in a mobile society. The

Company has grown to become the world's largest motorcycle manufacturer and one of the

leading automakers. With a global network of about 507 subsidiaries and affiliates accounted for

under the equity method, Honda develops, manufactures and markets a wide variety of products,

ranging from small general-purpose engines and scooters to specialty sports cars, to earn the

Company an outstanding reputation from customers worldwide.

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HONDA IN PAKISTAN

ATLAS GROUP AND ATLAS HONDA LIMITED

Atlas Honda Limited (AHL) is a joint venture between the Atlas Group, Pakistan and Honda
Motor Co. Ltd., Japan.

The Atlas Group comprises of 7 public and 4 private limited companies, with over 5,000 staff
members. The foundation of the Atlas Group was laid by Mr. Yusuf H. Shirazi, in 1962 with
the establishment of Shirazi Investments (Pvt) Limited.

Atlas group operates in three sectors:

1-Engineering Sector

2-Trading Sector

3-Financial Sector

1- Engineering Sector

The Engineering Sector includes the following listed companies.

1- Atlas Honda Limited

2- Honda Atlas Cars (Pakistan) Limited

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3- Allwin Engineering Atlas Engineering

4- Atlas Battery Limited

5- Atlas Power

2- Trading Sector

The Trading Sector includes the following listed companies.

1- Shirazi Trading Co. (Pvt.) Limited

2- Honda Atlas Power Product (Pvt.) Limited

3- Total Atlas Lubricant Pakistan (Pvt.) Limited

3-Financial Sector

Atlas Group has following three financial companies.

1- Muslim Insurance Company Ltd. Shirazi Capital

2- Atlas Investment Bank Ltd.

3-Atlas Asset Management Co. Ltd.

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ATLAS HONDA LIMITED (AHL)

Atlas Honda Limited was created by the merger of Panjdarya Limited and Atlas Autos Ltd. in

1988. Both these motorcycle manufacturing concerns were established by the Atlas Group. In

addition, a third concern, Atlas Epak Ltd. was taken over by the Government of Bangladesh in

1971 after the fall of Dhaka. AHL manufactures and markets Honda motorcycles in collaboration

with Honda Motor Company. Honda motorcycles are by far the largest selling motorcycles in the

country with an unmatched reputation for high quality, reliability and after-sales-service.

Atlas has undertaken to develop local manufacturing capabilities to the highest, economically

feasible level. While a major role in localization has been assigned to vendor industries, Atlas

has the country's largest in-house manufacturing capability in the country at its Karachi and

Sheikhupura plants. To support the production facilities, the company has established an R&D

wing and tool making facilities which are growing rapidly in size and function as the company

expands.

Atlas has managed to execute 12 Joint Ventures and Technical Assistance Agreements between

local vendors and foreign manufacturers for transfer of technology besides Atlas has directly

executed 9 Joint Ventures-and (TAA) Technical-Assistance-Agreements-other-than-with-Atlas

Honda Ltd management is striving to modernize company operations by adapting applicable

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aspects of research and theory and more specially, Honda's unique philosophy of hard and soft

technologies to the realities of Pakistani conditions. Company management structure, systems

and processes are reviewed periodically according to the demands of the-customer. -

Decision making in the Company in participation of all levels of personnel besides substantial

and effective delegation has been established at levels where applicable. Various participation

programs such as 'Ala Mayar' Quality Circles movement, launched in 1985, are encouraged to

Allow constructive self-expression and teamwork. The Company training and development

programs encourage members to develop themselves and-contribute-to-their-full-potential.

Atlas Honda is playing a pioneering role in creating conditions for easy and confident use of

motorcycles all over the country. A vast and growing network of over 1600 motorcycles sales

service and spare parts dealers has been established.

In order to back up this system, Atlas has set up Technical Training Centers in Karachi and

Lahore which provide several courses of varying duration and complexity for motorcycle

mechanics and users each year. Mobile training facilities take the latest know-how, technology

and maintenance of motorcycles to major rural and urban centers around the country.
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VISION AND MISSION STATEMENTS OF AHL

VISION

Market leader in the motorcycle industry, emerging as a globally competitive centre of

production and exports.

MISSION

A dynamic growth oriented company through market leadership, excellence in quality and

service and maximizing export, ensuring attractive returns to equity holders, rewarding

associates according to their ability and performance, fostering a network of engineers and

researchers ensuing unique contribution to the development of the industry, customer satisfaction

and protection of the environment by producing emission friendly green products as a good

corporate citizen fulfilling its social responsibilities in all respects

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ORGANIZATIONAL STRUCTURE

Chairman

CEO

Finance Marketing Supply chain HRM Quality R&D

Procurement Warehouse Production Control

Imports
RM SAP
Local
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GOALS AND OBJECTIVES OF AHL

• Customers

Customers of AHL are the reason and the source of their business. It is their joint aim with
their dealers to ensure that their customers enjoy the highest level of satisfaction from use of
Honda Motorcycles.

• Quality

To ensure that their products and services meet the set standards of excellence.

• Local Manufacturing

To be the industry leader in indigenization of motorcycles parts.

• Technology

To develop and maintain distinct business advantages through continuous induction of

improved hard and soft technologies.

• Shareholders

To ensure health and viability of business and thus safeguarding shareholders interest by
maximizing profit. Payments of regular satisfactory dividends and adding value to the shares.

• Employees

To enhance and continuously up-date each member's capabilities and education and to
provide an environment which encourages practical expression of the individuals potential in
goal directed team efforts and compensate them attractively according to their abilities and
performance.
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PRIMARY FUNCTIONS OF THE COMPANY

Four primary functions of the company are:

• Planning
• Controlling
• Leading
• Organizing

1) PLANNING:
Planning is concerned with the future impact of today's decisions. At AHL planning is done to
ensure the budgeted production targets of the company. On the forecasting done by marketing,
the company sets its production targets. On the basis of these targets following type of planning
is done.
• Aggregate planning
• Master production schedule

Aggregate planning:
On the basis of forecasting, a schedule from SAP, according to the production capacities and
company’s strategies, is generated which includes the planning of whole year.
It includes the production breakup of motorcycles for whole year into model wise, plant wise and
month wise breakups.
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Master production schedule:

On the basis of aggregate planning, such a monthly schedule is made which includes day wise
(2-shift wise), model and color wise breakups.
Planning also include vision, mission goals and objectives of the company (all these things of
AHL are explained above).

2) CONTROLLING:

Controlling is a process of establishing performance standards based on the firm's objectives,

measuring and reporting actual performance, comparing the two, and taking corrective or
preventive action as necessary. As AHL is very keen to achieve their goals so they have
established a good controlling system of their company. Managers of AHL identify problems in
the company so that they can take corrective actions to solve the problems. Production control of
AHL is concerned with determining the necessary resources to implement the production plan
have been provided, and if not, it attempts to take corrective actions to address the
deficiencies.AHL has a full control over their inventory, production, daily activities, employees
and sales etc. which allows them to give good performance in the market.

3) LEADING:

Good leaders are the key to large-scale community organizing. Leader of AHL (chief executive
officer) is Saquib H. Shirazi. Managers of AHL strive to become an inspiration to the
employees. Managers of AHL try to create a climate that encourages new ideas and employee
input. They share information and lets employees know the latest news in the company. They
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allow employees to feel like they are making a meaningful contribution to the company. They
divide work among employees by making sure that every one has the ability to carry out their
task and then let them carry it out in their own way, so that the employees can remain confident
and satisfied with the company. They also reward employees with monetary or benefit incentives
if they can increase output of a product. Managers of AHL recognize efforts of their employees
in meetings and conversations etc. They also try to build confidence in their employees, so that
employees can work more effectively.

4). ORGANIZING:

Organizing is an important part and function of management which follows planning. Organizing
is establishing the internal organizational structure of the business. The focus is on division,
coordination, and control of tasks and the flow of information within the organization. Managers
of AHL divide people in different departments according to their expertise, so that employees
can perform their tasks more effectively.
AHL always try to well organize their all departments like in human resource department they
know how many employees should be hired and what should be the selection and recruitment
plans. In finance department managers of AHL try to organize in such a way as to maximize
their profits and control costs and in marketing department their focus is to organize sales,
promotions and advertisements in an efficient manner so they can increase their sales. This
shows that organizing is one of the aspects of their success.
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COMPETITIVE ADVANTAGE OF AHL

The Company’s real competitive advantage comes from its associates who are technically skilled
and professionally committed. They are the real strength of AHL’s manufacturing and marketing
powers. The Atlas Honda culture is what one is most proud of. The business and work ethics that
the Company cherishes has its roots in more than 47 years of practice of responsibility and
dedication. High ideals have been pursued by the company at good times as well as through
tough times. It is this consistency that has made Atlas Honda a unique Company.

TOOLS OF COMMUNICATION

Atlas Honda Limited uses some tools of communication which are:

 Internet
• E-mails
• Weblog
 Letters
 Telephones and mobiles
 Conduct meetings
• Upward communication
• Downward communication

INTERNET:
Atlas Honda uses internet for communication purpose. By using internet they can communicate
through:
• E-mails
• Weblog
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Atlas Honda uses e-mails for both internal and external communication. They can send or
receive e-mails from their employees, customers and even other companies.
Atlas Honda uses weblog usually for external communication. They use weblog for
advertisements or announcements. Customers can even give suggestions or comments on
company’s web pages.

LETTERS:
Letters are used for both internal and external communication. Within the organization they use
letters for announcements etc. They can also send or receive some confidential letters from
different people or companies.

TELEPHONES AND MOBILES:

Telephones and mobiles are also used for communication. For ordinary issues they usually
contact their managers and employees through telephones and mobiles.

CONDUCT MEETINGS:
Atlas Honda conducts routine meetings which is also a source of their communication.
The company uses both upward communication and downward communication.
In upward communication information flows from the lower levels (first line managers) of a
hierarchy to the upper levels (top managers).
In downward communication, information flows from the superior to subordinates of the
company. Here top managers can call subordinates for a meeting to tell what important (mission)
is and what is valued (policies). Downward communication can be through face to face as well
as through written memorandum, orders, hob description etc.
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FUNCTIONS OF HUMAN RESOURCE DEPARTMENT

Functions of human resource department at AHL are:

1. Recruiting & Selection:

“Merit, Equality and Diversity”

This includes activities like giving ads on appropriate media so that potential candidates are
attracted and after acquiring a pool deserving merit basis.

2. Training & Development:

Selecting a good employee is not enough till he is trained to give his best for the organization. To
make him more useful for the organization an induction process is done at AHL.

3. Performance Appraisal:

Now when an employee is trained and he has performed his job for a certain period then
company has to identify if that person is doing his work according to job description so they
conduct performance appraisal.

4. Compensation:

On the basis of performance appraisal employees are compensated according to their

performance. High performing employees get encouragement certificates and cash rewards.
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TRAINING & DEVELOPMENT:

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BRANDING

Honda is an entity that realizes the dreams of individuals and spreads joy to people. Honda's
philosophy, unique corporate culture, pursuit of challenges that fulfill individuals' dreams and
variety of products and activities born of challenges will remain the foundation of the Honda
brand. We will continue building on our history of realizing people's dreams.

Honda's Goal in Branding

To create a brand that is supported by people’s expectations and appreciation.

Global Brand Slogan

Everyone has a dream, some goal or activity that gives their life a deeper meaning and sparks
passion. When we pursue a dream, we feel empowered. This power, in turn, connects us to
others who share the same dream. It gives us the strength to overcome great challenges and
inspires us to spread the joy of our dreams to others. Ultimately, the power born of a dream is a
creative force, capable of producing revolutionary ideas. Honda encourages all is associates to
pursue their dreams. That is why we say we are a company built on dreams. In the new century,
the power of Honda's dreams will continue to lead new insights and technologies in automobiles,
motorcycles, power products, parts and other fields of mobility that are just beginning to be
imagined. Dreams are the very essence of Honda. The dreams of our associates, customers, and
supporters make Honda what it is today. Our highly original ideas and free thinking have
surprised the world on many occasions. Honda will continue to be Honda in the 21st century as
long as we have our dreams and original thinking. We will keep on dreaming and challenging
ourselves to realize our dreams.” What will we come up with next?” We will continue creating
exciting products and realizing people’s dreams and expectations. Our slogan For Honda to
remain Honda, and for everyone to realize their aspirations, we must believe in "The Power of
Dreams".
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Export

It exports its products to following countries:

• Bangladesh
• Afghanistan
• Nepal
• Srilanka

MARKETING MIX

There are four elements of marketing mix.

• Product
• Price
• Place
• Promotion

1. PRODUCT:

Atlas Honda has four products (brands)

• HONDA CD 70
• HONDA CD 100
• HONDA CG 125
• HONDA CG 125 DELUXE

HONDA CD 70

Honda CD 70 is the No. 1 choice in motorcycles. In addition to its

established superiority in terms of great speed and fuel economy, the Honda
CD 70 is presented with special features and its design
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HONDA CD 100

Quality, Performance, Speed, Economy Petrol and Re-sale Value define Honda

Motorcycles It is a stunning result of advanced Japanese technology and right up

they’re as an outstanding performer representing all the qualities that make Honda motorcycles
so special.

HONDA CG 125

New Honda CG 125 is the ideal combination of elegance and power. Its speed
and performance symbolizes the true essence of modern life.
The 125 cc 4-stroke engine generates 11-Horse Power with low fuel consumption.
It is ideal for high speed, long runs and rough pathways.

HONDA CG 125 DELUXE

HONDA CG 125 DELUXE is newly launch bike of the Atlas Honda company.

It’s also a 4 stroke engine and ideal for high speed, long run and rough pathways.

It’s specially manufactured for the young people because of its excellent speed and this bike
getting good response from the youth.

2. PRICE:

The atlas Honda has four products and their prices are as under.

HONDA CD 70 Rs. 62,900

HONDA CD 100 Rs. 69,000

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HONDA CG 125 Rs. 83,400

HONDA CG 125 DELUXE Rs. 89,900

The company uses the single price strategy means the product has the same price all over the
Pakistan.
Earlier atlas Honda was the only producer of qualitative four-stroke motorcycle in Pakistan. So
they were taking the advantage of this monopolistic situation and using the price skimming
strategy and were charging highest pricing.

Up till 17th may 2003 Honda has the high prices for its product due to high prices the competitors
find a gap and entered into the market with low prices and start capturing market share by the
continuous research work company reduced it’s prices, the major reason for reducing the prices
was to increase the production and to utilize full production capacity. Now today Atlas Honda is
using above pricing strategy for its bikes.

3.PROMOTION:
Promotional mix is

• Advertisement
• Sales promotion
• Publicity
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 ADVERTISEMENT:
The atlas Honda uses the print media as well as electronic media. In print media the company
gives advertisements on news papers and also uses billboards on the road side for the promotion of
the product.
While in electronic media company gives their advertisement on GEO television channel because
now days this channel is getting more familiarity in public.

 SALES PROMOTION:
The atlas Honda also promote it’s product through different sale promotional activities.
• Company offers their product in different television game.
• Free service camps.
• They provide rewards and incentives to dealers on targets.
• ( incentives may include trips to Japan, Malaysia, Thailand.etc)

 PUBLICITY:
It is basically a non-paid form of promotion and in this the message delivered to the customer is
not in the control of the company. It may be positive or negative.

4.PLACEMENT:
Atlas Honda gained good market share due to its strong distribution network. For distribution atlas
Honda has divided the whole country into two regions.
1. South region
2. North region
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• SOUTH REGION:
The south region of Pakistan includes all the areas of Karachi and
Quetta . The area of Karachi covers whole Sindh province and the Quetta covers all of the
Baluchistan province.

• NORTH REGION:

The north region includes Multan, Lahore, Rawalpindi, and Faisalabad .

TARGET MARKET

Atlas Honda Limited taget different type of people for their different products;

Honda CD 70 Aged people from middle class family.

Honda CD 100 Aged people from middle class family.

Honda CG 125 Youth and thrill people.

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Honda CG 125 DELUXE Youth and thrill people.

Atlas Honda has a well-established finances department. It is totally computerized .it has its own
system which is prepared by IT department. Atlas Honda uses financial accounting and
cost accounting to control their finance.

Finance department has further following sections.

 FINANCE
 GENERAL LEDGER
 COSTING
 TAXATION
 PAYABLES
 PAYROLL

1). FINANCE

This section deals with the

• Banking matters
• Fund management
• Import accounting.

2). COSTING
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It is an important section of finance department which deals with all costing matters including all
material, labor, and overhead costs.

3). TAXATION
It deals with all tax and custom duty related affairs.

4). PAYABLES
This section deals with the following activities.

 Vender payables
 Utility payables
 Insurance payables
 Tax payables
 Club payments
 Other payable

6). PAYROLLS
This section controls the salary system of the organization. All the system is computerized. First of
all the attendance of all employees is recorded and at the end of the month salary of all employees
are paid after all deductions like

7). GENERAL LEDGER

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At last all the transactions are recorded in general ledgers. General ledger for each account is
maintained separately. There is a computerized system, which then produce different statements.
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SWOT NALYSIS

STRENGTHS:

• Backed by a big and financially strong group Atlas Group.

• Enjoying 55 to 60% market share at present
• Brand image
• Japanese technology
• Good service & spare parts network
• Market Leaders (60%)

WEAKNESSES:

• Cost cutting is becoming a serious problem in presence of Chinese Manufacturers

• Less Participation in Small Towns
• Paying big royalty to Japanese
• Availability of substitutes

OPPORTUNITIES:

• Opportunities for export in the developing countries

• Low quality of Chinese
• Growing market

THREATS:

• Political instability, Govt. Taxes and Chinese companies are a threat.

• Bad economics situations
• Increased prices of petrol
• Availability of cheap Chinese spare parts
• Entrance of Chinese bikes
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RECOMMENDATIONS AND SUGGESTIONS

• System, procedure even it should about after period modification to make them stylish
and according to the trends of the market.

• In AHL there should be separate research and development department R&D for the
continuous improvement in all aspects of the business of AHL.

• Technological upgrading within short span of time so that plant must to be a strategic
advantage or competitive edge not only in Pakistan but in Asia.

• Need to improve newspaper advertisement format and style.

• Inform current opportunities for job, internships etc.

CONCLUSION

As we have done management analysis on Atlas Honda Limited, it shows that AHL is the
well known company and it gives very strong competition to its competitors and it is one of the
best producers of motorcycles. Although they have some weaknesses and threats but they are
trying their level best to over come them. They have maintained a good position by their
management and they are further trying to expand their business and facilitate their customers.