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 Heralded as a milestone for the industry
 Challenged Maruti Udyog Ltd
 1 st vehicle launched in 3 versions
 Bookings reached an astonishing no
114000
 Had plans to become a 100 billion
company
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— Otiff competition from General Motors

and Ford
— Targets set by Daewoo was too high and
ambitious
— Daewoo itself was responsible for the
mess
— Daewoo is good at making cars but
rotten at marketing them
 '(")# $ "

 Founded in 1967 in Korea it was a part of Daewoo

group
 In 2001 had its operations in 123 countries
 Basically a company whish exported readymade
garments to UO
 Later diversified into trading, construction, automotive,
etc
 Automotive became one the most important ventures
 In 1977 entered into joint venture with General motors
but conflicts arouse
 In 1991 Daewoo bought out 50% stake in the venture for 50
billion
 Faced tough competition in European and us market it looked
to diversify it into eastern Europe, Latin America and Asia
 Took over 50% equity held by Japans' Toyota in DCM-TOYOTA
 Renamed it as Daewoo motors India ltd
 Dcm-Ltd again sold 24% of its stake which increased its stake
to 75% in Jan 1997 and 92% in 1998
 Overseas investment on borrowed funds
 In 2000, co·s labor union refused to accept a restructuring plan
for the company
 Daewoo was declared bankrupt
°
 

 
 


 



-An Automobile Industry Analyst, 2000

|

 "#(
 Oize and Market share.
 Quality Products.
 Technology Potential.
 Early movers advantage in India.
 @
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 Lack of a focused approach and inconsistent
policies
 Launching of the car into the Indian market
was done in an extremely hurried manner
 High import content
 Lack of proper market survey
 Poor fuel efficiency due to lack of
modification in Engine
 Did not react to customer complaints
 Tried to tackle this problem through its sales
staff but they were also not properly trained
 Daewoo assumed there was demand for cars
in mid size segment
 People tried to postpone their need to
recession in an economy.
 Focus On Numbers Not On After Oales
Oervices
 £"%#&%+%%

 In 1995 Daewoo came up with Diwali

bonanza scheme
 Reduced the finance rates to 14.33%
 Discount of 10% was given
 Test drive scheme in April 1997
 £%%#%#("""
 Company Keep on changing the
positioning of cielo
 Different positioning
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 In the free scheme people felt there was
something wrong
 Lost its image as a feature-rich, luxury
family car
 Questioned by MRTP authorities
 Termed ¶unmemorable and poor· due to
constant changes in the positioning


 



 Hefty Price Cut Of Rs 1.5 Lakh

 Launch of the ¶˜
· campaign

 !&%%#

 Ohock to competitors.

 Loss to credibility of the car.

 Loss of customer·s trust.

 Launch of ¶Val-You· Campaign.

" %&
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Dumped Without A Funeral Ceremony

@%-




  

 Oct 1998- MATIZ was launched .

 23,265 units in april-dec 1999, demand increased
by 52.2 to 35,398 units april-dec 2000
 Further CIELO took a back seat after matiz
success globally
 Replaced CIELO GLE and GLX with EXECUTIVE
and NEXIA but customers failed to see any
difference
 Advertising of CIELO stopped
 MATIZ was going places operating in 114
countries
 Failure in INDIA due to OANTRO
 

— Massive cost cutting exercise
— Reduce the working hours
— Reduce the no of workers
— Increase the use of automation
— Postpone the launch of three new cars
due to the losses
— Change the positioning of Cielo once
more
 #&)%#

We believe the chances of its success after

re-positioning is bleak

#')

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