1. Submitted To: Prof Hemant Purandare Submitted By: Krupal Khatri (13BSP1528) Ishita Saxena (13BSP1509) Sunny Bedi (13BSP1554

2.  Introduction  Timeline of Industry  About Hero Honda  Hero Honda’s Thrust  Rural Network  Distribution  Promotion  Retail Finance  Road Ahead

3.  Started 1984 as a joint venture between Japan based HMCL & India based HMCL.  1 st launch CD100 motorcycle.  By 2007 started expanding presence in Rural India.  In April 2009, Hero Honda planned low priced motorcycle.  Price between 12,500-15,000  Focused on low price but no compromise on quality and safety.  Strengthened rural network by increasing sales, servicing and spare part outlets in major rural areas.

4.  1952- Enfield- Motorcycle  1955- Automotive Products (API)- Scooters  Mid 1980’s – HMCL, Suzuki, Kawasaki, and Yamaha entered the market.  By 1990’s 3 divisions- scooters (60% MS), motorcycles(30%MS) and mopeds(25.8% MS).

5. 1984 Hero Group entered into joint venture agreement HMCL 1986 Bajaj Auto Limited collaborated with Kawasaki 1992 1995 1999 TVS Motors entered Joint venture with Suzuki Motors Escorts India Ltd entered Joint Venture with Yamaha Lohia Motors collaborated with Daelim Motor Company

6.  IN 1984 Hero Honda entered into a joint venture with Japan – based HMCL to manufacture motorcycle  1985- hero Honda launched its first product  Introduced fuel injection technology in India “Fill it.Shut it.Forget it”  2001- Became worl’ds largest two-wheeler company  October 2004 – hero Honda capture a market share of 48 percent

7.  2008- hero Honda continued to be world’s largest two - wheeler manufacturer.  Major three manufacturing plants in India.  Other main major player and competitor is Bajaj auto

8.  2005 – HERO HONDA entered the scooter segment with its first model, PLEASURE  Explored new segment – The young Indian women  Opened ‘Just4her’ chain of pleasure showrooms & ‘Lady rider ‘ club membership which catered to women customers  Offered attractive gifts, and discounts on spare parts of the scooter & insurance of the scooter

9. Company came up with a new marketing campaign for pleasure with a punch line ‘ why boys should have all the fun ’.

10.  The company offered several models such as :

11.  2008- hero Honda continued to be world’s largest two - wheeler manufacturer.  Major three manufacturing plants in India.  Other main major player and competitor is Bajaj auto

12.  There was global financial crisis of 2008- 09.  There was unemployment, credit crunch and declining income across the world.  Decline in the demand and sales.  Hero Honda started emphasizing on Rural markets from 2009.

13. Households in rural areas having 2 wheelers- 8%. Households in urban areas having 2 wheelers- 25%. Thus they introduced a “rural vertical” and introduced a slogan “Har Gaaon…Har Aangan. Company also concentrated on rural consumer spending.

14.  In the year 2007-08, Hero Honda covered 18000 out of targeted 23360 villages.  The company announced to cover 1,00,000 villages of total 6,00,000 villages in India by 2008-09.  Started expanding its sales network in rural areas.  Sales network in 2006-07 were 2000.  Sales network increased to 3500 till the year 2008-09.  Hero Honda also employed and trained 521 rural executives.

15.  Hero Honda followed the “Hub and Spoke System” in rural areas.  The company gave dealership to 1 dealer who will take care of the district.  Availability of services.

16.  Promoted the products aggressively during the festivals.  Dealers of Hero Honda were also told to run promotional activities.  Villagers were provided with the test drive.  Dealers also organised service camps where the motor cycle could be serviced.  Dealers also put price list on tea shops, local market, tailor shops and also in panchayat.

17.  Growth of Indian 2 wheeler was dependant on availability of retail finance.  Financial institutions gave loans to people as Hero Honda had good resale value.  Hero Honda also planned to start its own Finance division.  Entered into agreements with various banks.

18.  Many automobile manufacturers decreased the production, whereas Hero Honda increased.  In Haridwar it increased its production from 2000units per day to 3000 units per day.  Took advantage of tax benefits.  Hero Honda believed Government policies for people in rural areas will increase their sale  Sales in 2007-08 was 3.34million.  Sales in 2008-09 was 3.72million (growth of 12%).

19. Rural sales in 2007-08 was 35%. Rural sales in 2008-09 was 40%. Hero Honda also captured 57% market share in domestic motor cycle market. It expected to sell 4million vehicles in the year 2009-10 as compared to 3.72million in the year 2008-09.