Bajaj

Topics: Auto rickshaw, Bajaj Auto, Market Pages: 9 (2735 words) Published: September 3, 2013
SWOT Analysis

Let's analyze the position of Bajaj in the current market set-up, evaluating its strengths, weaknesses, threats and opportunities available. Strengths:
• Highly experienced management.
• Product design and development capabilities.
• Extensive R & D focus.
• Widespread distribution network.
• High performance products across all categories.
• High export to domestic sales ratio.
• Great financial support network (For financing the automobile) • High economies of scale.
• High economies of scope.
Weaknesses:
• Hasn't employed the excess cash for long.
• Still has no established brand to match Hero Honda's Splendor in commuter segment. • Not a global player in spite of huge volumes.
• Not a globally recognizable brand (unlike the JV partner Kawasaki) Threats:
• The competition catches-up any new innovation in no time. • Threat of cheap imported motorcycles from China.
• Margins getting squeezed from both the directions (Price as well as Cost) • TATA Ace is a serious competition for the three-wheeler cargo segment. Opportunities:
• Double-digit growth in two-wheeler market.
• Untapped market above 180 cc in motorcycles.
• More maturity and movement towards higher-end motorcycles. • The growing gearless trendy scooters and scooterette market. • Growing world demand for entry-level motorcycles especially in emerging markets.

The Inevitable Change
Bajaj on internal analysis found that it lacked -
1. The technical expertise to deliver competitive goods.
2. The design know-how.
3. And the immediate inability to support the onslaught of competitors. All these forced Bajaj to look for an international partner who could bring in technology and also offer some basic platforms to be manufactured and marketed in India. Kawasaki of Japan is a world-renowned manufacturer of high performance bikes. Bajaj entered into a strategic tie-up with Kawasaki in late 1990s to enhance its product line and knowledge up-gradation to support long-term strategies. This served the purpose of sustaining the market competition for a while. From 1996 to 2000, Bajaj invested hugely in infrastructure while simultaneously developing product design and innovation capabilities, which is the prime reason behind the energetic Bajaj of 21st century. Bajaj introduced a slew of products right from entry-level motorcycle to the high premium segment right from 2001 onwards, and since then its raining success all the way for Bajaj. Last quarter, Bajaj had impressive performance growing at a rate of 20%+ when the largest manufacturer grew at just 6%. This stands a testimony to the various important strategic decisions over the past decade. Page - 8

Tows Matrix for BAL
External FactorsInternal Factors
StrengthsWeaknesses
OpportunitiesCan use the existing R&D capabilities for new models. Can use Kawasaki's distribution networks internationally.
Can invest and grow the life style segments.Must employ the cash in production and product capabilities to match competitors and for continuous export growth. ThreatsIncrease the customer centric initiatives and command more customer loyalty. Improve the efficiency of the financing and the insurance arm. Invest in new product platforms.

Actively market electric range internationally.Invest in building world class bikes to sustain the international markets independently in the coming years like WIND 125.

Page - 8
Tows Matrix for BAL
External FactorsInternal Factors
StrengthsWeaknesses
OpportunitiesCan use the existing R&D capabilities for new models. Can use Kawasaki's distribution networks internationally.
Can invest and grow the life style segments.Must employ the cash in production and product capabilities to match competitors and for continuous export growth. ThreatsIncrease the customer centric initiatives and command more customer loyalty. Improve the efficiency of the financing and the insurance arm. Invest in new...
Continue Reading

Please join StudyMode to read the full document

You May Also Find These Documents Helpful

  • A Report on Overview of Indian Two Wheeler Industry and Bajaj Automobile Ltd. Essay
  • Bajaj Auto Limited Case Study Research Paper
  • The Bajaj Auto Essay
  • Essay on bajaj
  • Bajaj Demerger Essay
  • Bajaj Auto Ltd Swot Research Paper
  • Essay on Bajaj Pulsar Market Study
  • Bajaj Report Essay

Become a StudyMode Member

Sign Up - It's Free