Bajaj Auto Ltd.

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  • Topic: Bajaj Auto, Motorcycle, Rahul Bajaj
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  • Published : November 11, 2011
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Question Paper Integrated Case Studies – I (MB371) : October 2007 Case Study (100 Marks)
• • • This section consists of questions with serial number 1 - 7. Answer all questions. Marks are indicated against each question.

Case Study
Read the case carefully and answer the following questions: 1. “During the 1980s, BAL was the undisputed scooter king.” Examine the factors that, according to you, contributed to the near iconic status of the Bajaj/Chetak brand? (16 marks) < Answer > “By early 2000s BAL lost its title of India’s largest two-wheeler company.” Was BAL unprepared for the challenges particularly with respect to consumer satisfaction, technological innovation, competition etc.? Justify. (15 marks) < Answer > “By early 1990s it was clear that BAL had no future in the scooters segment.” a. Broadly explain the product life cycle of Chetak. b. Analyze the strategies BAL adopted to extend the life cycle of its scooters, in the changed competitive scenario. (7 + 7 = 14 marks) < Answer > “While the new launches helped the company offer a wider range of two-wheelers to its customers, they also helped it to refresh its image.” Assess the image makeover efforts of BAL. (10 marks) < Answer > 5. “In the early 2000s, with new motorcycle launches in every segment, BAL’s product portfolio changed dramatically.” Evaluate the overall product portfolio of BAL in the two-wheeler segment, 1970 onwards. (15 marks) < Answer > “In 1990s the popularity of geared scooters began to wane while that of motorcycles soared.” Discuss the economic, social and cultural factors that influenced the Indian two-wheeler market, post liberalization. (15 marks) < Answer > “Though the motorcycle had become the favorite two-wheeler of the Indian customers, most analysts did not expect the demand for scooters to disappear.” In this light, a. What is the future outlook for BAL?






b. What are the prospects for two-wheeler industry in India? (9 + 6 = 15 marks) < Answer > Bajaj Auto Ltd.: Overtaken in the Indian Scooter Market [1] “Like Volkswagen Beetle, the product (Bajaj Chetak) had lost its relevance.” – Rajiv Bajaj, MD, Bajaj Auto Ltd., in January 2006. “The scooter segment in India is over one million units and the segment has been witnessing an impressive growth for the past few months. Further, there is a huge untapped segment of women customers, which offers [2] immense growth potential.” – Pawan Munjal, MD, Hero Honda Motors Ltd., in January 2006. [3] “Fact is, Bajaj was slow in reading the shift from scooters to motorcycles.” – An article in Business Today, in 2001. INTRODUCTION

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In January 2006, Bajaj Auto Limited (BAL), a major Indian manufacturer of two- and three-wheelers, [4] announced that it had stopped production of Bajaj Chetak, its flagship scooter model. The Chetak, a geared scooter, had reigned over the Indian two-wheeler market in the late 1970s to early 1990s and had come to occupy a near-iconic status. According to Rajiv Bajaj (Rajiv), managing director, BAL, the company had produced about 10 million Chetak scooters before the model was discontinued. In the mid-1940s, BAL started as an importer of two- and three-wheelers. In the early 1960s, BAL, in [5] collaboration with Piaggio , started manufacturing Vespa brand scooters at its plant near Pune, Maharashtra. With its collaboration with Piaggio coming to an end in the early 1970s, BAL started manufacturing scooters under the Bajaj brand. The Chetak, BAL’s first scooter model under the Bajaj brand, was introduced in 1972. In the 1970s and 1980s, scooters dominated the Indian two-wheeler market. Most middle-class Indians preferred scooters...
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