TOPIC-BCG MATRIX OF

HYUNDAI’

BY:

AMAN KHANNA

ARNAB BASU SUBMITTED TO:

ARNAV RAZDAN ZEHRA ZULFIQ

BCG MATRIX

The BCG matrix is a tool that allows to classify and evaluate the products and services.

According to this technique , The matrix positions the products/services classified as low or high performers in two ways:

1. The rate of the growth of the market;2. The market share of a product/services

offered facing the competitors. Boston consulting group (BCG) matrix

was developed by Bruce Henderson of the Boston Consulting Group in the early 1970s.

The four cells of the BCG matrix denotes

Question mark(?), Dogs, Stars, Cash cows

BCG MATRIX is simple and easy to understand.

It helps you to quickly and simply screen the opportunities open to you, and helps you think about how you can make the most of them.

It is used to identify how corporate cash resources can best be used to maximize a company’s future growth and profitability.

To assess Profiles of products/businesses , the cash demands of products, the development cycles of products, resource allocation and divestment decisions.

Better decision making.

The model uses only two dimensions (i.e. growth and share) to assess competitive position, others are ignored.

More focus on balancing cash flows rather than other interdependencies.

More emphasis on cost leadership rather than differentiation as a source of competitive advantage.

Poor correlation between market share and profitability.

A high market share does not necessarily lead to profitability at all times.

Low share or niche businesses can be profitable too (some Dogs can be more profitable than cash Cows).

Chung Ju-Yung founded the Hyundai Engineering and Construction Company in 1947.

Hyundai Motor Company was later established in 1967.

The company's first model, the Cortina, was released in cooperation with Ford Motor Company in 1968.

In 1975, the Pony, the first Korean car, was released, with styling by Giorgio Giugiaro of ItalDesign and power train technology provided by Japan's Mitsubishi Motors.

In 1986, Hyundai began to sell cars in the United States, and the Excel was nominated as "Best Product #10" by Fortune magazine, largely because of its affordability.

Chung Ju Yung transferred leadership of Hyundai Motor to his son, Chung Mong Koo, in 1999.

Hyundai Motor Company entered the Indian Automobile Market in 1996, currently the second largest auto exporter from India.

HATCHBACK SEDAN SUV

i10 i20 Santro Eon

Verna Sonata Elantra Accent

Santa FeVeracruzTucsonTerrcan

29%

21%8%

14%

28%

Sales

Maruti

Tata

Hyundai

Honda

Others

SBU ANNUAL GROWTH(2010-

2011)

MARKET SHARE(a)

LARGESTCOMPETIT0R(b)

X= a/b

HATCHBACK 26.8% 21% 54%(MARUTI)

0.38

SEDAN 4.5% 7.7% 29.17%(MARUTI)

0.26

SUV 33.8% 1% 43%(MAHINDRA RENAULT)

0.02

For Hatchback(current placed in STARS)

Success story of Hyundai's i10 and i20 inspired the hatchback segment and took the market by storm. Its products like Eon, i10,i20, segment has entered its maturity stage. Eon has been named among top 10 cars by autocar . While its Santro gained much popularity and is still famous for its low-budget ,fuel efficiency and various models.

Special i-tech (i10 variant) has been introduced in the market on march 6,2013 marking its anniversary. Annual growth of Hyundai’s hatchbacks in year 2010-11 has been 26.8% and has market share of 21% as compared to Maruti Suzuki’s , so recommendations are as follows:

To invest more in i30 which is launching in 2014 in hatchbacks. To focus on Santro ‘s Xing segment because it is cash cow for the

hatchback segment. i 20 low priced variant should be introduced so that it can attract

every segment of buyer.

For Sedans(currently placed in question mark)

Accent has shown great promise in Sedans sector which has great market share in sedans but in totality Sedans Share is very low for Hyundai( 7.7%) . Whereas Sonata , Elantra are very low in market growth and market share.

But fluidic range of sedans are quite promising and boosted and ushered the growth in market of sedans in Hyundai. These versions has erased the previous perception of this sector and rebranding of sedans is taking place. Recommendations for the transition to stars segment is as follows:

Invest heavily in bringing new variant in sonata and Elantra.( Hyundai recently introduced the Fluidic Diesel version which is quite promising)

Extensive marketing of Elantra is the need of the time. Bringing Sedans in range of 7-8 lakhs is required to compete with

its competitors.

For SUV( currently placed in Question Marks)

Hyundai’s Santa Fe is the only SUV product of its market in India but there are 4 SUV which are produced in India and are exported from India to European countries. Its Veracruz and Tucson are one of the major seller in USA and Europe. Hyundai started production of ‘Hydrogen Powered’ ix35’ SUV in December 2012 which is the step to build its SUV portfolio. As it is correctly placed in Question mark so the recommendations are as follows:

•First of all, it should increase its portfolio by bringing in SUVs.

•It should focus on more variants of Santa fe as its market growth is very good.

• HMIL( Hyundai Motor India Limited) should look into the Asia market( especially India because it has very good prospective of its growth.

http:/www.cartoq.com/car-sales-maruti-remains-the-hatchback-leader-as-market-grows/

http://www.motorbam.com/sales-figures/august-2012-sales-figures-analysis

http://www.team-bhp.com/forum/indian-car-scene/111873-november-2011-indian-car-sales-analysis.html