Tata Magic vs Three Wheelers

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SUMMER INTERNSHIP REPORT A COMPARATIVE STUDY

TATA Magic & Three wheelers

SUBMITTED TO: SUBMITTED BY:

IPM (Meerut) M. Absar

PGDM (Marketing)

IPM Meerut

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PREFACE

Any training programme sharpens those instincts, which serves as a fulfillment of theoretical grounding. As the present day business world is a highly complex one where Human Ingenuity and Acumen is sharpened by highly specialized knowledge in various branches pertaining the running and conducting. The research project in our basket was- comparative analysis of TATA Magic and Three wheelers. The research was based upon certain objectives such a; To determine the viability of TATA Magic in various routes of Ranchi, To determine the operating economies of TATA Magic in various routes etc.

To fulfill the objective of the research various auto stand has been surveyed and different routes of Ranchi was travelled to gain the practical experience and to know the actual scenario of the Market.

Research is a feedback that any organization sought for the purpose of effective policy and decision making. It is the systematic problem analysis, model building & fact finding for the purpose of important decision-making & control in the making of goods and services. Summer Project is a part of our curriculum so that we get exposed to the practical side our theoretical know-how. This is basically designed to the real life situation. In this training programmed, the students use their academic knowledge practically which polishes the decision making abilities of MBA graduates. For developing healthy managerial and administrative skills of potential managers it is necessary that theoretical knowledge must be supplemented with exposure to real life business environment. It is a practical training that the measuring itself is realized.

Conventional academic medium cannot sell anything practically down to real and practical market knowledge is required to make a hard core corporate. This research work gave me the opportunity to apply conceptual skills in practice and to learn the art of conducting study and presenting its findings in a systematic and scientific way.

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ACKNOWLEDGEMENT

Today’s environment accomplished by any academic or professional pursuit

requires contribution from various individuals. The same is true in the case

of this summer training project of mine. I want to express our deep sense of

gratitude for Institute of Productivity and Management, Meerut, for providing

me with the opportunity to investigate what i have found to be an extremely

interesting project and prepare a report for the same.

I would like to thank Mr. ASIT MOHAN, Director and Mr. SARAVJEET

SINGH, Deputy Director, IPM, MEERUT, who arranged our Summer Training

in a reputed Business Institution, namely, TATA MOTORS LIMITED.

I would like to thanks MR. ASHISH MEHTA Territory sales manager and

Mr. SUBASISH GANGULY Area sales manager TATA MOTORS LIMITED

who has been in-charge of guiding and handling my SUMMER INTERNSHIP

PROGRAMME.

We sincerely acknowledge the help, encouragement and valuable suggestion

to our family members, our friends and all those people (respondents) who

were patient enough to answer to our questions, without their guidance and

active support we would not have been able to complete this report

successfully.

Thank You All

M.Absar

PGDM (Marketing)

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TABLE OF CONTENTS

EXECUTIVE SUMMARY 1

THE INDIAN AUTOMOBILE INDUSTRY 2

COMPANY OVERVIEW 8

PRODUCT LINE OF TATA MOTORS LIMITED 14

PRODUCT PROFILE (TATA MAGIC) 15

SWOT ANALYSIS OF TATA MAGIC 18

COMPETITORS OVERVIEW 19

OBJECTIVE OF STUDY 21

RESEARCH METHODOLOGY 22

METHODS OF DATA COLLECTION 23

AWARNESS PROGRAMME 24

SURVEY ANALYSIS 29

COMPARATIVE ANALYSIS 35

DEALER ANALYSIS 47

OPERATING ECONOMIES COMPARISION 60

FINDINGS 71

ADVANTAGES 72

STRATEGIC RECCOMENDATIONS 73

CONCLUSIONS 74

LIMITATIONS 75

ANNEXURES 76

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EXECUTIVE SUMMARY

The project is based on comparative analysis between TATA Magic and other three wheelers. A research has been made for checking the viability of TATA MAGIC in SCV section. The work done for completion of the research involves all steps of effective marketing research

We received brochures from the regional office Ranchi which we went through to know about the specification about Magic. At the same time we also gathered information regarding the competitors of TATA Motors in this segment. We came to the conclusion that Piaggio Ape, Mahindra Alfa, Bajaj Mega and Force Minidor are the main competitors in the state of Jharkhand. We collected information of the competitors from net and studied them.

Further we collected information in the form of questionnaires pertaining to TATA MAGIC and their main competitors. The information is collected from different auto stands in Ranchi.

To know the consumer’s response on the utility of these vehicles and viability of Magic in different routes a survey was conducted on few auto stands in Ranchi, we also travelled in TATA Magic and other three wheeler to determine the operating economies in various routes to make a comparison between the earning per day. All the responses were collected from drivers and owners. These responses were noted down and analyzed with the help of charts and thus conclusions were drawn.

After analyzing the data and responses collected appropriated recommendations were given to our project guide.

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THE INDIAN AUTOMOBILE INDUSTRY

Indian automobile industry is the seventh largest in the world with an annual production of over 2.6 million units in 2009. India emerged as Asia's fourth largest exporter of automobiles, behind Japan, South Korea and Thailand in the year 2009. By 2050, the country is expected to top the world in car volumes with approximately 611 million vehicles on the nation's roads.

Following economic liberalization in India in 1991, the Indian automotive industry has demonstrated sustained growth as a result of increased competitiveness and relaxed restrictions. Several Indian automobile manufacturers such as Tata Motors, Maruti Suzuki and Mahindra and Mahindra, expanded their domestic and international operations. India's robust economic growth led to the further expansion of its domestic automobile market which attracted significant India-specific investment by multinational automobile manufacturers. In February 2010, monthly sales of passenger cars in India exceeded 100,000 units.

Embryonic automotive industry emerged in India in the 1940s. Following the independence, in 1947, the Government of India and the private sector launched efforts to create an automotive component manufacturing industry to supply to the automobile industry. However, the growth was relatively slow in the 1950s and 1960s due to nationalization and the license raj which hampered the Indian private sector. After 1970, the automotive industry started to grow, but the growth was mainly driven by tractors, commercial vehicles and scooters. Cars were still a major luxury. Japanese manufacturers entered the Indian market ultimately leading to the establishment of Maruti Udyog. A number of foreign firms initiated joint ventures with Indian companies.

In the 1980s, a number of Japanese manufacturers launched joint-ventures for building motorcycles and light commercial-vehicles. It was at this time that the Indian government chose Suzuki for its joint-venture to manufacture small cars. Following the economic liberalization in 1991 and the gradual weakening of the license raj, a number of Indian and multi-national car companies launched operations. Since then, automotive component and automobile manufacturing growth has accelerated to meet domestic and export demands.

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Today, the Indian automobile industry is ranked first in the world in the production of three wheelers, second in the production of two wheelers, fourth in the production of commercial vehicles and ninth in the production of passenger vehicles. With a production of more than 11 million vehicles in FY08-09, the Indian automotive industry has shown an outstanding resilience after the last down cycle about a decade back. In the last few years, the Indian automotive industry has grown at a healthy rate by reducing costs and improving efficiency. With its new found confidence, it has gone beyond the shores of India and is creating a noteworthy footprint in different geographies in the world.

The Indian automotive market with a healthy growth rate of 14% in the last 7 years (as on FY08-09) was a source of attraction to many foreign automobile companies whose entry in the Indian market not only increased competition, but also raised customer expectations about product quality and reliability. This forced the Indian companies to introduce new and interesting products and innovation has now become a notable feature of the Indian automobile industry.

The automobile industry consisting of cars, trucks, buses, two-wheelers and three-wheelers, is vital to the growth of the Indian economy. In the last decade their share in the Indian economy is around 5% of GDP. Economic progress is indicated by the amount of goods and services produced which give the impetus for transportation and boost the sale of vehicles. Increase in automobile production has a catalyst effect by indirectly increasing the demand for a number of raw materials like steel, rubber, plastics. Since transportation is the nerve center of every other industry, the well being of the automobile industry is a good indicator of the health of the economy. Economic studies have shown that every truck manufactured creates anywhere between eight to twelve jobs and a bus would create around seven, which would include salespeople, drivers, mechanics, cleaners and servicing staff.

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Before Independence

Before independence India was seen as a market for imported vehicles. The assembling of cars manufactured by General Motors and other leading brands was the order of the day. Indian auto industry focused on servicing, dealership, financing and maintenance of vehicles. Manufacturing started only after a decade from independence. After Independence

Till the 1950s the Indian Railways played a pivotal role in meeting India's transportation needs. The railways used to carry 90 per cent of the total freight, while road transport accounted for the balance. But in the current context the dynamics have changed. Surface transport accounts for 65% of freight movement and 80% of passenger movements. The slow growth of railway infrastructure has been partly due to administrative reasons, partly due to difficulty in acquiring land and partly due to high capital cost involved for every additional railway line. The Indian automobile industry faced several challenges and road blocks to growth since independence. Manufacturing capability was restricted by the rule of license and could not be increased. The total production of passenger cars was limited to 40,000 a year for nearly three decades. This production was also confined to three main manufacturers Hindustan Motors, Premier Automobiles and Standard Motors. There was no homegrown expertise or research & development initiative. It was difficult to import scientific know how and vital spare parts and cumbersome to recruit foreign technical experts.The pricing was kept under control by the government. Here was the contradiction, a passenger car was thought to be a premium product only for the rich, yet it came under the purview of protection of a socialist regime. Initially labor was unskilled and had to go through a process of learning through trial and error. But to the credit of these workers, it was they who developed the skill set required for future expansion in the industry. The earlier automobiles were a domestic version of prominent International Brands. The Morris Oxford popular in the 1950s, became the Ambassador, the Fiat 1100 became the Premier Padmini. By 1960s nearly 98% of the product was developed indigenously.

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By the end of 1970s, significant changes in the automobile industry were witnessed. Initiatives like joint ventures for light commercial vehicles did not succeed. New models like Contessa, the Rover and the Premier 118NE, hit the market. Socialistic Pattern Of Growth

India by and large followed a socialist system till the later part of 1980s.The government focused on development through heavy, long gestation, capital intensive projects like steel manufacturing. The quality of the finished good and customer feedback were not given much priority. As a result the country missed a golden opportunity to accelerate to a faster growth trajectory by at least 2 decades. The Pioneering Achievements

Mr. J.R.D Tata's role in the development of the Indian automobile industry has to be mentioned. The Tata group set up a high standard Engineering Research Centre (ERC) in 1965 to facilitate technological advancement. Mr. Tata pioneered the indigenization of scientific knowledge for trucks in collaboration with Mercedes Benz. The launch of Maruti 800 in 1983 changed the dynamics of the passenger car sector in India. It was also known as the people’s car. Stability In The Market The Indian automobile industry has come a long way since independence. From being an importer of automobiles to a manufacturer. From having minimum foreign collaborations to joint ventures. This attribute cannot be considered as a weakness, but as sharing of best practices. This phenomenon can be compared to the business collaboration in the outsourcing industry.

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The Future

The Indian automobile industry is expected to grow to US$ 40 billion by 2015 from the current level of US$ 7 billion in 2008. By the year 2016 the industry is expected to contribute 10% of the nation’s GDP. The industry manufacturers over 11 million vehicles a year, employing more than three million people.

The greatest challenge and competition would be from the Chinese automobile industry. The Chinese automobile industry has been able to give stiff completion to India in terms of productivity, cost of manufacturing and technology. Again the present trend of excess manufacturing capability, reduced margins put additional pressure on the industry.

The global recession has had a dampener effect on the growth of the industry, but market experts believe it is only a short term phenomenon and are confident of the industry bouncing back.

On the positive side, India’s strength in software sector, combined with skilled labor and low cost of manufacturing should place it in a favorable position globally.

Recently Ratan Tata, Chairman (Tata Motors) created history by launching the world's cheapest car NANO. The cars pricing is around one lakh, gaining instant recognition in the automobile industry across the globe. It heralded the coming to age of the Indian Automobile Industry.

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CURRENT SCENARIO OF INDIAN AUTOMOBILE INDUSTRY:

*Source: SIAM (Society Of Indian Automobile Manufacturers)

16%

4%4%

76%

DOMESTIC MARKET SHARE '09- '10

PASSENGER VEHICLE

COMMERCIAL VEHICLE

3 WHEELER

2 WHEELER

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COMPANY OVERVIEW

Tata Motors Limited is India's largest automobile company, with consolidated revenues of Rs.70,938.85 crores (USD 14 billion) in 2008-09. It is the leader in commercial vehicles in each segment, and among the top three in passenger vehicles with winning products in the compact, midsize car and utility vehicle segments. The company is the world's fourth largest truck manufacturer, and the world's second largest bus manufacturer.

The company's 24,000 employees are guided by the vision to be "best in the manner in which they operate best in the products they deliver and best in their value system and ethics."

Established in 1945, Tata Motors' presence indeed cuts across the length and breadth of India. Over 5.9 million Tata vehicles ply on Indian roads, since the first rolled out in 1954. The company's manufacturing base in India is spread across Jamshedpur (Jharkhand), Pune (Maharashtra), Lucknow (Uttar Pradesh), Pantnagar (Uttarakhand) and Dharwad (Karnataka). Following a strategic alliance with Fiat in 2005, it has set up an industrial joint venture with Fiat Group Automobiles at Ranjangaon (Maharashtra) to produce both Fiat and Tata cars and Fiat power trains. The company is establishing a new plant at Sanand (Gujarat). The company's dealership, sales, services and spare parts network comprises over 3500 touch points; Tata Motors also distributes and markets Fiat branded cars in India.

Globalization

Tata Motors, the first company from India's engineering sector to be listed in the New York Stock Exchange (September 2004), has also emerged as an international automobile company. Through subsidiaries and associate companies, Tata Motors has operations in the UK, South Korea, Thailand and Spain. Among them is Jaguar Land Rover, a business comprising the two iconic British brands that was acquired in 2008. In 2004, it acquired the Daewoo Commercial Vehicles Company, South Korea's second largest truck maker. The rechristened Tata Daewoo Commercial Vehicles Company has

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launched several new products in the Korean market, while also exporting these products to several international markets. Today two-thirds of heavy commercial vehicle exports out of South Korea are from Tata Daewoo. In 2005, Tata Motors acquired a 21% stake in Hispano Carrocera, a reputed Spanish bus and coach manufacturer, and subsequently the remaining stake in 2009. Hispano's presence is being expanded in other markets. In 2006, Tata Motors formed a joint venture with the Brazil-based Marcopolo, a global leader in body-building for buses and coaches to manufacture fully-built buses and coaches for India and select international markets. In 2006, Tata Motors entered into joint venture with Thonburi Automotive Assembly Plant Company of Thailand to manufacture and market the company's pickup vehicles in Thailand. The new plant of Tata Motors (Thailand) has begun production of the Xenon pickup truck, with the Xenon having been launched in Thailand in 2008.

Tata Motors is also expanding its international footprint, established through exports since 1961. The company's commercial and passenger vehicles are already being marketed in several countries in Europe, Africa, the Middle East, South East Asia, South Asia and South America. It has franchisee/joint venture assembly operations in Kenya, Bangladesh, Ukraine, Russia, Senegal and South Africa.

The foundation of the company's growth over the last 50 years is a deep understanding of economic stimuli and customer needs, and the ability to translate them into customer-desired offerings through leading edge R&D. With over 3,000 engineers and scientists, the company's Engineering Research Centre, established in 1966, has enabled pioneering technologies and products. The company today has R&D centers in Pune, Jamshedpur, Lucknow, Dharwad in India, and in South Korea, Spain, and the UK. It was Tata Motors, which developed the first indigenously developed Light Commercial Vehicle, India's first Sports Utility Vehicle and in 1998, the Tata Indica, India's first fully indigenous passenger car. Within two years of launch, Tata Indica became India's largest selling car in its segment. In 2005, Tata Motors created a new segment by launching the Tata Ace, India's first indigenously developed mini-truck

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Recent Ventures:

In January 2008, Tata Motors unveiled its People's Car, the Tata Nano, which India and the world have been looking forward to. The Tata Nano has been subsequently launched, as planned, in India in March 2009. A development, which signifies a first for the global automobile industry, the Nano brings the comfort and safety of a car within the reach of thousands of families. The standard version has been priced at Rs.100,000 (excluding VAT and transportation cost).

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In May 2009, Tata Motors introduced ushered in a new era in the Indian automobile industry, in keeping with its pioneering tradition, by unveiling its new range of world standard trucks called Prima. In their power, speed, carrying capacity, operating economy and trims, they will introduce new benchmarks in India and match the best in the world in performance at a lower life-cycle cost.

Corporate Social Responsibilities

Tata Motors is equally focused on environment-friendly technologies in emissions and alternative fuels. It has developed electric and hybrid vehicles both for personal and public transportation. It has also been implementing several environment-friendly technologies in manufacturing processes, significantly enhancing resource conservation.

Tata Motors is committed to improving the quality of life of communities by working on four thrust areas – employability, education, health and environment. The activities touch the lives of more than a million citizens. The company's support on education and employability is focused on youth and women. They range from schools to technical education institutes to actual facilitation of income generation. In health, its intervention is in both preventive and curative health care. The goal of environment protection is achieved through tree plantation, conserving water and creating new water bodies and last but not the least, by introducing appropriate technologies in its vehicles and operations for constantly enhancing environment care.

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Core Purpose, Value and Vision & Mission

PurposeTo create economic assets for road transportation for bulk movements of goods and people andparticipate

in managing these overthe life of assets in

order to create andcapture

economic assets.

Our VisionTo be a world class corporate

constantly furthering the interest of all its stakeholders.

O

Our Core Values Integrity

Customer focusCorporate Citizenship

Passion for Engineering

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Our Mission

Shareholders

To consistently create shareholder value by generating returns in excess of weighted average Cost of Capital during the upturn and at least equal to weighted average cost of capital during the downturn of the business cycle.

Customers

To strengthen the TATA brand and create lasting relationships with the customers by working closely with business partners to provide superior value for money over the life cycle.

Employees

To create a seamless organization that incubates and promotes innovation, excellence and the Tata core Values

Vendor and Channel Partners

To foster a long term relationship so as to introduce a broad range of innovative products and services, that would benefit our customers and other stakeholders.

Community

To proactively participate in reshaping the country’s economic growth. To take a holistic approach in environmental protection.

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PRODUCT LINE OF TATA MOTORS LIMITED

PASSENGER CARS

TRUCKS

UTILITY VEHICLES

COMMERCIAL PASSENGER CARRIERS

INDICA VISTA

INDICA V2

INDIGO XL

INDIGO MARINA

INDIGO CS

INDIGO MAANZA

INDICA VX XETA

FIAT CARS NANO

SAFARI DICOR

SUMO GRANDE

SUMO XENON XT

MEDIUM & HEAVY COMM.

PRIMA

CONTRUCK

TATA NOVUS

INTERMEDIATE COMM. VEHICLE

TL 4*4

LIGHT COMMERCIAL VEHICLES

SMALL COMMERCIAL VEHICLES

BUSSES WINGER MAGIC

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PRODUCT PROFILE (TATA MAGIC)

The Tata Magic is a Micro van launched by Tata Motors in June 2007. The Magic is the passenger version of the Ace mini-truck; the new Magic features an all-steel cabin. It offers a flexible seating capacity of 4-7 passengers with adequate legroom. Powered by a 16 bhp (12 kW), 702 cc water-cooled diesel engine, the Magic offers high fuel efficiency and very low maintenance. The 12-inch tyres provide higher ground clearance, and the rigid front axle is designed to handle tough roads. The Magic's turning radius of 4.3 meters (14.1 ft) is nimble enough to navigate the bylines and traffic of India's crowded cities. The Magic has a clearly visible instrument cluster, utility tray and a digital clock in the dashboard and also a provision for fitting a radio.

The Magic meets BS-III emission norms and has been developed for use in any market — be it urban, semi-urban or rural. It is backed by a 36,000 km/12-month warranty. The Magic range starts at Rs 2.90 lakh (ex-showroom).Magic had being launched nation-wide, starting with Maharashtra and Gujarat, after which availability was extended to other parts of the country in a phased manner.

Whether it is a hub town or a village, the Magic can very well ferry passengers with ease and comfort. The rigid front axle of this vehicle has specifically been designed keeping in mind the Indian conditions. It can very well and safely navigate through the narrow countryside streets or roads where it seems difficult for other vehicles to do so. As far as safety is concerned, the Magic meets all the safety norms. There is absolute safety for drivers and passengers, as it incorporates door intrusion beams, seatbelts for drivers and passenger cabin and vacuum assisted brakes for excellent braking performance and large windscreen for better driving visibility. In addition to this, it meets all the safety standards for static roll over and roof crush because of its hard top and tubular construction. Above all, you can have an easy and safe reversing because of the two box tail lamp with an inbuilt reflector and a bright reverse lamp.

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TATA MAGIC PASSENGER

1. ENGINE Model TATA 275 IDI NA Type 4- stroke, naturally aspirated, indirect

injection diesel engine Max Output 16hp @3200 rpm Max. Torque 38 nm @2000rpm Displacement 702 cc 2. CLUTCH Single Plate dry Friction diaphragm type

170 dia 3. GEAR BOX GBS 65-4/6.31 Type Synchromesh (4 forward gears), Sliding

Mesh(reverse gear) Front Axle Rigid Beam Shaped Rear Axle Single Reduction, High powered gears

and semi-floating axle 4. STEERING Mechanical, Variable Ratio (20.5 to 24.5),

380 mm dia 5. BRAKES Type Vacuum Assisted Dual circuit

hydraulically activated Front Disc Brakes

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Rear Drum Brakes (200mm dia×30mm)

6. SUSPENSION Shock Absorber Hydraulic double – acting telescopic type Type Parabolic Leaf Spring Suspension at both

front and rear WHEELS AND TYRES Tyres 145 R 12 LT 8 PR RADIAL 7. DIMENSIONS (MM) (MM) Length 3790 Width 1500 Height 1845 (unladen) Wheelbase 2100 Front Wheel Gauge 1300 Rear Wheel Gauge 1320 Inside Length 2212 Inside Width 1220 Height of Side Panels 300 Ground Clearance 160 Minimum Turning Circle

Diameter 4.3m

8. FUEL TANK CAPACITY 30 litres PERFORMANCE Max. Speed 64 kmph. Max. Gradability 22% Grade Restartability 21% 9. WEIGHTS Max. GVW 1600 kg Kerb Weight 1000kg Seating Capacity Driver + 7 10. Security Measures On Hinge Doors Pop Up Nob for Side Doors Others Static Role over tested capacity Specific Reflex Reflectors and Door Intrusion

Beams

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SWOT ANALYSIS

A scan of the internal and external environment is an important part of the strategic planning process. Environmental factors internal to the firm usually can be classified as strengths (S) or weaknesses (W), and those external to the firm can be classified as opportunities (O) or threats (T). Such an analysis of the strategic environment is referred to as a SWOT analysis.

The SWOT analysis provides information that is helpful in matching the firm's resources and capabilities to the competitive environment in which it operates. As such, it is instrumental in strategy formulation and selection.

The SWOT Analysis of Tata Magic is as shown in the figure:

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COMPETITORS OVERVIEW

Until a decade ago, the auto sector in India had been a relatively protected industry limiting the entry of foreign companies with high tariffs against imports. Today, as part of a broader move to liberalize its economy, India has opened up the sector to Foreign Direct Investments, and since then has also progressively relaxed trade barriers. Today, almost all of the major global companies are present in India producing two-wheelers and passenger cars in almost all segments.

Over the years the world has been witnessing tremendous development in the sector of automobile industry. With their advanced engineering techniques, the major auto giants like Tata, Maruti, General Motors, Hyundai, Mitsubishi etc have come up with most sophisticated vehicle that a human mind could have hardly imagined just a few years ago. It is not only the cars, consumer vehicles and two wheelers are also been sold in large numbers, but the three wheeler market is also quite big in the south east nations. We can see innumerable three wheelers running on the roads of various Southeast Asian countries like India, Thailand Sri Lanka, Pakistan, Philippines, Nepal, Bangladesh etc.

There are a number of reasons that have resulted into the proliferation of three wheelers in umpteen countries. Three wheelers are quite economical in terms of manufacturing and maintenance. They have also earned huge popularity due to their easy maneuvering capabilities through the narrow lanes that are prevalent in most of the developing countries.

The two and four wheelers are quite a hit all around the world. The two wheelers have undergone significant transformation resulting in categories like scooters, mopeds and motorcycles, the four wheelers also have come up with different shape, size design and forms and also have evolved into so many forms with light and heavy commercial vehicles. However it is the three wheeler segment of the automobile that has lagged behind.

No wonder, as against them, the number of popular three wheeler manufacturers is quite limited and in India, One comes across only three leading three wheeler manufacturers. The leading three wheeler manufactures in India are Bajaj Auto, Mahindra & Mahindra, the Italy based

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Piaggio and Force Minidor. While Bajaj Auto is one of the leading name in the Indian two wheeler segment and Mahindra & Mahindra is known more for its jeeps like Bolero and Scorpio.

In the three wheeler segment, the classification is broadly in terms of cargo and passenger vehicles. Since the former does have a very limited capacity to carry goods and is not preferred by many, the three wheeler manufacturers are more into the passenger three wheelers. Bajaj Auto has a range of models for passenger three wheelers namely RE 2S, RE 4S, RE 4S CNG, RE4S LPG, RE Diesel and RE Diesel Mega while its existing cargo is called GC1000.

Mahindra & Mahindra has got the Champion range of three wheelers. There are Champion pick up and Champion delivery vans while the Champion Passenger carriers is mostly seen in the western parts of the country. The Alfa three wheeler carriages of the Mahindra & Mahindra has a wide and tall cabin, heavy duty gear box, unique designed chassis and hydraulic shock absorbers.

The Italian auto major Piaggio manufactures Ape 50 in association with Bajaj Auto at Pune with 150cc engine. This three wheeler has different body forms and matches the specifications of various countries wherever it is produced.

Force Motors Limited is an automobile company, which was earlier known as Bajaj Tempo Limited. The name change has been effected from 21st February, 2006. The company possesses expertise in the design, manufacture and development of its comprehensive range of automobile components, vehicles and aggregates. Three wheelers from Force Motors Limited come as the Minidor family. The Minidor family comprises a host of customized three wheelers. These vehicles are beautifully engineered. The three wheelers from Force Motors are economical, eco-friendly and tough ones. These vehicles are efficient transport options for humans and goods alike.

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OBJECTIVES OF STUDY

DEALER ANALYSIS OF TATA MAGIC

TO DETERMINE THE VIABILITY OF TATA MAGIC IN DIFFERENT

ROUTES.

TO COMPARE THE OPERATING ECONOMY OF TATA MAGIC AND

OTHER THREE WHEELERS.

TO ANALYZE DIFFERENT ATTRIBUTES OF TATA MAGIC.

TO CREATE AWARENESS ABOUT THE BENEFITS OF TATA MAGIC.

TO FIND OUT THE CHALLENGES FACED.

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METHODOLOGY

Research methodology is a way to systematically solve the research problems.

When we talk about the research methodology we don’t talk about the research

method but also consider the logic behinds the method use in the context of

research results are capable of beings evaluated either by the researcher himself

or by others.

Here the work in our baggage to accomplish is to Study of TATA Magic vis-a-vis

its competitors. The methodology plays a dominant role in any research work.

The effectiveness of any research work depends upon the correctness and

effectiveness of the research methodology.

Here i have used Descriptive Research Design i.e. formulating a problem from

more precise investigation. In this type of research method researchers are

supposed to understand the problems under research, it is done for

understanding and knowing new phenomenon. It helps in segmenting and

targeting markets which are favorable for the company; in some cases describing

the situation may provide information and many other findings, all that is needed

to solve business problems. The major emphasis in such studies is on the

discovery of the ideas and insights. Research design for such studies must be

flexible enough to provide opportunity for considering different aspects of the

problem under study.

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METHODS OF DATA COLLECTION

Primary Data collection:--Collection of Data and opinion from

existing Customers and the competitors.

Secondary Data collection: -- Collection of data from internet

and study material and brochures.

Data collection from the RTO (regional transport office)

Qualitative Analysis of the data collected:

A standard set of questionnaires would be designed and distributed to

various people who are either owners or drivers or both. To study the

analysis about customer’s awareness, satisfaction and requirement of TATA

Magic along with the competitors.

Hence methodologies of my project would include:

Open ended questionnaire.

Close ended questionnaire.

Personal interviews and informal discussions.

Random sample survey of customers

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AWARENESS PROGRAMME

Sample Design

Sample Size 60

Target Population

Commercial vehicle owners

Auto drivers

Common public

Location State of Jharkhand (Dhurva)

Duration of the surveys One day

Type of information structured

Information given Shown below

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INFORMATION PROVIDED:

On road price

Discount being provided by the dealer

Benefits

Safety features

Feature comparison with the competitors

Offered test drive

Finance option

Different routes where Magic can run

AND TOOK FEEDBACK FROM EXISTING CUSTOMERS.

Safest features:

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Rollover test

The vehicle rolled over from a 800mm height platform on to the hard ground. This test is mandatory only for buses. MAGIC need not comply with this standard but has been developed to meet this requirement in order to ensure adequate safety for occupants.

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TATA MAGIC WITH SMALL 3-WHEELER

S.No Parameters Ape Magic Advantages

1 Engine Capacity (cc) 395 (1 Cyl) 702 (2 Cyl) Reliable Engine, Lesser Maintenance

2 Engine Power (HP) 8 16 More Power, More Speed

3 Torque (NM) 16 38 More Pulling power, lesser gearshifts

4 Fuel Tank (ltrs) 10 30 More distance without refueling

5 Speed (Kmph) 50 64 Faster Turnaround, More Trips

6 No. of seats 3 6 & 7 More Passengers, More Earning

7 Position of Engine Rear Front More Passenger Comfort

8 No. of Wheels 3 4 More Safety

9 Rollover Test No Yes More Safety

10 Roof Top Soft Hard More Safety

11 Shower Proof No Yes All weather proof

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TATA MAGIC WITH LARGE THREE WHEELERS

Sl Parameters Vikram Champion Magic Advantages

1 Engine cc 510 (1 Cyl) 510 (1 Cyl) 702 (2 Cyl) Reliable Engine, Lesser Maint.

2 Engine Power (HP)

10 10 16 More Power, More Speed

3 Torque (NM) 22 27 38 More Pulling power, lesser gearshifts

5 Fuel Tank (Ltrs)

10 10 30 More distance without refueling

6 Speed (kmph) 54 54 64 Faster Turn, More Trips

7 No. of seats 6 6 7 More Pass., Higher Earning

8 Position of Engine

Rear Rear Front More Passenger Comfort

9 No. of Wheels 3 3 4 More Safety

10 Tyre Size 10” 10” 12” Better Grip & Stability

11 Rollover Test No No Yes More Safety

12 Roof Top Hard Soft Hard More Safety

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SURVEY ANALYSIS

SAMPLE DESIGN

DETAILS OF THE SURVEY CONDUCTED

Sample Size 91

Target Population Auto drivers

Owner and driver

Location Ranchi Auto stands

Duration of the surveys 20 days

Type of questionnaire Structured

No. of Questions involved 15

34

1. No. of vehicles surveyed in different stands:-

Stand location

In percentage

In numbers

Booty More 7% 6 ITI 6% 5 Park 2% 2 Kutchary 33% 32 Deepatoli 7% 6 Ratu Road 2% 2 Dhurva 8% 7 Hatia 8% 7 Hotwar 6% 5 kanta Toli 11% 10 Namkum 4% 4 Tatisilve 6% 5

7%

6% 2%

33%

7%2%

8%

8%

6%

11%

4%6%

Booty More

ITI

Park

Kutchary

Deepatoli

Ratu Road

Dhurva

Hatia

Hotwar

kanta Toli

Namkum

Tatisilve

35

2. Number of vehicles surveyed:-

Type of vehicle In

percentage In

numbers Mgic 23% 21

Minidor 25% 23 Piaggio 52% 47

23%

25%

52%

Mgic

Minidor

Piaggio

36

3. Type of respondents:-

Type of respondent In percentage In numbers

Driver 55% 50

Owner and Driver 45% 41

55%

45%Driver

Owner and Driver

37

4. Average. number of passengers:-

Type of vehicle Avg. Number of passengers

Magic 12

Piaggio 9

Monidor 10

0

2

4

6

8

10

12

14

Magic Piaggio Monidor

Avg. No. of passengers

38

5. Mileage

Type of vehicle Km/per liter

Magic 14

Piaggio 26

Minidor 18

0

5

10

15

20

25

30

Magic Piaggio Minidor

Km/per liter

39

COMPARATIVE ANALYSIS

1. DESIGN:

ANALYSIS: With the existing design of TATA MAGIC 2% were strongly

disagreed and 64% were strongly agreed that the design of TATA MAGIC is

better than its competitors because of its car like interiors and steel body.

2% 2% 4%

7%

21%

64%

DESIGN

STRONGLY DISAGREE

DISAGREE

SOMEWHAT DISAGREE

SOMEWHAT AGREE

AGREE

STRONGLY AGREE

40

2. SEATING CAPACITY:

ANALYSIS: Out of the total respondent 88% were strongly agreed that the

seating capacity in TATA MAGIC is more than its competitors. And rest 12%

who were somewhat disagree were trekker and commando owners or

drivers. And for driver seat MAGIC has got 20% more cabin space.

12%

88%

SEATING CAPACITY

SOMEWHAT DISAGREE

STRONGLY AGREE

41

3. PICK UP :

ANALYSIS: Out of the total respondent surveyed majority ( 43%) were

strongly disagree that the TATA MAGIC has a better pick up as compare to

its competitors whereas only 14% were somewhat agree that pick up of the

vehicle is not really worse.

43%

25%

18%

14%

PICK - UP

STRONGLY DISAGREE

DISAGREE

SOMEWHAT DISAGREE

SOMEWHAT AGREE

42

4. SPEED:

ANALYSIS: Comparing the speed of TATA MAGIC with its competitors, 64%

of the respondents were strongly agreed that it has more speed than its

competitors and none of them were at all disagreed as it has 10kmph more

speed than its competitors.

36%

64%

SPEED

AGREE

STRONGLY AGREE

43

5. COMFORTABILITY:

ANALYSIS: Having different seat for driver, car like seat for passengers and

20% more cabin space has lead 61% of respondent to say that TATA MAGIC

has more comfortable seats for driver as well as passengers than its

competitors.

3%12%

24%61%

COMFORTABILITY

CAN'T SAY

SOMEWHAT AGREE

AGREE

STRONGLY AGREE

44

6. DURABILITY:

ANALYSIS: By looking at the above chart we can say that 43% of the

respondents agreed that TATA MAGIC has more durability than its

competitors because some of them are MAGIC users and also because of the

brand name of TATA.

18%

14%

43%

25%

DURABILITY

CAN'T SAY

SOMEWHAT AGREE

AGREE

STRONGLY AGREE

45

7. PROFITABILITY:

ANALYSIS: 50% of the respondents were strongly agreed that TATA MAGIC

is more profitable than other vehicle of segment because of more sitting

capacity, low maintenance cost and more numbers of trips as the maximum

speed of the vehicle is more as compared to its competitors.

11%

18%

21%

50%

PROFITABILITY

CAN'T SAY

SOMEWHAT AGREE

AGREE

STRONGLY AGREE

46

8. SAFETY:

ANALYSIS: Four wheels, steel body, hard top and cover from all sides are

major points for which 71% of respondents were strongly agreed that TATA

MAGIC is safer than its competitors.

11%

18%

71%

SAFETY

SOMEWHAT AGREE

AGREE

STRONGLY AGREE

47

9. INCREASE IN SOCIAL STATUS:

ANALYSIS: Being a four wheeler vehicle, TATA MAGIC increases the social

status of the user as it gives the car type feelings. Thus majority of

respondent (78%) strongly agreed that MAGIC as compared to its

competitors increases their social status.

4%18%

78%

INCREASE IN SOCIAL STATUS

SOMEWHAT AGREE

AGREE

STRONGLY AGREE

48

10. SERVICE AT SERVICE STATION:

ANALYSIS: 43% of the respondents were agreed that the service provided

by authorized service station and the availability of the spare parts of TATA

MOTORS are much better and easily available than its competitors. 21%

those who could not say about the service provided at service station were

the respondents who never used any TATA MOTORS product.

7%

21%

29%

43%

SERVICE AT SERVICE STATION

SOMEWHAT DISAGREE

CAN'T SAY

SOMEWHAT AGREE

AGREE

49

11. MILEAGE:

ANALYSIS: 20 kmpl is decent enough for 53% of the respondents to

agreed upon that TATA MAGIC has good mileage considering the fact that it

is four wheeler and has more carrying capacity.

4%

36%

53%

7%

MILEAGE

SOMEWHAT DISAGREE

SOMEWHAT AGREE

AGREE

STRONGLY AGREE

50

12. BRAKES:

ANALYSIS: Disc Brakes at front wheel and Drum Brakes (200mm dia×30mm) at rear wheel has lead 77% of respondents to agree strongly upon that TATA MAGIC has a better braking system than its competitors.

9%

14%

77%

BRAKES

SOMEWHAT AGREE

AGREE

STRONGLY AGREE

51

DEALER ANALYSIS OF TATA MAGIC IN JHARKHAND

There are 5 authorized dealers of TATA Motors in Jharkhand covering 24 districts. They are:

1. MITHILA MOTORS:

This dealer of TATA Motors operates in 3 districts of Jharkhand

namely East Singhbhum, West Singhbhum and Saraikela &

Kharswan. It is the oldest dealer of TATA Motors in the state of

Jharkhand and has main office at Jamshedpur.

The shaded area in the above map is the region (East Singhbhum,

West Singhbhum and Saraikela & Kharswan) where Mithila Motors

operates.

52

We can see that in the year 2008 market share was increased by

92.79% from 5.27% to 10.16% and in the year 2009 it was

decreased by 4.53 % from 10.16% to 9.70%

5.27%

10.16%9.70%

0.00%

2.00%

4.00%

6.00%

8.00%

10.00%

12.00%

07 08 09

MITHILA MOTORS

MARKET SHARE

53

2. BUDHIA AGENCIES:

This dealers covers the area of 8 districts of Jharkhand namely

Ranchi, Palamu, Khunti, Garwha, Gumla, Simdega, Lohardagga,

Latehar. Covering the maximum number of districts than any other

dealer in the state of Jharkhand. It has main office at Ranchi.

Shaded area in the above map shows the region covers by Budhiya

Motors. it also includes Khunti, a district that is formed recently which

was earlier a part of Ranchi district.

54


215.7% from 3.95% to 12.47% and in the year 2009 it was increased

by 3.84% from 12.47% to 12.95%

3.95%

12.47%12.95%

0.00%

2.00%

4.00%

6.00%

8.00%

10.00%

12.00%

14.00%

07 08 09

BUDHIA AGENCIES

MARKET SHARE

55

SALES ANALYSIS OF BUDHIA AGENCY IN LAST QUARTER (JAN- APRIL)

January

Feburary

District Unit Sold

District Unit Sold

Ranchi 17

Ranchi 20

Garhwa 1

Garhwa 0

Gumla 6

Gumla 5

Khunti 4

Khunti 6

Lohardaga 3

Lohardaga 2

Palamu 2

Palamu 4

Simdega 4

Simdega 4

Latehar 0

Latehar 0

Total 37

Total 41

March

April

District Unit Sold

District Unit Sold

Ranchi 26

Ranchi 8

Garhwa 4

Garhwa 0

Gumla 3

Gumla 3

Khunti 6

Khunti 3

Lohardaga 4

Lohardaga 0

Palamu 1

Palamu 1

Simdega 6

Simdega 1

Latehar 1

Latehar 0

Total 51

Total 16

56

0

10

20

30

40

50

60

Jan Feb Mar Apr

NU

MBE

R O

F TA

TA M

AGIC

SO

LD

MONTH

Sales

57

3. GAJRAJ VAHAN PVT. LTD:

There are 4 districts under this dealer and they are Hazaribagh,

Ramgarh, Koderma and Chatra. Main office at Hazaribagh.

The region shaded in the above map is the area where Gajraj Vahan

Pvt. Ltd operates. It includes a new district called Ramgarh, which was

earlier a part of hazaribagh district.

58


73.5% from 19.05% to 33.05% and in the year 2009 it was decreased

by 37.8% from 33.05% to 20.53%

19.05%

33.05%

20.53%

0.00%

5.00%

10.00%

15.00%

20.00%

25.00%

30.00%

35.00%

07 08 09

GAJRAJ VAHAN Pvt. Ltd.

MARKET SHARE

59

4. J.M.A STORES:

This dealer of TATA Motors operates in three districts of Jharkhand

namely Dhanbad, Bokaro and Giridih. It operates in one of the most

potential area of Jharkhand and has main office at Dhanbad.

The shaded region in the above map shows the area where J.M.A

stores operates. Though it overs 3 district but they are highly

potential.

60


231% from 11.34% to 37.54% and in the year 2009 it was

decreased by 31.9% from 37.54% to 25.56%

11.34%

37.54%

25.56%

0.00%

5.00%

10.00%

15.00%

20.00%

25.00%

30.00%

35.00%

40.00%

07 08 09

J.M.A. STORES

MARKET SHARE

61

5. GANPATI VEHICLES:

This dealer of TATA Motors covers the entire 6 districts in the north

east region of Jharkhand namely Deoghar, Dumka, Godda, Pakur,

Jamtara and Sahibgunj. It has main office at Deoghar.

The above shaded area of the map show the area that is covered by

Ganpati Vehicles. So far this dealer has the best selling record of TATA

MAGIC for the year 2009 and has achieved the maximum market

share ever by TATA MAGIC.

62

We can see that in the year 2008 market share was increased

tremendously from 0.62% to 39.29% and in the year 2009 it was

increased by 34.41% from 39.29% to 52.81%.

0.62%

39.29%

52.81%

0.00%

10.00%

20.00%

30.00%

40.00%

50.00%

60.00%

07 08 09

GANPATI VEHICLES

MARKET SHARE

63

OBSERVATIONS We can see that market share of 3 dealers of Jharkhand namely

Mithila Motors, Gajraj Vahan Pvt. Ltd. and J.M.A. Stores has

increased from the year 2007 to 2008 but has decreased in the year

2009. At the same time in the rest of the two dealers namely Budhia

Agencies and Ganpati Vehicles market share has increased

continuously from the year 2007 to 2009.

There is a tremendous increase in the market share of Ganpati

Vehicles in both the year ( 2007 to 2008 and 2008 to 2009) and the

reason behind this is that it is a tourist place and the main railway

junction is at Jasidih (8 kms. away from the town)

As we can see that in the year 2007 market share of TATA MAGIC is

not good in entire state of Jharkhand and the reason behind this is,

the vehicle was launched in the year 2007.

64

A comparison between operating economics of TATA Magic and Three wheeler

We were sent on a live project on five different routes, we had conducted survey on these routes. Our job was as follows

To locate the route from which the vehicle is travelling and note down the main halts.

Check the exact distance in kilometers Amount of time which is been taken to reach the destination Total fair been collected Number of average passengers who were travelling

Mean while we also had to communicate with the driver and find out

life of the tyre Price of each Tyre In how may kilometers it gets changed What other purposes is the vehicle been used i.e. in marriages etc Highest number of passengers the vehicle has ever accommodated Average income per day Owner’s cut

To make our survey more easy we travelled the route once with TATA Magic and once with three wheeler.

65

KUTCHARY to DHURVA

Earnings Actual Magic Minidoor Expected Magic Minidoor Legal Seating Capacity 7 6 Legal Seating Capacity 7 6 Actual No of Passengers 10 9 Actual No of Passengers 14 11 One side Distance 16 16 One side Distance 16 16 No of return trips per day 4 4 No of return trips per day 4 4 Total Distance per day 128 128 Total Distance per day 128 128 Fare one side/person 10 10 Fare one side/person 10 10 Total Earnings per day 800 720

Total Earnings per day 1120 880

Fixed Cost Price 293000 215000 Price 293000 215000 Registration 4500 4000 Registration 4500 4000 Insurance 11000 8500 Insurance 11000 8500 On-Road Price 308500 227500 On-Road Price 308500 227500 Funding (70%) 215950 159250 Funding (70%) 215950 159250 Rate of Interest (Flat) 11.00% 11.00% Rate of Interest (Flat) 11.00% 11.00%

Tenure of Loan 4 4

Tenure of Loan 4 4 EMI 6479 4778 EMI 6479 4778

Fixed Cost per day 216 159


Variable Cost

Fuel Mileage 14 18 Fuel Mileage 14 18 Fuel Price 38 38 Fuel Price 38 38 Fuel Cost/ km 2.71 2.11 Fuel Cost/ km 2.71 2.11 Tyre Life 70000 60000 Tyre Life 70000 60000 Cost of one Tyre 2000 2000 Cost of one Tyre 2000 2000 No. of Tyres 4 3 No. of Tyres 4 3 Tyre Cost per km 0.11 0.10 Tyre Cost per km 0.11 0.10 Maintenance/ km 0.25 0.40

Maintenance/ km 0.25 0.40

Variable cost per day 394 334


Total Cost per day 614 493 Total Cost per day 610 493 Profit per day 186 227 Profit per day 510 387

Profit per month 5580 6796 Profit per month 15300 11596

66

Kutchary to Dhurva

Distance - 16Km

Duration – 60 minutes

Fair - Rs. 10

TATA Magic Minidor Mileage 14 18 Average Passenger 8 9 Number of trips 5 5

Kutchary Lalpur Kantatoli Station More Overbridge Ag more Birsa Chowk golchakkar

Jail More dangra toil Bahu Bazar Sujata Post Office Hinoo Chowk Vidhan Sbha Dhurva

REMARKS

Three wheeler customer feedback about Magic

1. Being a TATA product it might work 2. Comparatively not as good as Minidor, the earning is more in Minidor 3. Mileage of Magic is the key problem

Are the 3-W earning there: YES

Would Magic be viable vehicle for them:

Yes, Magic will be a viable vehicle for them in this route; it still has a capacity to fill 3 more passenger, which would increase their profit by more than 50%, whereas Minidor can occupy just one more passenger.

Any prospect: NO

Income per day as per the driver/owner (excluding fuel)

Magic- 600

Minidor-500

67

KUTCHARY to RAMPUR

Earnings Actual Magic Minidor Expected Magic Minidor

Legal Seating Capacity 7 6 Legal Seating Capacity 7 6

Actual No of Passengers 8 7 Actual No of Passengers 14 11 One side Distance 16 16 One side Distance 16 16 No of return trips per day 4 4 No of return trips per day 4 4

Total Distance per day 128 128 Total Distance per day 128 128

Fare one side/person 15 15 Fare one side/person 15 15

Total Earnings per day 960 840 Total Earnings per day 1680 1320

Fixed Cost

Price 293000 215000 Price 293000 215000 Registration 4500 4000 Registration 4500 4000 Insurance 11000 8500 Insurance 11000 8500 On-Road Price 308500 227500 On-Road Price 308500 227500 Funding (70%) 215950 159250 Funding (70%) 215950 159250 Rate of Interest (Flat) 11.00% 11.00% Rate of Interest (Flat) 11.00% 11.00%

Tenure of Loan 4 4

Tenure of Loan 4 4

EMI 6479 4778 EMI 6479 4778



Variable Cost





Total Cost per day 571 492 Total Cost per day 567 492

Profit per day 389 348 Profit per day 1113 828


68

Distance - 16Km


Fair - Rs. 15

TATA Magic Minidor Mileage 14 18 Average Passenger 8 7

Number of trips 6 4

Kutchary Lalpur Kantatoli Lawdih Chowk P.Office Acadmic council Sidrol Rampur

Jail More Dandatoli Shamlang Crossing Sadabahar Bargoma ITI

3-W customer's Feedback about Magic:

1. Its earning good because in highways you can observe there are too many TATA Magic running

2. Existence of Magic has not hampered our business. 3. Its good to see healthy competition



YES, as per the data we can see that Magic is earning higher than Minidor and has the abilty to earn more in it's full capacity. This route is also preferable because there are huge number Male and Female labours coming from villages in this route to work in city every day. And the base reality is 30 of them travel in one particular vehicle and they pay Rs.5 each which would make a total of Rs.150 at one go and the same people come back too therefore the conclusion derived is, in one particular trip Magic is earning Rs.300.

Any prospect: NO

Income per day as per the driver/owner (excluding fuel) Magic – 700

Minidor - 500

69

KUTCHARY to NAMKOM

Earnings Actual Magic Minidoor Expected Magic Minidoor


Actual No of Passengers 10 9 Actual No of Passengers 14 11 One side Distance 13 13 One side Distance 13 13 No of return trips per day 5 5 No of return trips per day 5 5 Total Distance per day 130 130 Total Distance per day 130 130

Fare one side/person 10 10 Fare one side/person 10 10 Total Earnings per day 1000 900

Total Earnings per day 1400 1100

Fixed Cost


Tenure of Loan 4 4

Tenure of Loan 4 4

EMI 6479 4778 EMI 6479 4778



Variable Cost








70

Distance - 13Km


Fair - Rs. 10


Kutchary Lalpur Kantatoli Lawdih Chowk P.Office Namkom Bazar

Jail More Dandatoli Shamlang Crossing Sadabahar


1. If Magic and minidor both are on stand people prefer to occupy seat in Minidor than Magic reason not specified

2. Magic is also doing equally good business 3. Leg space is more in Minidor than Magic

Are the 3-W earning there: YSE


Yes Magic is a viable vehicle for them as we can see that the difference in profit is not much and which can easily be achieved. If they just move 3 Km ahead from Namkom to Rampur they can get many passengers as there are limited number of commercial vehicles running in this route and there are people who come to city every day for various reasons. And fair charged till Rampur is also higher in compare to Dhurva and Hatia they charge Rs.10 for 16 and 20 Km respectively whereas Rampur is also 16Km but the fair is Rs.15

Any prospect: NO


Magic -700

Minidor - 500

71

KUTCHARY to HATIA

Earnings Actual Magic Minidor Expected Magic Minidor


Actual No of Passengers 11 10 Actual No of Passengers 14 11 One side Distance 20 20 One side Distance 20 20 No of return trips per day 4 4 No of return trips per day 4 4 Total Distance per day 160 160 Total Distance per day 160 160



Fixed Cost


Tenure of Loan 4 4

Tenure of Loan 4 4

EMI 6479 4778 EMI 6479 4778



Variable Cost








72

Kutchary to Hatia

Distance - 20Km


Fair - Rs. 10


Kutchary Lalpur Kantatoli Station More Overbridge Ag more Birsa Chowk Hatia Bazaar

Jail More dangda toil Bahu Bazar Sujata Post Office Hinoo Chowk Hatia Station


1. This route has potential market for magic 2. No threat from magic. 3. People travelling short distance does not prefer magic



No, In this particular route Magic is not preferable because the distance is 20km and the fair is just Rs.10. Taking mileage into consideration the profit is getting hampered.

Any prospect: NO


Magic - 500

Minidor - 600

73

ITI to BHARNO

Earnings Actual Magic Piaggio Expected Magic Piaggio


Actual No of Passengers 8 5 Actual No of Passengers 12 8 One side Distance 40 40 One side Distance 40 40 No of return trips per day 2 2 No of return trips per day 2 2

Total Distance per day 160 160 Total Distance per day 160 160



Fixed Cost

Price 293000 156000 Price 293000 156000

Registration 4500 4000 Registration 4500 4000 Insurance 11000 8500 Insurance 11000 8500 On-Road Price 308500 168500 On-Road Price 308500 168500 Funding (70%) 215950 117950 Funding (70%) 215950 117950 Rate of Interest (Flat) 11.00% 11.00% Rate of Interest (Flat) 11.00% 11.00%

Tenure of Loan 4 4

Tenure of Loan 4 4

EMI 6479 3539 EMI 6479 3539



Variable Cost








74

Distance - 40Km

Duration – 2hrs

Fair - Rs. 30

TATA Magic Piaggio Mileage 15 27 Average Passenger 8 5 Number of trips 2 2

ITI More Itki More Garhgaon Bharno

Nagri Kurgi Bedo

Remarks 3-W customer's Feedback about Magic: 1. Village people by seeing the look of Magic thinks that Magic would charge high rate for the same route. 2. Magic is performing well because it has good speed so it covers the distance much quicker. 3. It can accommodate more passengers at a time so two trips per day is also sufficient for Magic


Would Magic be viable vehicle for them: Yes, Magic in this route is perfectly suitable as it is travelling a longer distance on a traffic free route therefore the vehicle is also giving good mileage. And the fair being charged is pretty good. If it runs in it's full capacity in this route the vehicle owners can make a huge profit. Any prospect: NO

Income per day as per the driver/owner (excluding fuel) Magic - 450 Piaggio -550

75

FINDINGS

As I worked on this project, I came across many things. This was really good

learning for me. My findings while working on this project are:

CHALLENGES FACED

1. LOW PICK UP: Low-pick up was the major problem that was faced by the customers. Customers expected that being a vehicle of TATA Motors and four wheeler vehicle it should have more pick up

2. GEAR BOX : Gear shifting was also one of the problems faced by the customers. The complaint was that when gear shifts from 2nd to 3rd it creates some problem. Few said that the height of the gear box is bit high if it would have been in the level of the seat they could accommodate one person in the front.

3. COLOUR : There were very few customers came up with colour problem. They said that, as auto or other six- seaters are in market since a long time and are of yellow and brown/ black colour this has created an image that commercial passenger vehicle is only of yellow and brown/black colour. Thus people generally do not approach TATA Magic (red and white colour) in the areas where the product is not familiar. Passenger thinks that it is a private vehicle.

4. MILEAGE : Average mileage of the vehicle is coming between 14-16 because of which many consumers are not satisfied.

5. AVERAGE EARNING: In short routes the competitor of Magic earns more but in long routes Magic’s average earning is more and hence Magic is more viable in long routes .

76

ADVANTAGES

1. Beneficial in long routes: In our survey we can analyze that Magic running in long distance is in much profit when compared to other vehicles.

2. Tyre: Tyre life, of Magic is more than the other vehicle which certainly decreases the variable cost in long run.

3. Drivers comfort: Driver has his separate independent seat which increases his driving comfort. One of the respondents said that “ I have my own seat so I don’t face any problem in driving if the number of passengers are more than 20 also (which sometimes happen) they adjust themselves anyhow and my responsibility is to drop them safe”

4. Shower proof: On rainy season customers will prefer Magic over Minidor as it has gone through the shower proof test successfully, so chances of customers getting wet or even spoiling their clothes is minimal.

5. Noise free: Compare to other three wheeler Tata Magic advance engine make less noise and make travelling more comfortable, unlike other three wheeler Tata magic does not have engine at back and therefore makes less noise and does not irritate the passengers.

6. Comfortable seats: Tata Magic wide seats provide good seating comfort to the passengers , the leg space in Tata Magic is more compared to other three wheelers .This is very necessary for long distance routes . The cushion of the seats is better than other three wheelers and therefore provides better seating comfort to the passenger.

77

STRATEGIC RECOMMENDATIONS:

As per our survey in various auto stands in Ranchi & nearby areas and the

responses been collected from different auto drivers and the owners. We

found out that TATA Magic’s target customers are both the owner as well as

the passengers. They both have different mind sets regarding Magic. The

buyers of TATA Magic has purchased the vehicle looking at it looks, safety

features and overall comfort of the passengers and due to these features

company charges higher price. But the real challenge is that the passenger

does not value these features in the city routes because they travel a very

short distance and these features hardly matter to them.We would like to

give the following suggestions to my project guide regarding the viability of

TATA MAGIC in different routes at Ranchi:

TECHNICAL ISSUES:

Improve pickup

Height of gear box should be in the level of the seat

Improve mileage

MARKETING STRATEGIES

Create new segment like educational institute and small nursing

homes

Should provide live demos in the potential routes, by providing

Magic and fuel and letting them keep the earning of that trip.

Making customers aware about the operating economic in the

potential routes

Offer Magic in more colours like yellow and green

Exchange facility should be provided

FINANCIAL ISSUES

Decrease the percentage of down payment from 30% to 25% Reduce Equated Monthly Installments.

78

CONCLUSION

After going through the training period and conducting rigorous survey

from various consumers of TATA Magic and its competitor we came to

know the various factors responsible for the success and failure of

TATA MAGIC and their competitors. We also came to know the various

perception of TATA Magic from the customer and the customer of the

competitor brand in this particular segment.

Being the student of marketing the entire training taught me the

various practical aspects to be taken into account for increasing the

sales of commercial vehicles and the factors which must be improved

to make TATA Magic viable in various routes in Ranchi. The project

gave us an insight into sales market of the vehicles of TATA Magic,

what strategies are adopted by them and their competitors. An

overview of the corporate life was presented to us.

We not only learnt the real situation of the automobile sector but also

gained practical knowledge and experience.

79

LIMITATIONS

The Project is focused to Jharkhand State only

.

The data obtained from RTO incorporated only for 10 and half

months for the year 2009.

The duration of the Project is 14 weeks so scope of in-depth

evaluation Results is limited.

Auto drivers/owners surveyed may tend to get bias towards

their perception and may project a false picture which may

affect the reliability and validity of the study.

The sampling technique used in different auto stand in Ranchi

to collect the primary data might be wrong, as Respondents

appeared limited.

Discrepancy in data provided by the RTO like some blank data.

80

ANNEXURES

ANNEXURE 1:-

Stand Survey

1. Stand Location-______________________

2. Name- ____________________________________________

3-Address- _______________________________________________

_______________________________________________

4. Contact No. - ____________________________

5. Model/Make-__________________________

6. Vehicle No.-___________________

7. Actual passenger capacity- (a) 6 (b)8 (c)10 (d)12 (e)14 (f)above 14

8. Route-____________________________

9. One way distance (Km)-____________

10. No. of trips- (a)1 (b)2 (c)3 (d)4 (e)5 (f)above 5

9. Mileage-(a) 10-15 (b)15-20 (c)20-25 (d)25-30

10. Financed- Yes No Installment-__________________

11. Respondent- Owner Driver

12. Average Daily income- (a) below 200 (b) 200-400 (c) 400-600 (d) 600-800

(e) Above 800

13. Owners Cut-_________

14.Tyre life-______________Km

15. Feedback-___________________________________________________________________

81

ANNEXURE 2:-

1. Design of TATA Magic is good than its competitors. A. Strongly disagree B.Somewhat disagree C.Disagree

D.Somewhat agree E.Agree F.strongly agree

2. Seating capacity of TATA Magic is better than its competitors.

A. Strongly agree b. B. Somewhat disagree

3. Pickup of TATA Magic is better than its competitors.

A. Strongly disagree B.Somewhat disagree C.Disagree

d.Somewhat agree

4 Speed of TATA Magic is better than its competitors.

A.Agree B.Strongly Agree

5. Comfort ability of TATA Magic is better than its competitors.

A. Can’t say B.Somewhat agree C.Agree

D.Strongly agree

6.Durability of TATA Magic is More than its competitiors.


D.Strongly agree

7.Profitability of TATA Magic is more than its competitors


D.Strongly agree

8. Safety of TATA Magic is better than its competitors.

A.Somewhat agree B.Agree C.strongly agree

82

9.Increase in social status is more in TATA Magic than competitors.

A.Somewhat agree B.Agree C.Strongly agree

10.Service at service station is better than its competitior.

A. can’t say B.Somewhat disagree c.Agree

D.Somewhat disagree

11.Mielage of TATA Magic is more than its competitors.

A. Somewhat disagree B.Somewhat agree C.Agree

D. Strongly Agree

12 Brakes of TATA Magic are better than its competitors.

A.Somewhat agree B. Agree C. Strongly agree

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COMPARATIVE EXPERIENCE ON A PERCEPTUAL BASIS WITH MARKET LEADER

Features Strongly Disagree

Disagree Somewhat Disagree

Can’t Say

Somewhat Agree

Agree Strongly Agree

1.Design 1 2 3 4 5 6 7

2.Seating Capacity

1 2 3 4 5 6 7

3.Pick up

1 2 3 4 5 6 7 4.Speed

1 2 3 4 5 6 7 5.Comfortability Driver

1 2 3 4 5 6 7

5.Comfortability Passenger

1 2 3 4 5 6 7

6.Durability 1 2 3 4 5 6 7 7.Tyres

1 2 3 4 5 6 7 8.Safety

1 2 3 4 5 6 7 9.Increase in Social Status

1 2 3 4 5 6 7

10.Service Station

1 2 3 4 5 6 7

84

REFERENCES

BOOKS: Principles of marketing by Philips Kotler.

Research Methodology by C. Kothari

MAGAZINES & News-papers & Pamphlets:

Business Standards.

The Economic Times.

Business world.

Company pamphlets.

WEB SITES: magic-tatamotors.com.

www.siam.com

carblogindia.com.

autosmaxabout.com.

auto.indiamart.com.

Tata Magic vs Three Wheelers

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