MARKETING MANAGEMENT

SLEPT ANALYSIS OF
MARUTI

SUBMITTED TO PROF. PALLAVI LALL

AKSHIT MAMANIA
DIV: D
 A SLEPT analysis is an analysis of the external macro-environment that
affects all firms. S.L.E.P.T. is an acronym for the Social, Legal Economic,
Political, and Technological factors of the external macro-environment. Let us
look at the SLEPT analysis of the Maruti Suzuki.

Maruti Suzuki India Limited a subsidiary of Suzuki Motor

Corporation of Japan, is India's largest passenger car company, accounting
for over 45% of the domestic car market. The company offers a complete
range of cars from entry level Maruti-800 and Alto, to stylish hatchback Ritz,
A star, Swift, Wagon-R, Estillo and sedans DZire, SX4 and Sports Utility
vehicle Grand Vitara.

SLEPT ANALYSIS OF THE MARUTI SUZUKI.

Social Factors
Rapid urbanization of semi urban region. As life gets more complex with
more urbanization need for car have increased. It is no more considered a
luxury in some cases. Thus there is no doubt that the car market is booming
and maruti need to focus on the needs and demand of the sector.

Changing demographic distribution are conducive for growth. India has

highest portion of population below 35 years, 70%, (potential buyers), which
means that 130 million people will get added to the working population. The
trend indicates that small and medium cars would remain dominant and a
shift towards high end cars is expected at a faster rate. The SUV market is
expected to develop rapidly in future

In a country like India, there are people from varied income groups. The
companies have to recognize these individuals and should serve them
accordingly.

Factors like changing lifestyle in urban india, rising aspiration levels,

improvements in living standards of middle class, increased spending on
fashion and lifestyle comforts will lead to more demand for passenger cars in
future.
Legal Factors
Duties and taxes: Various duties and taxes like excise, customs, VAT, etc
impact the automobile industry.

In India the Rules and Regulations related to driving license, registration of

motor vehicles, control of traffic, construction & maintenance of motor
vehicles etc are governed by the Motor Vehicles Act 1988 (MVA) and the
Central Motor Vehicles rules 1989 (CMVR)

Emission norms(Environment regulation): Emission norms are the levels

or limit of pollutants permitted for emission by a vehicle. These norms are
prescribed under Rule 115 of the Central Motor Vehicle Rules 1989 with a
vision to control environment pollution. All the auto manufacturers have to
implement these norms before manufacturing any car or vehicle.

History of Emission Norms in India: It was only in 1991 that the first stage
emission norms came into force for petrol vehicles and in 1992 for diesel
vehicles.. In the year 2000 passenger cars and commercial vehicles will be
meeting Euro I equivalent India 2000 norms. Euro II equivalent Bharat Stage
II norms were in force from 2001 in 4 metros of Delhi, Mumbai, Chennai and
Kolkata. Later in 2005, the third stage of emission norms came into force.
These norms are still implemented today in all the cities of the country. Soon
Bharat Stage IV is to be implemented in the country for all vehicles across
India.

Meeting Indian vehicle safety and other performance standards also requires
substantial attention to various elements of the car, such as brakes, lights,
interior fittings, active and passive safety, emission control, and structural
reliability. Ensuring that these standards are met may often require
modification of the vehicle itself or of the components. While many of these
design and engineering changes may be minor, in the aggregate they have
significant influence on numerous technological aspects of the vehicle
Economic Factors
There is potential for much higher growth in the domestic market due to fact
that the current penetration level in india is just 7 cars per thousand persons.

Rising per capita income: The per capita income is on increase and this
will lead to more demand for passenger cars in future. For this cars for
various segment needs to be launched.

Increased access to credit and lower interest loans translating to low

financing and acquisition cost hence greater affordability. 85% of cars are
financed in India.

Increasing disposable income in rural sector: With urban markets set to

become stagnant in near future Maruti in a proactive approach should try to
capture the rural market by introducing their low cost model in this sector.

Cost efficiencies contributing to lower production costs: Average

wages in India are almost less than 50 % of wages in developed countries.
Due to the huge savings in the labour cost sourcing auto components and
finished cars makes a lot of business sense to the auto manufacturers who
have global presence.

Availability of qualified human resources:

 The improved design capabilities and continuous improvement in quality
has been possible only because of the availability of skilled manpower like
engineers and IT professionals.

Political Factors
Economic liberalization , started in 1991, led to delicensing of the
passenger car segment in 1993. Before liberalization maruti Suzuki was
highly protected by the government of india, but after competitors started
coming in, it did loose considerable amount of share in the market. Thus
auto policy was a major factor for maruti in the time of liberalisation

Automotive Mission Plan 2006-2016: In order to improve the automobile

industry in India, to provide world class facilities of automotive testing and
certification and ensure a healthy competition among the manufacturers at a
level playing field, our ministry has undertaken to lay down the road map for
future development of the industry in the form of “Automotive Mission
Plan 2006-2016”. Through this automotive mission plan government also
wants to lay a predictable direction of growth to enable the manufacturers to
take more informed investment decisions.

Technological Factors
Need for innovation: The competitiveness in the sector will largely depend
on capacity ot the industries to innovate and upgrade. The last decade has
seen a major transformation of the Indian car industry, from a protected
business with only one world-class manufacturer to a landscape that includes
most of the world’s major players as well as some emerging domestic firms
vying for a significant piece of an expanding market. In the process, the
industry has also leaped forward technologically, driven by a confluence of
factors such as intense competition, demanding consumer preferences,
government policies (especially tightening emission standards), and the
global strategies of the various players. Now, cars manufactured in India are
based on designs, and incorporate technologies, that are often comparable
with those available globally. The capability to manage technological change
will be important to meet the challenges of an increasingly globalized
automobile market, as well as local and global environmental challenges.