Chervolet Part a n b

7/29/2019 Chervolet Part a n b

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Part A

Organisation study


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Chapter 1

Industry Profile


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Chapter 1

Industry Profile

Peter Drucker refers to automobile industry as the Industry of Industries Itcreates employments for thousands and gives birth to many entrepreneurs. It

satisfies one of the most basic needs of a human being mobility.

It is a well known fact that Automobile industry is the cornerstone of some of the

most influential economies in the world like USA and Japan. Indian Automobile

industry is all set to play the same role in Indian Economy. Indian Automobile

market today is one of the most modern, growing and vibrant automobile

markets on the global map. India is second biggest two-wheeler market in the

world. The four-wheeler market in India is also one of the fastest growing and

most promising. No wonder, it has become a centre of attraction for most of the

global automobile players.

Automobile industry in India

India is the 2nd largest two wheeler manufacturer in the world

Second largest tractor manufacturer in the world

5th largest commercial manufacturer in the world

3rd largest car market in Asia, surpassing China in the process

Automobile Industry in India is still in its infancy but growing rapidly. The

opportunities in the automobile industry in India are attracting big names with

the big purse and they are investing vigorously in infrastructure, design and

development, and marketing. Automobile industry in India is today poised for the

big leap.

Current and Future Trends In Advertising in Indian Automobile Sector

Automobile industry Contributes 17% of the total indirect taxes collected by the

exchequer & is a driver of product and process technologies, and has become a


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excellent manufacturing base for global players, because of its High machine tool

capabilities, extremely capable component industry.

With respect to the above, the researcher aims to study the current trends in

advertising in Indian automobile sector and eventually to suggest ways and meansof improving the effectiveness of advertising so that the automobile sector meets

with the increasing demand and enhanced customer expectations in the Indian

scenario.


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Chapter 2

Company Profile


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Chapter 2

Company Profile

2. a Background and Inception of the Company:

General Motors was founded in 1908 in Flint, Michigan by William C. Durant. The

company has its global headquarters in Detroit and employs approximately

209,000 people all over the world. It does business in 120 countries and, together

with its strategic partners, produces cars and trucks in 31 countries. GMs highest

sales are reported from China, followed by the United States, Brazil, the United

Kingdom, Germany, Canada, and Russia.

The company includes a total of 13 brands - Baojun, Buick, Cadillac, Chevrolet,FAW, GMC, Daewoo, Holden, Isuzu, Jiefang, Opel, Vauxhall, and Wuling under

its umbrella.

Over the past few years, GM has suffered several setbacks, including the

declaration of bankruptcy in June 2009 and an eventual split. A New GM

emerged in 2009 with the support of the US government. The new company was

listed on the New York Stock Exchange in November 2010. As part of the

reorganization, the company phased out two of its brands - Pontiac andGoodwrench - and adopted a new brand identity. It also received loans from

European governments in 2009, and reduced its stake in European operations.

Operations in other parts of the world were not affected by the bankruptcy and

continued as before.

2. b Nature of the Business carried:

Automotive:

The company offers a global vehicle portfolio of cars, crossovers and trucks. They

are committed to leadership in vehicle design, quality,reliability, telematics and

infotainment and safety, as well as to developing key energy efficiency, energy

diversity and advanced propulsion technologies, including electric vehicles with

range extending capabilities such as the Chevrolet Volt. Business is diversified


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across products and geographic markets. They meet the local sales and service

needs of our retail and fleet customers with a global network of independent

dealers. Of total 2011 vehicle sales volume, 72.3% was generated outside the

U.S., including 43.4% from emerging markets, such as Brazil, Russia, India and

China (collectively BRIC), which have recently experienced the industrys highest

volume growth.

The companys automotive business is organized into four geographically-based

segments:

GMNA, with sales, manufacturing and distribution operations in the U.S.,

Canada and Mexico and sales and distribution operations in Central America and

the Caribbean, represented 32.4% of our vehicle sales volume in 2011 and the

largest market share in this market at 18.4%.

GME has sales, manufacturing and distribution operations across Western and

Central Europe. GMEs vehicle sales volume, which in addition to Western and

Central Europe, includes Eastern Europe (including Russia and the other members

of the Commonwealth of Independent States among others) represented 19.2%

of their vehicle sales volume in 2011

GMIO has sales, manufacturing and distribution operations in Asia-Pacific,Eastern Europe (including Russia and the other members of the Commonwealth

of Independent States among others), Africa and the Middle East. GMIOs vehicle

sales volume, which includes Asia-Pacific, Africa and the Middle East is their

largest segment by vehicle sales volume.

GMSA, with sales, manufacturing and distribution operations in Brazil,

Argentina, Colombia, Ecuador and Venezuela as wellas sales and distribution

operations in Bolivia, Chile, Paraguay, Peru and Uruguay represented 11.8% of our

vehicle salesvolume in 2011. In 2011 we had the largest market share for this

market at 18.8% and the number three market share in Brazil.

Automotive Financing GM Financial


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GM Financial specializes in purchasing retail automobile installment sales

contracts originated by GM and non-GM franchised and select independent

dealers in connection with the sale of used and new automobiles. GM Financial

also offers lease products through GM dealerships in connection with the sale of

used and new automobiles that target customers with sub-prime and prime credit

bureau scores. GM Financial primarily generates revenue and cash flows through

the purchase, retention, subsequent securitization and servicing of finance

receivables. To fund the acquisition of receivables prior to securitization, GM

Financial uses available cash and borrowings under its credit facilities. GM

Financial earns finance charge income on finance receivables and pays interest

expense on borrowings under its credit facilities. GM Financial periodically

transfers receivables to securitization trusts that issue asset-backed securities to

investors. The securitization trusts are special purpose entities (SPEs) that are also

variable interest entities that meet the requirements to be consolidated in the

financial statements.

2. c Vision

Vision is to design, build and sell the worlds best vehicles. The primary elements

of their strategy to achieve this vision are to:

Deliver a product portfolio of the worlds best vehicles, allowing us to maximize

sales under any market conditions.

Sell our vehicles globally by targeting developed markets, which are projected

to have increases in vehicle demand as the global economy recovers, and further

strengthening our position in high growth emerging markets;

Improve revenue realization and maintain a competitive cost structure to allow

us to remain profitable at lower industry volumes and across the lifecycle of our

product portfolio; and

Maintain a strong balance sheet by reducing financial leverage given the high

operating leverage of our business model.


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Quality Policy:

GM Records aims to maintain the companys position as a leading manufacturer.

Its competitive advantage stems from use of the most up-to-date technological

solutions and the expertise of its employees. Customer satisfaction is theoverriding value to which all of the companys activity is aimed.

2. d Product profile:

Chevrolet is one of India's leading automobile manufacturers and the market

leader in the car segment, both in terms of volume of vehicles sold and revenue

earned.

BEAT:

The Chevrolet Beat combines expressive

exterior design, a well-equipped interior

and many smart features.

Compact on the outside, the Beat has a

spacious cabin that seats up to 5 adults.

With its high build-quality and clever design

details, the Beat is amongst the safest,

most comfortable and practical cars in its

class.

CRUZE

The bevelled hood of this mean machine

hosts the most powerful and refined engine

in its class. An all new, powerful 2.0 litre

VCDi engine unleashes 166 PS of undulated

power on the tarmac. Add to this beautiful

styling both inside and out, superb driving

characteristics and a perfect blend between

fuel efficiency and performance, and you

have the most desirable sedan in India

the Chevrolet Cruze.


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SPARK :

The Chevrolet Spark combines expressive

exterior design, a well-equipped interior

and many smart features.

Compact on the outside, the Spark has a

spacious cabin that seats up to 5 adults.

With its high build-quality and clever design

details, the Spark is among the safest, most

comfortable and practical car in its class.

CAPTIVA :

The Chevrolet Captiva is a purposeful SUV

with the looks you desire, the power youdeserve and the versatility you demand.

Soft from the inside and tough on the

outside, the Captivas aggressive and

chiselled frame is accompanied by a

luxurious fully-loaded interior, making it a

suave all-rounder.

TAVERA :

The all-new Chevrolet Tavera Neo 3 is ashowstopper and the road is its ramp.

Engineered to gobble up the road and

competition with equal elan and

sophistication, this powerful MUV is one

smooth operator. Hardly surprising then,

that the roads will feel like butter. Staying

true to Chevrolets design mantra of

strength and style, the car has a sleek,

suave metal exterior that will turn heads,

win hearts and pump up your adrenaline.


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2. e Area of Operation :

General Motors India has its headquarters in Gurgaon, Haryana, and has two

assembly plants (in Talagaon, Maharashtra and Halol, Gujarat) with a combined

production capacity of 385,000 vehicles per year.

It also has a technical centre in Bangalore which focuses on research and

development, vehicle engineering activities, purchasing and financial support

services, and vehicle engine and transmission design.

2. f Ownership Pattern:

In 1994, General Motors India Private Limited (GMIPL) was formed as a 50-50

joint venture between GM and Hindustan Motors. GMIPL started out producing

and selling Opel vehicles, and was bought over completely by GM in 1999. Till2003, the company continued to produce Opel cars at its Halol facility. Later, it

switched to producing Chevrolet vehicles at the same plant.

Joint Venture with SAIC

In December 2009, Chinese auto company Shanghai Automotive Industry

Corporation (SAIC) bought a 50 percent stake in GM India. The new joint venture

company is called General Motors SAIC Investment Limited (GMSIL) and is the 5th

largest automobile manufacturing company in the country after Maruti Suzuki,Hyundai, Tata Motors and Mahindra.

2. g Competitor Information:


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Chrysler Group LLC (privately held), Ford Motor Co & Toyota Motor Corporation are the major direct

competitors of General Motors. And other competitors like Volkswagen, Nissan Motor, Honda Motors,

Fiat, Renault and so on.

General Motors Chrysler Ford Toyota Industry

Market Cap: 44.68B N/A 49.98B 335.46B 20.16BEmployees: 213,000 55,6871 171,000 325,905 58.62k

Qtrly Rev Growth (yoy): 0.02 N/A N/A 0.09 0.13

Revenue (ttm): 150.94B 54.98B1 7.97B 278.66B 47.59B

Gross Margin (ttm): 0.13 N/A 1.00 0.12 0.19

EBITDA (ttm): 12.50B N/A 13.90B 21.58B 5.65B

Operating Margin (ttm): 0.05 N/A 1.00 0.03 0.05

Net Income (ttm): 4.44B 183.00M1 5.66B 9.77B N/A

EPS (ttm): 2.66 N/A 1.42 3.09 2.79

P/E (ttm): 10.71 N/A 9.21 34.33 14.04

2. h Infrastructural Facilities:

About 90% of GMs plants encompassing 220 million square feet of floor space

are running on new PFCN networks. PFCN is a tremendous engineering

accomplishment for GM. Standardizing plant networks has reduced costs,

improved uptime and provided a flexible platform for future applications such as

collaborative engineering.

2. I Achievements and Awards:

1962: GMs market share of the US market was 51%.

1965: GM earned 2 billion dollars in the year

1968: A fifty story GM building opened in New York.

1971: Unleaded gasoline became the main fuel of all GM cars.

1974: GM introduced air bags for cars.

1975: GM started fitting catalytic converters in cars.

1979: GM started manufacturing cars in Spain and Austria.

1982: GM bought a 10% share of Suzuki Motor Corporation
http://in.finance.yahoo.com/q/in?s=GMhttp://in.finance.yahoo.com/q/in?s=GM


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1985: The Chevrolet Nova was manufactured in Fremont in California by GM and

Toyota.

1987: Cadillac and Pininfarina started manufacturing the Allante two-seater

convertible.

1989: GM bought a 50% share in Saab.

1990: Robert Stempel replaced Roger Smith as the Chairman and CEO. Third and

fourth quarter losses for GM were 3.7 billion dollars.

1991: GMs sales fell low and its stock price dropped to 27 dollars while its US

market share was 35%.

1992: John Smale, a P&G employee replaced Stempel as the Chairman of GM. GM

lost 23.5 billion dollars

1995: Agreeing to corporate on car and powertain manufacturing, GM and

Shanghai Automotive Industry joined hands.

1996: GMs headquarters shifted to a center on the Detroit River.

1998: Rick Wagoner became GMs president and chief operation officer. GMs US

share was below 30 per cent. Chevrolets Geo brand was discarded.

2000: Rick Wagoner became CEO of GM.

2001: Bob Lutz became the vice chairman of GMs global product development.

GM launched a Keep America Rolling sales campaign.

2005: GM had to pay 2 billion dollars to Fiat to cancel its agreement. Chevrolet

started exporting cars to China.

2007: The company was ranked the fifth largest by Fortune Global 500.

2008: GMs share of the US market is 20.6 per cent. It employs 250,000 people.


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General Motorss Spark was awarded the Most Dependable Compact Car and

Best Compact Car in Initial Quality 2010 by JD Power and Associates India

study.

GM was one of the top automakers at the NDTV Profit Car and Bike Indiaawards 2011 as it won the Best Communication and PR Campaign for the Beat

and the Car Manufacturer of the Year Award. These are really prominent

awards in India. GM aims to gain more market share in India, the second largest

automobile market in the world. The best vehicles won awards at the sixth NDTV

Profit Car and Bike Awards which had commenced in 2006. The award criteria

consisted of the following: segment position, environment factor, acceptability,

market value, efficiency, and consumer value and segment position.

General Motors also won the Automobile Manufacturer of the Year 2010

award by the Golden Steering Wheel, the Indian edition of Europes automobile

awards. This award was awarded by CarWale, and recognized General Motors

manufacturing capabilities in India.

GMs Halol plant was felicitated with the Gujarat State Safety Award 2010.

GM India won the third prize for energy conservation at the National Energy

Conservation Award 2010 and was awarded by Sushilkumar Shinde. The award

was received by P Balendran, Vice-President, General Motors India.

GM also won the National Level Quality Circle Awards in Halol, the National

Level Quality Circle Excellence Award, Gujarat Safety Award, Energy Conservation

Award, TNS Automotive Award, and the National Safety Award. In 2007, the

company won the Overdrive Car Maker of the Year Award. It also won the NDTV

Profit Car India Awards 2007 Carmaker of the Year Award.

2. j Future Growth and Prospects

GM plans to increase its US market share by one percentage point. They also

want to implement new marketing techniques. They want to remake their

corporate image as a leader and change focus of their advertising to aspiration.

They plan to address the customers, dealers, salespeople, employees and

retirees.


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GM will invest 32 million dollars in its Spring Hill plant and 33 million dollars in its

Tonawanda Power train plant near Buffalo, New York which will help to create

163 jobs in the United States. The Spring Hill plant will have direct injection of its

four cylinder engineers. The company plans to launch the Malibu in 2012 and sell

it to 100 countries.

This investment is only a small portion of the 2 billion investments in its US

manufacturing plants that will create 4,000 jobs in eight states.

GM will hold open houses in its 54 plants in the United States. Visitors will wear

safety goggles and watch the robots and workers work in the plants. These open

houses will have food and vendor tents


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Chapter 3

McKinsey 7SFramework


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Chapter 3

McKINSEY SEVEN-S MODEL:

The 7-S model is better known as Mc Kinsey 7-S. This is because the two

persons who developed this model, Tom Peters and Robert Waterman, have been

consultants at Mc Kinsey & Co, at that time. They published their 7-S model in

their article Structure Is Not Organisation (1980) and in their books, The Art of

Japanese Management (1981) and In Search of Excellence (1982).

The model starts on the premise that an organization is not just structure,

but consists of seven elements.

STRATEGY

SUPER

ORDINATEGOALS

STYLE

SYSTEMS

STAFF

STRUCTURE

SKILLS


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The Mc Kinsey 7-S model is a widely discussed framework for viewing the inter-

relationship of strategy formulation and implementation.

It helps to focus managers attention on the importance of linking the

chosen strategy to a variety of activities that can affect the implementationof that strategy.

Originally developed as a way of thinking more broadly about the problem

of organizing effectively, the 7-S framework provides a tool for judging the

do ability of strategies.

According to one of its developers, Robert H. Waterman Jr, the framework

suggests that it is not enough to think about strategy implementation as a matter

only of strategy and structure, as has been the traditional view.

The conventional wisdom used to be that if you first get right, the

right organization follows. And when most people in western cultures think about

organization, they think structure. We find in practice, however, that these

notions are too limiting.

To think comprehensively about a new strategy and the problem with

carrying in out, a manager must think of his company as a unique culture and

must think about the ability of the company to get anything really fundamental(i.e., not tactical) accomplished as a matter of moving the whole culture.

STRUCTURE:


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The organizational structure is designed to support business goals, and is flexible

while at the same time ensuring effective control and supervision and consistency

in standards across the business groups.

The structure historically had a Vertical organizational structure. The rigid

hierarchy may have contributed to some of the problems they faced as

globalization increased competition. This created many redundancies in

management, and this reflected in the products. For all intents and purposesthese vans are identical. The higher levels of management decided what was

required for all subordinate levels, and that was a one way street. The CEOs,

CFOs, and top executives made all decisions for middle management down to the

individual dealerships. Executives even decided what customers desired, with no

feedback from customers, dealerships, or operational level managers.


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STAFF:

The success story is incomplete without its expert team of experienced staff. It

takes immense care while appointing its working personnel. Entire team is highly

experienced in the automobile industry and is constantly updated with its trainingsessions. At its Showroom, the sales men are provided with all the details about

the Chevrolet cars so that they can assist clients in making a right choice about

the car.

The team shares a passion for customers and a competitive spirit that drives us to

excellence. Culture -- one which represents diversity, inclusion, mutual respect,

responsibility and understanding -- welcomes fresh perspectives and varied

experiences.

About 202,000 employees work in 158 facilities touching six continents, they

speak more than 50 languages and touch 23 time zones. From designing and

engineering state-of-the-art plants and developing new vehicles and technologies

to creating new marketing programs, our team members are valued for their

unique contributions.

Human Resources Team:

Operation involved with activities like, Recruitment, Induction, Training and

Development, Compensation and Benefits, Employee relations, etc.

Administration too comes as an activity under the team. There are respective

regional HR teams operating in all regions as a one-point contact for any HR issues

in the region.

Finance:

Team is another critical department centralized at controlling finance, handlingpayroll calculation and crediting salaries, maintaining complete books of accounts

and internal auditing.

Marketing:


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Team centralized conceptualizes various activities towards increasing our

visibility through Communications, advertising, promotions, public relations and

other events. They co-ordinate press releases, publications, etc.

Information Technology:

This support service in the company ensures that systems and software

application in the organization are well maintained.

Recruitment process:

The recruitment takes place through two ways, one is through campus

recruitment and the other is through the interviews by call or walk in. There is a

lot of scope for those individuals who are ready to think out of the box, have a

passion for meeting people and developing long-term relationships. Such

individuals will feel contented, as they will make a big difference.

Skills:The company puts a lot of effort to ensure the skill of employees. It implements

various programs to improve the skills of its employees. Analytical skills, research

activities, learning & development, team work, relationship management and

communication skills are the top skills required to succeed here.

To have a well rounded development of employees, its calendar comprises and

includes trainings like negotiation skills, problem solving and decision making

skills.

The company frequently undertakes as a part of CSR initiatives the significant

steps in the areas of road safety, skill development, community development and

employee engagement program.

Style:


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Style refers to the employees shared and common way of thinking and let the

individuals pursue creative and innovative approaches to their work. It consists of

two components.

Organization culture. Management style.

The companys organization culture is based on some dominant values and

beliefs, and norms. It encourages the individuals to do their work in creative and

innovative approaches and even with freeness and in comfort.

The firm has got a visionary participative management style is

instead of compelling it creates way to encourage and it is the basic responsibility

of managers and to bring out the talents in research and to motivate to stay in

organization.

Shared values:

Chevrolet with capability and commitment to appear as a learning organization.

There are three processes that are critical to develop, reinforce and cascade a

positive, transparent, supportive and high performing work culture, systems and

practices across the company.

The company has shared values in five areas like customer obsession to make

sure what the customer gets, fast flexible and first mover in production and

selling of cars, innovation and creativity in introducing new technologies and new

models in rapid pace, networking and partnership with other companies and

openness and exploring is the chance to explore and experiment.

Strategy:

To design, build and sell the worlds best vehicles. This powers the development

of world-class products that are winning in the marketplace, and is helping to

transform its business and fortify its balance sheet.

This business model also creates a self-sustaining cycle of reinvestment that

drives continuous improvement in vehicle design, manufacturing discipline, brand


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strength, competitive pricing and margins. Drive and vision of its business model

to the market every day to yield positive results for our investors, employees and

customers worldwide.

System:

Chevrolet has been driven by bold imagination and focused, disciplined action to

realize the power of those ideas. It is part of DNA to realize technology's potential

for positive change and to share that vision with the world.

Its engineers, designers, and planners live years in the future, imagining a future

where cars carrying loved ones never crash; where empty cars can be sent to pick

up friends; and where cars dont break down, leaving stranded.

The company is looking into the future, to a time when vehicles will no longer

pollute; when they use only fuels made from renewable sources or run on

electricity its building technologies into vehicles so they never get trapped in a

traffic jam, can anticipate and avoid collisions, and that can safely take over the

driving for sleepy, busy or distracted drivers.


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Chapter 4

SWOT Analysis

Chapter 4


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SWOT Analysis

Strengths

1. Large Market Share

Although GM's market share in the US has dropped it is still very much

competitive at 26 percent. They also have an increasing share in the Chinese

market. With the right decisions there is no reason for GM to not become the

automotive leader it once was.

2. Global Experience

As explained above even with GM's recent decline they still have the market

share and the experience to bounce back. They have been a worldwide company

for nearly a century now and have established themselves as the global leader for

most of them. If you recall I mentioned above that a current opportunity for GM

is to expand globally and as we can see they already have the experience to do so.

It is just a matter of the correct planning and proper implementation of those

plans that will decided whether or not GM's goals are achieved.

3. Variety of Brand Names

GM as I mentioned has been the automotive leader for the majority of the last

century. A large reason for that is the wide variety of quality brand names that

appeal to all target markets. The current GM brands include: Chevrolet, GMC,

Cadillac, Buick, Pontiac, Saturn, Hummer, Saab, Daewoo, Opel, and Holden.

4. GMAC Customer Financing Program

Since its establishment in 1919 it has proven to be GM's most reliable source of

revenue.

5. OnStar Satellite Technology


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Developed in 1996 OnStar currently has over 3 million subscribers and is standard

on all GM vehicles. This technology allows the vehicles to be tracked in the event

of an emergency or theft. It also allows the driver and or passengers the ability to

communicate with OnStar personnel at the click of a button.

Weaknesses

1. Behind on Alternative Energy Movement

This is GM's biggest weakness. The alternative energy/hybrid trend has begun to

take place in the automotive industry and GM has been one step behind the

competition in terms of alternative energy vehicles. This has led to many

problems including loss of market share and a decrease in company profit. In

order for any automotive company to be successful from this point forward they

must be Hybrid friendly and fuel efficient.

2. Poor Organizational Structure

As we can see in exhibit 1 of the case GM's organizational structure seems to be

too vertically integrated. This causes a lack of communication between employees

from top to bottom and may have played a part in GM falling behind on the

alternative energy movement.

3. Stagnant Profitability

Looking at GM's profit we see that they are certainly struggling with respect to

the size of their company. Their profit margin was about 1.5% and the ROE has

dramatically decreased over the recent years dropping to 10% in 2004. This is a

situation that shareholders will not be pleased with.

4. Overly Dependent on US market

GM has become too dependent on the US market and must take advantage of the

opportunity to expand globally. The competition is becoming too strong to focus

on just one country.

5. Overly Dependent on GMAC Financing


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GM has become too dependent on its financing program. Granted it is a great

strength for GM, however they once again cannot rely solely on financing in order

to turn profit, especially if they want to compete with Honda and Toyota who are

rapidly growing.

6. Poor Credit Status

GM's credit status has like everything else has been steadily declining. Their

current ratio is just barely above 1 and their acid test is even lower.

Opportunities

1. Alternative Energy Movement

It is obvious that GM was behind its competition with regards to the research and

development of hybrid vehicles. However hybrid technology is still very much new

giving GM the opportunity.

2. Continuing to Expand Globally.

Recently GM saw an increase in the Chinese automotive market, which proves

their needs to be more emphasis put on foreign markets. If GM can infiltrate

these markets and successfully grow along with their continuing focus on the US

market they will be headed in a positive direction.

3. Low Interest Rates

With the right marketing strategy the low interest rates have the potential to

generate an immediate increase in sales.

4. Develop New Vehicle Styles and Models

This is an opportunity that will never be satisfied, meaning that GM should alwaysbe attempting to develop the automotive world's most popular vehicles, and as

we know, what is in today will be out tomorrow.

Threats

1. Rising Fuel Prices


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With GM being a large producer in both trucks and SUV's, sales have drastically

decreased due to the lack of fuel efficiency. The rise in fuel prices has played a

significant role in creating the opportunity for development of both hybrid and

more fuel efficient vehicles. As you will find with most threats, an equal

opportunity will usually emerge as is the case here with GM's opportunity

mentioned above.

2. Growth of Competitors

GM no longer has the luxury of being the known leader in the automotive

industry and faces the reality that they are in serious trouble. As I mentioned

earlier Toyota took the first step in the direction of hybrid technology and has

since drastically growing.

3. Pension Payouts.

Part of this threat is their own doing and the other is simply unavoidable. GM is

responsible for providing generous pension benefits to its employees, which at

the time seemed like a great idea, however they are now experiencing problems

as more and more people begin to collect.

4. Increased Health Care Costs

GM, like many large companies with quality employee health care benefits, is

experiencing a large financial hit that only gets worse as time continues.

5. Rising Supply Costs, i.e. Steel

Once again this threat affects the entire automotive industry and forces each

company to cut manufacturing and production costs as much as possible, without

taking away from the quality of the product


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Chapter 5

Analysis of Financial

Statements


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Chapter 5

Analysis of Financial Statements

Financial Statement Analysis:

The company has been awarded the highest financial credit rating AAA (long

term) and A1 (short term) on its bank facilities by CRISIL.

Net Profit ratio: Rs. In Million

Particulars 2011 2010

Earnings after tax 9287 6503Sales 150276 135592

Net Profit ratio 0.0618 0.0479

The net profit ratio indicates the percentage of net profit growth against the sales

of the company. Here along with the raise in the sales leading to the increase in

the net profit compared to the previous year of 2011.

Return on Assets: Rs. In Million


Earnings after tax 9287 6503

Total Assets 144603 138938

Return on Assets 0.0645 0.0468

The ratio indicates the efficiency of the investment in the assets to gain more andmore earnings. In 2011 though the investment in assets is more, due to the rise in

earnings there is increase in the return on assets, the company is in need to

concentrate in its activities to improve sales.


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Debt Equity ratio: Rs. In Million


Long term Debt 105612 101739

Shareholders equity 38991 37159

Debt Equity ratio 2.7086 2.7379

It is measure of the companys financial leverage. The company has implemented

debt: equity as 2.7:1 in 2011 and 2.73: 1 in the year 2010.

Return on Equity: Rs. In Million

Particulars 2011 2010Earnings after tax 9287 6503

Shareholders equity 38991 37159

Return on Equity 0.2381 0.1750

Return on equity reveals how much profit the company earned in comparison to

the total amount of shareholders investment. Due to the increased competitive

sales in its earnings lead to the rise in the ROE.


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Part

B


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1. A. General Introduction:

In Indian automobile industry car segments have played a very crucial and

significant role due to its increasing economy, efficiency and effectiveness. Due toinvasion of foreign cars into Indian markets, the pace of competition has hiked.

This has brought into market, number of Brands and their variants competing to

with each other. All these factors have resulted in flux in the minds of the

customers as to which brand to go for. In other words, Brand-switching is gaining

the momentum.

Today, the primary capital of much business is their brands. For decades, the

value of the company was measured in terms of its real estate, then tangible

assets, plants and equipments. However, it has recently been recognized that a

companys real value lies outside the business itself, in the minds of potential

buyers. For the potential customer, a brand is a landmark. Like money, it

facilitates trade. Faced with a multitude of silent or hard to-read products,

whose performance cannot be assessed at first glance, customer are confused.

Brand and prices make products easier to read, removing uncertainty. A

product price measures its monetary value, its brand identifies the products and

reveals the facts of its differences functional value ,pleasure value and symbolicvalue as a reflection as a buyers self image.

One word, One Symbol Summarizes an idea, a sentence and a long list of

attributes , values and principles infused into the product or service. A brand

encapsulates identity, origin and difference. It evokes this information

concentrate in a word or a sign. This is why brands are vital for business exchange

when faced with, say, hundreds of personal computers, a buyer can use brands to

structure this selection, to segment it, helping him to decide what he wants,

looking towards the products whose brand indicate that they will satisfy his

expectations, needs, or wishes. In markets in which technology and fashion mean

that the choice is constantly evolving, brands provide havens of stability,

describing an identity and promising constant features and direction.


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Brands are the real capital of business, yet brand management is still in its

infancy. At present, the tendency is to manage products that happen to have a

name. Management is still living in the age of the products, but brand

management involves other, specific approaches and principles. These are the

focus of this presentation

(i) Statement of the Problem:To position the brand in the minds of the customers the company or dealer

should keep the track of this shift in preferences. The marketing strategies can be

designed in accordance with this change. It will be helpful for the managers to

make decisions. Hence the main purpose of this study is to find the Brand

preference and the Buying behaviour of cars at Tumkur city.

(ii) Objectives of the Study:1. To find the impact of Brand preference amongst cars.

2. To understand the Buying behaviour of customers.

3. To know the facilities/services expected by the customers from the dealer.

4. To know the means of finance preferred by the customers

5. To know the significant attributes preferred by the customers in a car.

(iii) Scope of the Study:1. To know the most preferred brand by the customers.

2. To know the features considered by the customers while purchasing a car.

3. The study is restricted up to the Tumkur city.4. The study is considers the opinion of only 50 respondents.

(iv) Methodology:The information necessary for this survey is collected by tapping primary and

secondary data.


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Primary data:

The primary data is collected through the personal interaction with the customers

and by filling up the questionnaires.

Secondary data:

The secondary data for the study is collected thorough the company

websites, annual reports, brochures, bulletins, advertisements and so on.

The analysis of the data is made through the questionnaire and the attitude

scales.

Sampling allows us to concentrate our attention upon relatively small number of

people and hence devote more energy to ensure that the information collected

from them accurate.

Population: People from the city of Tumkur

Sample frame: People who owns car and prospect buyers.

Sampling size: 50 unit

Duration: 60 days

Data are useful only after analysis. Data analysis involves Converting a

series recorded observations into descriptive statements and information about

relationship. Hence concerned to this project method of analysis the data will be

graphical method, Simple Percentage method.

(v) Limitations of the Study:1. The study is limited the brand preference of cars.

2. The study confines to Tumkur city population.

3. The respondents are restricted to 100.

4. The analysis is to study the buying behaviour of the local customers.

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