Executive Summary

The motive of this essay is to give clear information about BMW ags entry into the luxury and premium automobile sector. The flow of the essay would start with the background and introduction about the company, then coming over to the mark et factors that led company to enter !" #, also about the entry strategy in ter ms of corporate decisions they took for doing business in !" # and what compani es present strategy in !" # is to gain the market share. Bayerische Motoren Werke $. m. b. %. &tarted operations in '('), the foundation stone was laid as late as '('* as Bayerische +lug,eugwerke #$ -B+W., it then cha nged into Bayerische Motoren Werke #ktiengesellschaft -BMW #$. in '('). n todays date. The list of ten largest automobile manufacturers features BMW g roup and even possess the brands like M ! and /olls0/oyce, the trio being the c ore heart of super luxury brands in the worlds industry. The BMW $/123& financial services also have a boosted stand in market and also the motorcycle sector is doing business successfully. BMW !" # 4ompany setting up head5uarter in gurgaon -the ncr. BMW !" # is '667 subsidiary of the BMW group. The investment initially in !" # is around '.8 billion !" # n rupees. BMW !" # is a $erman producer of cars and motorcycles marketed under flagship of BMW brand n 966* BMW focussed on one of the biggest and fastest growing market of luxury and niche car sector which is !" # and also looking at the fate of the competit or "aimler Ben,, grounded their tents in !" #. #lso allowing space for more inv estments in !" # following financial year for over :6 million again in addition the initial investment done. This is all for the premium automobile sector mark et in !" # which consist of about '.:7 which is in percent a small figure but w hen it comes to numbers it is around '6 million perspective customers in !" # a nd with the current market and economy this figure will certainly go up at the r apid speed !ow coming up to the factors which led BMW #$ to invest as fdi into !" #.

INTRODUCTION
BIRTH OF CARS
The birth of the car as we know it today occurred over a period of years. t was only in ')); that the first real car rolled down on to the streets. The earlier attempts, though successful, were steam powered road0vehicles. The first self0propelled car was built by !icolas 4ugnot in '<*( which could attain speeds of upto * kms=hour. n '<<' he again designed another steam0driven engine which ran so fast that it rammed into a wall, recording the worlds first accident. n ')6< +rancois saac de /iva, designed the first internal combustion engine. This was subse5uently used by him to develop the worlds first vehicle to run on such an engine, one that used a mixture of hydrogen and oxygen to generate energy. This spawned the birth of a number of designs based on the internal combustion engine in the early nineteenth century with little or no degree of commercial success. n ')*6 thereafter, >ean >oseph ?tienne @enoir built the first successful two0stroke gas driven engine. n ')*9 he again built an experimental vehicle driven by his gas0engine, which ran at a speed of : kms=hour. These cars became popular and by ')*; could be fre5uently espied on the roads. The next maAor leap forward occurred in ')); when the four stroke engine was devised. $ottileb "amlier and !icolas 1tto worked together on the mission till they fell apart. "aimler created his own engines which he used both for cars and for the first four wheel horseless carriage. n the meanwhile, unknown to them, Barl Ben,, was in the process of creating his own advanced tri0 cycle which proved to be the first true car. This car first saw the light of the day in '))*.The season of experiments continued across the seas in the 2nited &tates where %enry +ord began work on a horseless carriage in ')(6. %e went several steps forward and in ')(*, completed his first car, the Cuadricycle in ')(*. This was an automobile powered by a two cylinder gasoline engine. The +ord Motor 4ompany was launched in '(6: and in '(6) he catapulted his vehicle, Model T +ord to the pinnacle of fame. 4ontinuing with his innovations, he produced this model on a moving assembly line, thus introducing the modern mass production techni5ues of the automobile industry.The modern car, therefore comes from a long list of venerated ancestors, and its lineage will, hopefully grow longer as we progressD

HISTORY OF CARS
With the invention of the wheel in 8666 B4, mans Aourney on the road of mechani,ed transport had begun. &ince then he continually sought to devise an automated, labor saving machine to replace the horse. nnumerable attempts reached conclusion in the early '<*6s with the building of the first steam driven tractor by a +rench 4aptain, !icolas >acob 4ugnot.

t was however left to Barl Ben, and $ottlieb "amlier to produce the first vehicles powered by the internal combustion engine in '));. t was then that the petrol engine was introduced, which made the car a practical and safe proposition. The cars in this period were more like the cars on our roads today. With cars came the era of speed. The first ever land0speed record was established about a '66 years back, in ')(). 4ount $aston

de 4hasseloup0@aubat of +rance drove an electric car -in #cheres near 3aris. at a speed of :(.98 miles per hour. This flagged off the era of Ewheels racing, which lasted till '(*8, after which Aet and rocket 0propelled vehicles were allowed. Then onwards, it has been one big Aourney...on the roads.

ADVENT OF CARS IN INDIA

+rom the singsong rhythm of the bullock cart to the Aet0age, ndia has traveled a long way. #n average ndians dream car may not be the design0savvy %onda or the stately limousine, but he sure can dream, and afford, the Maruti now. t was in ')() that the first motorcar rode down ndias roads. +rom then till the +irst World War, about 8,666 cars were directly imported to ndia from foreign manufacturers. The growing demand for these cars established the inherent re5uirements of the ndian market that these merchants were 5uick to pounce upon. The %industan Motors -%M. was set up in '(89 and in '(88, 3remier #utobackmobile -3#@. was established to manufacture automobiles in ndia. %owever, it was 3#@ who produced the first car in ndia in '(8*, as %M concentrated on auto components and could produce their first car only in '(8(. t was left to another company, Mahindra and Mahindra -MFM. to manufacture sturdier utility vehicles, namely the #merican >eep. n the ;6s, the $overnment of ndia granted approval to only < car dealers to operate in ndia 0 %M, #3 , #@@, &M3 @, 3#@, MFM and Telco. The protectionist policies continued to remain in place. The *6s witnessed the establishment of the two0three wheeler industry in ndia and in the <6s, things remained much the same.&ince the )6s, the ndian car ndustry has seen a maAor resurgence with the opening up of ndian shores to foreign manufacturers and collaborators. The (6s have become the melting point for the car industry in ndia. The consumer is king. %e is being constantly wooed by both the ndian and foreign manufacturers. Though sales had taken a dip in the first few months of '(((, it is back to boom time. !ew models like Marutis 4lassic, #lto, &tation Wagon, +ords kon, the new look Mitsubishi @ancer are all being launched with an

eye

on

the

emerging

market.

n these last years of the millennium, suffice it is to say that ndian cars will only grow from strength to strength.

EVENTS & MILESTONES

# behind0 the0 scenes look into the making of one of ndiaGs most vibrant industries. The landmarks along the way... !"#$ The first imported car was seen on ndian roads !%"$%industan Motors incorporated !%%$ 3remier automobiles started !%#$ +irst car manufactured in ndia !&'$ The $overnment of ndia decreed that only those firms which have a manufacturing program should be allowed to operate !&&$ 1nly seven firms, namely, %M, #3 , #@@, &M3 @, 3#@, MF M and T?@41 received approval. !() $ !*) $ The two, three wheeler industry established a foothold in the ndian scenario. !*) $ !#) $ !ot much change was witnessed during this period. The maAor factors affecting the industry were the implementation of the M/T3 #ct- Monopolies and Trade /estrictive 3ractices #ct., +?/# -+oreign ?xchange /egulation #ct. and the 1il &hock of '(<: and '(<(. !#) $ ndian !!) $ The first phase of liberali,ation was announced by the $ovt. 0With the car manufacturers like monopoly, oligopoly, slowly began to disappear. liberali,ation of the $overnmentGs protectionist policies, the advantages hitherto enAoyed by the The $overnment agreed to the demand for allowing foreign collaboration in the automobile sector.#lso, the concessions it gave to the private sector and the new foreign collaboration policy, all resulted in higher growth and better performance of the industry than in the earlier decades.The $overnment of ndia tied up with &u,uki nc. of >apan which produced ndiaGs most successful car0 the Maruti. !! $ 2nder the $ovt.Gs new !ational ndustrial 3olicy, the license raA was dispensed with, and the automobile industries were allowed to expand freely. !!' $ With the winds of liberali,ation sweeping the ndian car market, many multinationals like "aewoo, 3eugeot, general Motors, Mercedes0Ben, and +iat came into the ndian car market. !!* $ The !ational %ighway 3olicy was announced which will hopefully have a positive impact on the automobile industry. The $overnment also laid down the emission standards to be met by

car manufacturers in ndia in the coming millennium. There were two successively stringent emission levels to be met by #pril 9666 and #pril 966;, respectively. These norms were benchmarked on the basis of those already adopted in ?urope, hence the names ?uro -e5uivalent to ndia 9666. and the ndian e5uivalent of ?uro . !!! $ The %onble &upreme 4ourt passed an order directing all car manufacturers to comply with ?uro emission norms - ndia 9666 norms. by the 'st of May, '((( in !ational 4apital /egion-!4/. of "elhi. The deadline was later extended to 'st >une, '(((.

LU+URY CAR MAR,ET IN INDIA

# luxury car is a luxuriously styled automobile which is designed to give satisfaction and comfort to its owner. # luxury car typically has carrying capacity of * passengers. The luxury cars in the ndian market are very expensive, with price tags that start from 96 lakh. %ence, luxury cars can only be afforded by the people who belong to the high income group and there are a lot of such takers in the ndian automobile market. The recent growth in the luxury car market in ndia is much more than mere market dynamics in a particular car segment. t is a reflection of the changing lifestyle of the affluent class in the country. n ndia, the luxury car segment -#verage 3rice 9;0:6 @akh. has been growing at an average rate of 967 or above during recent yearsH it seems to be least affected by the global financial crisis. "uring worst recession period when world was facing low market demand trends, ndian luxury car segment grew at 9:7 to *,*<' vehicles according to the &ociety of ndian #utomobile Manufacturers -& #M. despite a 6.;7 decline in passenger car sales, to ''.68 lakh vehicles -#pril0"ecember 966) /eport.. But financial year ended March 96'6 has shown growth of automotive sector up by 9;7 to ';.9* lakh vehicles. This indicates optimistic sign of recovery of sector. While the ndian auto industry is expected to grow at '<7 to '(7 on an average, sales of luxury and super0luxury cars are expected to grow exponentially.

@uxury car segment accounts only for :087 of total car sales in ndia. But what lures the international maAors is the fact that this segment is growing at 9;70plus -966( sales., much higher than ';0'<7 growth registered by the small passenger car segment over the past few years. This growth of luxury car sales is driven maAorly by increased wealth0 creation within average ndian population and the desire of individuals to Aoin the millionaire0club by flaunting their wealth.

LU+URY CAR MA-ORS IN INDIA

Mercedes0Ben,, BMW and #udi put together have around );7 market share. The $erman car brand Mercedes0Ben, had first0mover advantage as it had started operations in ndia in '((; and there was no direct competition in this category. &o, it remained E!umero 2no luxury car brand in ndia for more than a decade. But, market dynamics have changed significantly after the entry of BMW in 966* followed by #udi in 966<.

The overall market share of luxury cars has been reorgani,ed due to the new entrants. This has resulted in new e5uations being forged amongst the various players, driven primarily by a rapidly swelling millionaire0club having diversified choices and preferences. n 966*, BMW had (7 market share which has now grown to 897, catapulting BMW as the number one luxury brand in terms of sales. #udi which started its operations in 966< has had the fastest growth0rate amongst the three and has now captured 967 of the luxury car market. &o, the ndian luxury car market is favorable for new entrants who are capable of grabbing the untapped opportunities by following the customer0oriented approach and having ability to induce demand by innovation at each level of marketing mix.

COM.ANY .ROFILE BM/ M0t0re1

BMW is an acronym for Bayerische Motoren Werke AG00 or, in ?nglish, Bavarian Motor Works. Whatever you call it, the $erman0based company is one of the worldGs most respected automakers, renowned for crafting luxury cars and &2Is that offer superior levels of driving enAoyment. +ounded in Munich, the company began in the early '('6s as an aircraft manufacturer. BMWGs current logo, designed to represent white propeller blades against a blue sky, reflects these originsH its blue0and0white color scheme also references BavariaGs blue0and0 white checkered flag. t wasnGt until '(9) that production began on the first BMW automobile, the "ixi. The car proved tremendously popular, and its success helped the manufacturer weather the "epression. BMWGs best0known pre0World War vehicle was the Type :9) roadster, a supple two0seater that racked up over '96 victories on the motorsport circuit between '(:* and '(86. 3ostwar BMW cars maintained this tradition, winning several racing, rallying and hill climb victories

The early '(;6s saw the launch of the BMW ;6', a roomy, voluptuous sedan that was resplendent with all of the hopefulness of that era. t was soon followed by the ;69 which was powered by the worldGs first light0alloy I), foreshadowing BMWGs ongoing commitment to developing new technology. The best0selling BMW of that decade was the setta, a petite two0seat JmicrocarJ typically powered by a '90 or ':0horsepower engine. The mid0G;6s also saw the debut of the limited production and breathtakingly beautiful ;6< sports car which had an alloy body and used the ;69Gs I) for propulsion. n the '(*6s, BMW sales strengthened significantly, thanks in part to the immense popularity of the ';66, a sporty family sedan. By the '(<6s, BMW was establishing itself as a full0fledged car company. t was a pioneer for many emerging technologies, including turbocharging and advanced vehicle electronics. This was also the period when BMW of !orth #merica was established and consumers, who coveted both sports and luxury cars, became loyal JBimmerJ owners. The G<6s also saw the birth of BMWGs three0tier sport sedan range consisting of the : &eries, ; &eries and < &eries cars and the creation of its performance M division. More recently, the company has been expanding its reach worldwide. t opened its first 2.&. manufacturing plant in the latter half of the '((6s and has expanded its brand empire to include Mini and /olls0/oyce. BMW also continues to build motorcycles, something it has done since the '(96s. The automakerGs famous advertising slogan describes each of its vehicles as Jthe ultimate driving machine,J and itGs not mere hyperbole. 1ver the past couple of decades, BMWs have become the standard for performance and luxury in most of the Jover K:6,666J segments. With family0friendly wagons, crisp sedans, distinctive coupes, nimble sports cars and spacious &2Is offered, BMWGs model roster is diverse. But its luxury vehicles all share a common characteristicL the ability to make drivers feel gloriously connected to the road.

EARLY HISTORY BMW $roup, head5uartered in Munich, $ermany, is one of the most successful multi brand premium automobile manufacturers in the world. The company manufactures, distributes and sells passenger cars -including &edans, 4oupes, and 4onvertibles etc. and motorcycles. BMW operates three business segments namelyL #utomobiles, Motorcycles and +inancial &ervices. BMW is the parent company of the Mini and /olls0/oyce car brands, and, formerly, /over -car.=/over. The companyGs slogans in ?nglish are JThe 2ltimate "riving MachineJ and J&heer "riving 3leasureJ. The company produces, and markets, a varied range of a higher end sporty cars and motorcycles. BMW has also manufactured the first passenger car running on hydrogen ready for common use, although the production figures are limited by the lack of a respective filling station net. n addition to cars and motorcycles, BMW operates an aircraft engine division under the brand name of /olls /oyce. The company has worldwide subsidiaries and manufacturing plants in $ermany, #ustria, the 2B, the 2&#, Mexico, Bra,il, &outh #frica, ?gypt, Thailand, Malaysia, ndonesia, the 3hilippines and Iietnam. BMW $roup comprises of many segments within its vast portfolio, but would be only concentrating on #utomobiles. BMW group is focused on fabricating a variety of tangible products, and also the group has many intangible financial services. The BMW $roups automotive which am more interested in this easy is portioning of their portfolio consists of the three premium brandsL BMW, M ! , and /olls0/oyce of which would be more only looking at BMW and would also demonstrate their marketing. BMW is supported by '' different model series which areL BMW 4', BMW ' series, BMW : series, BMW ; series, BMW * series, and BMW < series, BMW M :, BMW M ;, BMW M * and the BMW N8, BMW M;, BMW M*, and BMW N8 M Well agree with the below statement which is being provided by BMW group which

states that the BMW offers emotional product to the customers this could be seen or felt with their current marketing strategies also with their &W1T analysis, 3@4 and as well as /esearch and "evelopment.JWe offer our customers emotional products, which through

the strength of the brand and the substance of the product fulfil the customers wish for individualisation and differentiationsO.

BMWs mission statement is clearly defined as PTo be the most successful premium manufacturer in the industryO, -/eference0 www.bmw.co.uk.. The main reason of BMWs success is recogni,ed by the development of a steady marketing policy. The company has built its brand and continues to focus on the following core values which is shown in the below figure. BMW has always maintained this core values since the companys inception. n addition to the message of these values, we can see it in advertising campaigns on television, press, maga,ine, trade fairs, motor shows, etc. We can also find company explicitly expresses one or more of these values in all BMW advertisements. %owever, we can also point out that BMW also banks on the sensitively to the environment, which we can see with the current advertising strategies of the company. BMW has always used a differentiated strategy, this means that they aim on

specific automobile markets. This markets suit different people within the specific segmentation. The markets that BMW would normally or likes to target are &ports 4onvertibles -N:, : series, and new N8., ?xecutive -: series, ; series., &uper ?xecutive -< series., Touring = ?state -: series, ; series., &uper sports -M series., and 8M8 -M;.. @et have a look at BMW competitor analysis where we can find BMW is a provider of premium cars and primarily serves for customer as if life time experience for them. BMW ensures to have full satisfaction to their customers. Moreover, also we can find out the competitors as their segmented markets. @ist of few BMW $roups series lines and brand names has to market specific competitors. ' &eriesL #udi #:, Iolkswagen $olf, #lfa /omeo '8<, : &eriesL #udi #8, >aguar M0Type, Mercedes 404lass, @exus &966, ; &eriesL #udi #*, Mercedes ?04lass, &aab (0;, >aguar &0Type, Iolvo &)6, * &eriesL >aguar MB, Maserati 8966, 3orsche ('', < &eriesL #udi #) and &), >aguar M> series, @exus @&866, Mercedes &04lass, M:L @and /over +reelander, M;L /ange /over, Mercedes M04lass, Iolvo M4(6, 3orshe 4ayenne, IW Touareg, #cura M"M, @exus $M 8<6, N8L 3orsche Boxster, #udi TT, 4hrysler &ebring 4onvertible, Toyota 4amry &olara, M /angeL M: 4oupe 0 Mercedes 4;;, #udi /&8, M; 0 Mercedes ?;;, #udi /&*, M ! L Mercedes # 4lass, 3eugeot 96* %=B, Iolkswagen 3olo, $T , $olf, /enault 4lio, +ord +ocus /&, Iauxhall 4orsa and Toyota Qaris, /olls0/oyce 3hantomL Mercedes Maybach, Bentley #rnage. BMW still remains the worlds most successful premium car brand with '', );,6)) units sold in 966* which beat the record of 966; by ;.97 level increase in the sales. MaAor Bey markets for BMW group have approx. *)7 sales in taly, 2&# and $ermany these three countries as in comparison to other countries. +urthermore, below in figures it shows to break down of sales figure for different segment in BMW cars

ST. STRATE2Y SE2MENTATION3 TAR2ET MAR,ET3 .OSITIONIN2 BMW uses three steps to targeting which are market segmentation, target choiceH product positioning. @ets see how BMW uses segmentation to identify specific buying characteristics. To find more information BMW looks at the geographic, demographic, behavioural, socioeconomic, and beneficial characteristics of society which helps them to target the market more effective. $eographically, the main markets for BMW where they are doing more than *;7 of sales are ?urope F !orth #merica as these areas are both heavily industrialised locations which results into residents are financially positioned to buy upper market cars as they capita income is more. The demographics of people who are able to purchase a BMW are men and women aged :6 R ;6 years old. Behaviourally these people have a successful image in their mind before buying the carH they also like to

want a clean modern look or sports look, and the feel good factor of an established dealer network. The benefits re5uired by these people are superiority, performance, reliability F 5uality. The image that BMW has managed achieved over the years is to position its self on the customers mind is superiority, performance, technologically advanced, 5uality automobile producer. The market where BMW is position them is highly competitive. /eason being for the competitive is the number of other automobile manufacturers that produce cars of a similar 5uality, price, and image. The main manufacturers that BMW compete with are as discussed before to name a few are Mercedes, >aguar, #udi, +ord, /ange /over, 3orsche, and etc. Most of these are blue chip manufacturers use differentiated strategies to produce large ranges of cars and has similar product life cycle which BMW follows. The difference is that each of these companies relies on different brand images to sell their cars. ?.g. >aguar is seen as a luxury, reliable and 5uality producer that BMW does but on the other hand #lfa /omeo is renowned for being stylish and performance breed but unreliable car as per the research. The positioning of these companies and their brands has been built up over many years but BMW has impressed their mark upon the public in a positive way with the help of good public relation and innovative advertising campaigning. This has lead to continuing sales growth throughout the international car markets. When we talk about Brand /ecognition BMW is an instantly recogni,ed brand name that has a reputation for its age0old tradition of 5uality. #lso many of us identify its logo from a distance during travelling in cities, highways, etc. 2nlike other lesser known luxury car manufacturers, this brand recognition allows BMW to redirect its resources from expensive advertising campaigns in a highly competitive market. The market in which BMW operates has being seen as good and loyal customers. MAR,ETS OF BM/ The main markets for BMW automobiles have been in ?urope, the 2&#, >apan and the 3acific region, with the markets of $ermany and the 2& accounting for almost half the total car sales. mportant markets have also been the fast0growing 2B, and the talian, +rench and >apanese markets. &ales in the 2&# market have been particularly successful,

as they grew by over ) per cent on the previous year to 9<<,666, becoming the biggest market for the group and overtaking the @exus brand for the first time. #t the end of 966:, the outlook for 9668 by group management and industry observers was upbeat. This view was supported by the successful launch of the new ;0series, the consolidation in ?urope and #sia of the BMW N8, the introduction of the BMW M:. The new BMW ' &eries and the BMW * &eries cabriolet were launched early in 9668. By far the most successful models were the M ! , the :0series and the ;0series, but the other models were also in significant demand. n the 4hinese markets there was growing demand for the higher end models of the range, specifically for <0series and ;0series. ?xhibit 8 shows the details of automobile deliveries in 966:. ?xhibit 8L #utomobiles delivered by the BMW $roup in 966: -'666 units.
1200 1000 800 600 400 200 0
I Se rie To s ta lD el ie rie s X5 W Se rie s Se rie s Ro yc e BM M W W BM BM Z4 IN

W 7

BM

W 5

Ro l

BM

n 9669, %elmut 3anke, a nuclear physicist, had become the new $roupGs 4?1, and started a strategy of internal growth through market and product development. n 966:, BMW was planning to launch a new model every three months through to 966;, providing a range of premium automobiles that ranged from the Mini to the /olls /oyce. The aim was to raise sales by 86 per cent a year for the next five years, and to achieve sales of '.8 million vehicles. Mercedes0Ben, would then become number two producer of

BM

W 3

ls

premium cars, and BMWGs long term ambition of being number one would be finally reali,ed. ?xhibit ;L BMWs top ten markets
300 250 200 150 100 50 0
a% y 'a (a % )r a% ce S( ai % # er $ Be l, i$ S ". ric a !S " !& Ita *+ i %a ly

To achieve the targets it had set itself, the company was pushing hard in the 2& and #sian markets to find buyers for the high0end models that they had found difficult to sell in the flat saturated ?uropean market. "ifficulties in dealing with labor cost control in the ?uropean political climate had also led BMW to expand its production facilities in the 2&, where the &partanburg plant was not running at full potential, and 4hina where a well 5ualified labor force cost much less than in the West. t was an ambitious plan that if successful, as well as giving the group greater prominence and profitability would also effectively cure the problem of vulnerability to ac5uisition. f %. 3anke was mulling over any of these concerns, he did not show it at the #nnual #ccounts of 3ress 4onference on '< March 9668, when he saidL We offer our customers emotional products, which, through the strength of the brand and the substance of the product, fulfill the customer's wish for individualization and differentiation !he BMW Group will never build boring products

MERCEDES 4 BEN5
Mercedes0Ben, has been associated with ndia for more than ;6 years. 3resently, Mercedes0Ben, domainsL

ndias engagement in

ndia covers several

@ocal production of Mercedes0Ben, cars Making available imported Mercedes0Ben, cars 4ommercial Iehicle operations, $lobal sourcing of auto components

4aptive automotive technology research and development

Social Involvement of Mercedes-Benz

Mercedes0Ben, is also involved with social0oriented programs across ndia likeL

EBiofuel from >atropha /oad safety proAect for children #utomotive education, etc.

C0m6a1y .r07i8e Mercedes0Ben, ndia has been delighting customers with strong brands and a wide range of products e5uipped with the latest in automotive technology. The company has been the pioneer of the luxury car segment in ndia with its inception way back in '((;. t is the only luxury car maker in ndia to have such a wide range of cars. The different ranges available today are the &04lass, ?04lass, 404lass, M04lass, 4@&04lass, &@B04lass, 4@04lass, $@0 4lass and the Maybach. We have also already introduced our high performance #M$ cars in ndia off late.

The depth of choices within these ranges is also extensive with different petrol and diesel engines. The time difference between the global and ndian launch of its latest models is constantly optimi,ed. We strive to make them available in the shortest time possible.

EMercedes0Ben, stands for tradition, innovation and the future of the automobile and represents 5uality and safety on roads throughout the world. Mercedes0Ben, /esearch and "evelopment ndia 3vt. @td. -MB/" ., a '667 captive unit of "aimler #$, was established as a research institute with eight employees in '((* and currently has a capacity of :*< employees.

Based in $ermany, "aimler #$ with its business units Mercedes0Ben, 4ars, "aimler Trucks, "aimler +inancial &ervices, Mercedes0Ben, Ians and "aimler Buses, is a global leading producer of premium passenger cars and the largest manufacturer of heavy0 and medium0duty trucks in the world. The companys founders, $ottlieb "aimler and 4arl Ben,, continued to make automotive history following their invention of the automobile in '))*. #s an automotive pioneer, "aimler and its employees are committed to excellence and act responsibly towards society and the environment, to shape the future of safe and sustainable mobility with groundbreaking technologies and high05uality products.

MB/" is the largest /esearch and "evelopment center of "aimler #$ outside $ermany and contributes in the areas of 4omputer &imulation -4#?., "esign -4#"., ?lectrical=?lectronics and T0&ervices. /esearch and development engineers at MB/" assess the performance and reliability of various sub0systems and contribute to product development in all the stages of the life0cycle.

1rganised in extended teams, the engineers collaborate with our partners in the /esearch F "evelopment 4enters and Business 2nits in $ermany, >apan and the 2&#. To prepare our employees for an effective collaboration in distributed teams across cultures, MB/" provides languages0classes as well as intercultural trainings and workshops.

A N A L Y S I S

S/OT ANALYSIS

SStre19t:; S&trong brand name S1wners club S&uccessful +' team S$ood /esale Ialue S$ood relationship with the government S/ea<1e;;e; S3rice

=O660rtu1itie;
"evelopment of new models ?nvironmentally friendly cars

Threats

/The current economic crisis

S&trong competitors S!ew entrants into the Market

RIVALRY AMON2 FIRMS

SThe rivalry among firms in the same market as Mercedes0 Ben, is highly intense. SThe main competitors within this segment includeL S BMW S #2" S >#$2#/ S #&T1! M#/T ! S #@+# /1M?1 /ivalry has led to firms producing similar range of vehicles, as well as expanding into new products or services e.g. financial services, alcoholic products etc.

THREAT OF NE/ ENTRANTS

S&egment is at low risk to the threat of new entrants. SThis could be down to the following reasonsL S 3/?&T $?L existing companies have set up their prestige over several years of providing 5uality products in the market. S M#T2/?=&#T2/#T! $ M#/B?TL the segment is at a saturated point where growth isnGt as high as the rest of the market. S &?T023 41&T&L the set up costs are high in this segment. S 42&T1M?/ B#&?L consumers within this market are likely to have developed tastes for specific brands

THREAT OF SUBSTITUTES
/Mercedes0Ben, has numerous substitutes that it has to be weary of. These
includeL S #@T?/!#T I? T/#!&31/TL this includes means such as buses, trains, motorbikes and planes. S #@T?/!#T I? 3/?&T $? 32/4%#&?&L because Mercedes0Ben, vehicles are considered luxury products, they also have to be cautious of other prestigious products that consumers could buy instead of Efancy cars. These includeL S "esigner 4lothing S ?xpensive=4ollectors +urniture S %olidays S @uxury %omes S #rt e.g. 3aintings, &culptures etc. S >ewellery S Boats=Qatches

BAR2AININ2 .O/ER OF SU..LIERS

/The bargaining power of suppliers is influenced by numerous

factors. These include the position of rival suppliers, the 5uality of goods and services suppliedH the demand for goods and servicesH and the supply of goods and services. SMercedes0Ben,s suppliers provide them with an array of raw materials re5uired in car manufacturing, including metals, leather, electronics, paints and rubber. S#dditionally, since Mercedes0Ben, prides its products on their 5uality, suppliers could increase their bargaining power through emphasi,ing the superiority of their goods. Mercedes0Ben, deals with two types of consumers, each with their own bargaining stanceL S 41MM?/4 #@L these are large scale buyers e.g. companies who purchase fleets. Their bargaining power can be increased by the scale of business they could offer the company and the presence of alternatives. S !" I "2#@L these are personal buyers. Their bargaining power is usually less than that of their commercial counterparts, however, the strength of rival brands and provision of substitutes are key factors that can affect their buying position.

Strate9ic Sc06e
SThe strategic scope shows the si,e and composition of the target market. n Mercedes0Ben,Gs case, the vehicle market in the 2B is worth T::bn in new cars and T:;.'bn in used

cars. 1f this, Mercedes0Ben, have a low market share, however, this is compensated by the revenue generated through their medium to highly priced products. SThe overall market contains various specifications of vehicles, of which Mercedes0Ben, is represented in all of them. This means that across the board, the firms market share will differ from range to range.

Strate9ic Stre19t:
S&trategic strength looks at the core competency of the business. SThe core competency refers to how well the firms conducts it GbasicG trading roles. Michael 3orter -'()6. pointed out : values that made up successful core competencyL S 3rovides consumer benefits S !ot easy for competitors imitate S 4an be applied to a variety of products and markets S1f the core competencies, the two methods that are used areL S 3roduct "ifferentiation S 3roduct ?fficiency

2ENERIC STRATE2Y

SThrough utilising 3orterGs generic strategy, we have been able to identify that Mercedes0Ben,Gs generic strategy targets the following marketL S !#//1W M#/B?T 0 MercedesG consumers fall within the minority of the market i.e. those of higher incomes, who want a luxurious product to associate with their lofty status. S " ++?/?!T #T 1! +142& 0 MercedesG strategy to distinguish them from rivals is one of differentiation, through providing both a luxurious vehicle, as well as one that is up to par with the latest performance figures.

STRATE2IC FIT
S&trategic fit refers to how a firm adapts its business practices to deal with changes in the external environment. S#s the motor0vehicle market is currently in a slump, it is essential that Mercedes0Ben, react appropriately to maintain their competitiveness in the market. S Taking into account MercedesG strengths, it is well e5uipped to deal with the current changes in the external environment. S Their strong brand name ensures that up0and0coming professionals will always aspire to own a Mercedes car to adopt the prestige associated with the brand. This will stay constant even throughout times of economic upheaval. S #dditionally, the good resale value of their products will mean that buyers will not be as worried about the depreciation value of the car should circumstances force them to sale it on. S @astly, the businesses good relationship with the government and ?2 will

mean that they could rely on tax reductions and stimulus packages should production be heavily affected by the motor vehicle crisis. S 1n the downside, the price will still be a hindrance when trying to attract new custom, especially given the hardship experienced when trying to obtain finance from creditors.

.RODUCT SU22ESTION
SWe would suggest that Mercedes0Ben, considered developing a product that would be suited to todayGs economic climate and social trends. S&uch a product would be relatively cheap -although not so cheap as to compromise their luxury status., have low running costs and be highly eco0 efficient.

ADVANTA2ES

1The new product has wider target market. 1#ttract consumers with a high, as well as middlelow incomes. 1&maller engine will help reduce petrol cost. 1 nsurance will be cheaper 1%as a lot of potential to be successful.

DISADVANTA2ES
1May compromise Mercedes0Ben,Gs luxury product status. 1/esearch F "evelopment into product could be costly, as well as manufacturing costs. 1May replace existing products in their range portfolio.

Re;earc: Met:0>0809y
The purpose of methodology is to describe the process involved in research work. This includes the overall research design, data collection method, the field survey and the analysis of data.

Objectives Of the Study

Objective of the Study: U To know the consumer satisfaction. U 4heck 4omparative 3erformance level. U To find the satisfaction amongst the customers with the Brand

S0urce; O7 Data C088ecti01

.rimary?
+or my survey primary data have been used as a 5uestionnaire to collect the data.

@ue;ti011aire # Aue;ti011aire is a research instrument consisting of a series of 5uestions and other prompts for the purpose of gathering information from respondents. #lthough they are often designed for statistical analysis of the responses, this is not always the case. The 5uestionnaire was invented by &ir +rancis $alton. Cuestionnaires have advantages over some other types of surveys in that they are cheap, do not re5uire as much effort from the 5uestioner as verbal or telephone surveys, and often have standardi,ed answers that make it simple to compile data. %owever, such standardi,ed answers may frustrate users. Cuestionnaires are also sharply limited by the fact that respondents must be able to read the 5uestions and respond to them. Thus, for some demographic groups conducting a survey by 5uestionnaire may not be practical.

SECONDARY? The secondary data has been collected from the following modesL U Maga,ines U Books U !ewspaper U "ata through internet sources

Re;earc: De;i91
/esearch "esign is the arrangement for conditioned for data collection F analysis of data in a manner that aims to combined relevance to research purpose with economy in procedure. # research design is a master plan or model for the conduct of formal investigation. t is blue print that is followed in completing study. The research conducted by me is a descriptive research. This is descriptive in nature because study is focused on fact investigation in a well structured from and is based on primary data. RESEARCH .LAN U Ty6e 07 ;tu>y? +or completing my study because looking at the si,e of population F the time limitation it was not convenient for me to cover entire population. %ence, have gone for sample study rather than census study. have gone for sample study

Sam68i19 .8a1
# sample design is a definite plan for obtaining a sample from a given population. t refers to the techni5ue or the procedure that researcher would adopt in selecting items to be inched in the sample i.e. the si,e of sample. &ampling plan is determined before data are 4ollected

Sam68i19 U1it

&ampling units are %igh 4lass and ?ducated people , Business Men etc. &amples are collected via personal interaction or via electronic media.

Ste6; I1 Sam68i19
Sam68i19 Frame? The list of sampling units from which sample is taken is called sampling frame. "elhi 4ity map was studied thoroughly and samples were selected from the place in a scattered manner to get effective result. SAM.LIN2 SI5E? Total sample si,e is ;6. The following sample si,e according to area wise is as followsL S '6 &aket S 96 Malviya !agar S 96 &outh 4ampus SAM.LIN2 .ROCEDURE? Sam68i19 tec:1iAue The selection of respondents were accordingly to be in a right place at a right time and so the sampling were 5uite easy to measure, evaluate and co0 operative. t was a randomly area sampling method that attempts to obtain the sample of convenient.

Limitati01; 07 t:e Stu>y

U will have to rely upon the information get from secondary sources -Balance sheet, 3rofit F @oss #ccount and 4ash +low . and given by respondents, which may not be fully true.

U This study will be limited to only some areas of !ew "elhi only.. U t is only for short period of time. U @ack of professional approach since researcher is a student U The sample si,e is only ;6 so the sample may not be truly representative of the "elhi population.

Fie8> /0r<
have collected the data through medium called 5uestionnaire collecting the responses from ;6 people in all. had done my field work in the following area. difficulty during my proAect in the process of explaining and taking there &#B?T , M#@I Q# !#$#/ , &12T% 4#M32& started my proAect very first educating the respondents about my entire proAect, and ask them to coRoperate with me. Mostly all the respondent were aware of this type of surveys. &o didnt face any type of difficulty in the 5uestionnaire.

Name? ;6 4lients of @uxury 4ars A>>re;;?

S0ut: De8:i $$$ Sa<et 3 Ma8viya Na9ar 3 S0ut: Cam6u; Area 3in 4odeVVVVVVVVVVVV 2e1>er? MaleL :; - <67. FemaleL '; - :67 .

A9e? '. Below') L 6

Age Group

1 2 3 4 5

9. ')09; L ; :. 9*0:; L 96 8. :*0;6 L 96 ;. ;' and above L ;

Occu6ati01? '. &ervice 9. Business :. &tudent 8. %ousewife

Occupation

1 2 3 4

@B C I1 y0ur O6i1i01 /:ic: car i; t:e Be;t D aC BM/ E (#FC

GC Merce>e; Be1H E '"F C

Merc0es BMW

@B"C %ow long have you been associated with BMW or M?/4?"?& R B?!N W - n years. a. @ess than ' year b. '0 ; c. ;0'6 d. More than '6 ) 96 '; <

1 2 3 4

@B'C %ow would you rate BMW Motors on the following parameterW Str0198y >i;a9ree Di;a9ree Neit:er a9ree N0r >i;a9ree A9ree Str0198y A9ree

iC

Bnowledgeable sales person

Kno w le d g e o f S ales P er s o n

2 4

#gree L :6 7 &trongly #gree L ;67 "isagree L '67

!eutral L 967

iiC ?mployees spent enough time with youL before sales L '67 "uring sales L )67 #fter sales L '67

1 3

iiiC "isplay of merchandise is attractive #gree L <67

&trongly #gree L :67 ivC #vailability of the product #gree L ;67 !eutral L 967 "isagree L :67

vC Iariety=selection of merchandise #gree L 867 "isagree L :67 !eutral L :67 viC Iehicle in good condition A9ree ? #)F Neutra8 ? ")F

viiC 3rices are affordable #gree L 867 "isagree L :67 !eutral L '67 "oesnt Matter L 967 viiiC#ttractive discounts offered Di;a9ree ? #)F A9ree ? )F Neutra8 ? )F

ixC "Xcor of the waiting area is pleasing A9ree ? *)F Di;a9ree ? )F

Neutra8 ? ")F xC 1ffered a test drive Ye; ? !)F N0 ? )F xiC 3ost sales follow ups are done regularly Ye; ? *)F N0? )F Ca1t Say ? ")F xiiC /esponds to complaints 5uickly A9ree ? !)F Di;a9ree ? &F Neutra8 ? &F xviC 4areful with personal information

A9ree ? !&F Ca1t Say ? &F

@B'C #re you aware of the following facilities provided by BMW MotorsW FACILITIES Ye; N0 iC Motors insurance Ye; ? ()F N0 ? %)F iiC ?xtended warranty Ye; ? #)F Ca1t Say ? ") F iiiC True value N0 Re;601;e

ivC finance Ye; ? !)F

N0 ? )F vC 1wners 4lub Qes L '667 !o L 67

viC $enuine accessories Ye; ? ))F N0 ? )F

@B%C /:ic: Car Have t:e Ge;t A7ter;a8e; Service D aC BM/ GC Merce>e; Be1H
AfterSales Service

Merce0e BMW 1 2

@B&C What is your overall opinion about BMW over Mercedes Ben,W

Iery Bad 6 Bad ; !either Bad !or $ood 96 $ood '; Iery $ood '6

Brand Comparison

1 2 3 4 5

@B(C %ow likely would you recommend BMW over M?/4?"?& B?!N W Iery 2nlikely ' ?) "? ) ' ? "& %? &
1 2 3 4 5

Iery @ikely 9 : 8 ;

&?)

@B*C /:ic: Car 6r0vi>e t:e Be;t Va8ue 70r M01ey aC BM/ ? "& GC Merce>e; Be1H ? "&

1 2

@B#C /:ic: Car 6r0vi>e; y0u Ii>e ra19e 07 Acce;;0rie; a1> A>>$01; D aC BM/ ? ") GC Merce>e; Ge1H ? ')

Accessories

BMW Merce0es 1 2

@B!C /:ic: 07 t:e 70880Ii19 Feature; 07 BM/ y0u 6e7er m0re 0ver Merce>e; Be1H D aC Su1 R007 ? & GC Aut0 Vi;u8aiHer ? cC Aut0 Se1;0r; /i6e; 1> .ar< ? & >C C01tr08 6a1e8 ? % eC Drive C01tr08; ? ) 7C Crui;e C01tr08; ? & 9C C01vertiG8e R007 ? )

Accessories

1 2 3 4 5 6 7

@B )C /:ic: C0m6a1y 6r0vi>e; M0re .0Ier7u8 a1> /e88 Tu1e> E19i1e; D aC BM/ ? & GC Merce>e; Ge1H ? ) cC B0t: ? "&

Engine Preferrence

1 2 3

@B

C /:ic: E19i1e ma<e y0u 6re7er t:e M0;t I:e1 y0u Buy a 8uxury

car D aC V( ? ! GC V# ? ) cC V " ? & >C VTVT ? ) eC CRDi ? (

Engine

*RDi 1T1T

16 1 18 112 2 3 4 5

F I N D I N G S

FINDIN2S
1n an average more than <:7 people feel that the prices are affordable whereas '97 do not agree, <87 believe that attractive discounts are offered whereas 9*7 are not satisfied with the discounts offered. 967 said that the test drives are not offered and ';7 said that post sales follow ups are not done regularly whereas );7 said that they were done regularly but people feel that it is the peoples car as it is satisfactory on all other parametersL knowledgeable sales persons , employees spent enough time before and during sales, display of merchandise is attractive, availability of product, variety of merchandi,e, vehicle in good condition, prices are affordable, attractive discounts are offered, dXcor of the waiting area is pleasing, responds to complaints 5uickly, service at Motors service station is

excellent, careful with personal information and is value for money . The overall opinion about Motors is very good. )*7 people agreed that the sales persons are knowledgeable and '87 strongly disagreed that the sales persons are knowledgeable. *87 people agreed that the sales persons spent enough time with them before the sales and :*7 strongly agreed with this. *97 agreed that sales persons spent enough time with them during the sales, while :87 strongly agreed that the sales persons spent enough time with them during sales and only 87 disagreed with this. *67 agreed that the sales persons spent enough time with them after sales, 9*7 strongly agreed with this and '87 disagreed that the sales persons spent enough time with them after sales. (87 agreed that the display of merchandi,e was attractive and *7 strongly agreed that the display of merchandi,e was attractive. ('7 agreed that the availability of the product was there, ;7 strongly agreed that the availability was there while only 87 said they disagreed with this. )<7 agreed that there was variety=selection of merchandi,e whereas <7 strongly agreed that enough variety was there and *7 disagreed with this. )97 agreed that the vehicle was in good condition when delivered, '*7 strongly agreed with this whereas only 97 disagreed with this. *87 strongly agreed that the prices are affordable, 9'7 agreed that the prices are affordable whereas only ';7 said that they neither disagreed nor agreed with this. ;;7 agreed that the discounts offered are attractive, :87 strongly agreed with this while ''7 disagreed and said that the discounts offered were not attractive. )67agreed that the dXcor of the waiting area was leasing while 967 strongly agreed that the dXcor of the waiting area was pleasing <87 agreed that the test drive was offered to them, *7 strongly agreed that the test drive was offered while 967 disagreed with this. ;(7 agreed that

the post sales follow ups are done regularly, 9*7 strongly agreed and ';7disagreed with this. 87 agreed that the response to complaints is 5uick, ')7 strongly agreed, '97 neither agreed nor disagreed and *7 disagreed with this. )97 said that the service at service station is excellent, '87 strongly agreed while only 87 disagreed with this. );7 agreed that yes they were careful with personal information,strongly agreed with this and )7 neither agreed nor disagreed. (87 strongly agreed that all the commitments were fulfilled and *7 agreed with this. ()7 said yes that they are aware about insurance while only 97 said that they were not aware.

CONCLUSION #s per details of &urvey /eport #nalysis and after Ierifying all the other details included in my study , n my opinion BMW is performing well , as per current scenario Mercede, R Ben, was the market leader but BMW with its features and "esign Mechanism is successful in attracting the youth so the demand for BMW is increasing. BMW is getting preference so currently both are at e5ual position but in near future BMW will crossover Mercedes0Ben, market legacy .

BIBLIO2RA.HY
B00<;? '. 3hilip Botler, Bevin Beller -966(., Marketing Management -Thirteenth ?dition. 9. Marketing Management, The Mc$raw.%ill 4ompany /aAan &axena -Third ?dition. MA2A5INES? #. 12T@11B B2& !?&& -+?B, 966(. B. B2& !?&& &T#!"#/" -#pril0>uly 966(. 4. 83& 1+ B2& !?&& #!" M#/B?T !$ ->une 966(. ". B2& !?&& T1"#Q 0 3ick and 4hoose ?. B2& !?&& T1"#Q 0 Tata Motors to bring >aguar, @and /over to ndia INTERNET?

'. BMW MotorsG 1fficial Website 9. Wikipedia :. httpL==www.docasi.com= 8. httpL==www.capitaline.com ;. Mercedes 1fficial &ite <. httpL==money.rediff.com=companies= ). htttpL==www.moneycontrol=com= (. httpL==www.yahoofinance.com=t '6. httpL==www.carwale.com=research=cars=

Bei19 a1 e;teem cu;t0mer 07 BM/ M0t0r; Lt>B y0u are reAue;te> t0 ta<e 0ut a 7eI mi1ute; a1> 7i88 t:e 70880Ii19 @UESTIONNAIRE? Name? YYYYYYYYYYYYYYYYYYYYYYY A>>re;;? JJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJ JJJ JJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJ JJJ JJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJ 3in 4odeVVVVVVVVVVVV 2e1>er?

Male Female A9e? Below') ')09; 9*0:; :*0;6 ;' and above Occu6ati01? &ervice Business &tudent %ousewife @B C I1 y0ur O6i1i01 /:ic: car i; t:e Be;t D cC BM/

>C Merce>e; Be1H @B"C %ow long have you been associated with BMW or M?/4?"?& R B?!N W -in years. a. less than ' b. '0; c. ;0'6 d. more than '6

@B'C %ow would you rate BMW Motors on the following parameterW Str0198y >i;a9ree Di;a9ree Neit:er a9ree N0r >i;a9ree a9ree Str0198y a9ree

iC Bnowledgeable sales person iiC ?mployees spent enough time after sale service with youL before sales

"uring sales #fter sales iiiC "isplay of merchandise is attractive ivC #vailability of the product vC Iariety=selection of merchandise viC Iehicle in good condition viiC 3rices are affordable viiiC#ttractive discounts offered ixC "Xcor of the waiting area is pleasing xC 1ffered a test drive xiC 3ost sales follow ups are done regularly xiiC /esponds to complaints 5uickly xviC 4areful with personal information xvC #ll the commitments are fulfilled

xviC Ialue for money @B'C #re you aware of the following facilities provided by BMW MotorsW FACILITIES Ye; N0 iC Motors insurance iiC ?xtended warranty iiiC True value ivC finance vC 1wners 4lub viC $enuine accessories C.8. Which 4ar %ave the best #ftersales &ervice W c. BMW d. Mercedes Ben, C.;. What is your overall opinion about BMW over Mercedes Ben,W Iery Bad Bad

!either Bad !or $ood $ood Iery $ood C.*. %ow likely would you recommend BMW over M?/4?"?& B?!N W Iery 2nlikely ' 9 : 8 Iery @ikely ;

C.<. Which 4ar provide the Best Ialue for Money c. BMW d. Mercedes Ben, C.). Which 4ar provides you wide range of #ccessories and #dd0ons W c. BMW d. Mercedes ben, C.(. Which of the following +eatures of BMW you pefer more over Mercedes Ben, W h. &un /oof i. #uto Iisulai,er A. #uto &ensors

k. 4ontrol panel l. "rive 4ontrols m. 4ruise 4ontrols n. 4onvertible /oof C.'6. Which 4ompany provides More 3owerful and Well Toned ?ngines W d. BMW e. Mercedes ben, C.''. Which ?ngine make you prefer the Most when you Buy a luxury car W f. I* g. I) h. I'9 i. ITIT A. 4/"i

"ateL 4ustomer &ign.