Nissan Vs Mitsubishi in Pakistan
Nissan Vs Mitsubishi in Pakistan
Nissan Vs Mitsubishi in Pakistan
Acknowledgements
Dedication
complete this project. We also realize that this project would not be what it is without the invaluable
support of our instructor, Ms. Ayesha Pervaiz, whose constant support and evaluation has allowed
We are also indebted to our parents for their constant support and supervision. We acknowledge
their love and high tolerance levels as being the primary reasons for our success.
DEDICATION
Whose unwavering support and encouragement has been an essential towards the completion of this
project.
EXECUTIVE
SUMMARY
1
This project is a detailed research about the marketing strategy of our client Nissan Sunny and its
competitor Mitsubishi Lancer. On the ground of our research we have made an analysis and reached
the conclusion that Nissan Sunny is a car of a competent quality, but doesn’t follow a marketing
strategy as such, due to which it is not a famous brand amongst the car users in Pakistan.
Our group undertook this task of re-launching this car in Pakistan. Since this car has the potential to
be amongst the leading car brands of the country, but lacking the proper marketing strategy it has
failed to impress the consumers. The research was based on information which our group gathered
from the internet, the General Manager of Ghandhara Nissan Northern Region and Senior General
Manager, Mr. Shahid Ikram, Senior General Manager, Corporate Affairs, Dewan Mushtaq Group,
and one of ex-board of directors’ members of Ghandhara Nissan. The information about the
customer tastes and preferences was carried out through survey forms/questionnaires. The
compilation of the report was carried out by the group once the required information was gathered.
We have also provided tables and charts in our report to make it easier for the user of this report to
We have given a detailed account of the problems faced by Nissan sunny in relation to its
competitors; also the group has come up with recommendations and alternative solutions to these
Our group has put in a lot of effort to research, analyze and compile this project and we hope that
everyone who uses this research will find the information ample and it will be beneficial for them.
2
INTRODUCTION
3
NISSAN
Nissan Motors Co. Ltd is a Japanese automobile manufacturer which formerly marketed vehicles
under Datsun Brand name. The company’s main offices are located in the Ginza area of Chuoka,
Tokyo but Nissan is currently planning to move their headquarters to Yokohama, kanagawa. by
2010, with construction starting in 2007.In 1999, Nissan entered an alliance with Renault S.A of
France to expand their brand. Nissan is among the top three Asian rivals of the ‘’big three’’ in US,
competing to be the market leader. Currently they are the third largest Japanese car manufacturer.
Nissan VQ engines i.e. 2.0 l to 4.0 L piston engines have featured among the world’s best Engines
Nissan has produced an extensive range of mainstream cars and truck, initially for domestic
consumption but exported around the world since the 1950s.Nissan also sells a small range of
keicars, mainly as a joint venture with other Japanese manufacturers like Suzuki or Mitsubishi Nissan
does not develop these cars. Nissan also has shared model development of Japan domestic cars with
4
Nissan’s Operations in Pakistan
In context Of Pakistan, Ghandhara Nissan Limited (GNL) is a group Company of Bibojee Services
(Pvt.) Limited which was incorporated in 1981 as a Private Limited Company having the sale
licensee for the distribution of Nissan vehicles in CBU condition in Pakistan; later in 1992 it was
GNL has Technical Assistance Agreement with Nissan Motor Co. Japan and joint Venture
Agreement with Nissan Diesel Co. Japan for the progressive Assembly of Passenger Cars, Light
Commercial Vehicles and Heavy Duty Vehicles. GNL’s Car and Truck Plants are located at Port
It is the only Automobile Company in the country assembling complete range of products i.e.
passengers cars, light commercial vehicles and heavy-duty trucks and buses.
The company is committed to achieve high quality products, customers’ satisfaction, market
leadership, contribution in the economic growth of Pakistan and comply with all regulatory and
Mitsubishi
Mitsubishi Motors Corporation was established on April 22, 1970. The main reason behind its
incorporation is the Development, design, manufacture, assembly, sales and purchase, importing and
other transactions relating to automobiles and to component parts and replacement parts of said
automobiles.
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Company products
• Colt
• Colt Plus
• Delica D:5
• Eclipse
• Eclipse Spyder
• Grandis
• Gallant
• Minica
• Triton
• Pajero Mini
• Outlander
• Pajero
6
• Minicab
In Pakistan Mitsubishi products are supplied by DMMC (Dewan Mushtaq Motor Company (Pvt)
Limited). DMMC is the only Distributor and Progressive Manufacturer of Mitsubishi Passenger Cars
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INDUSTRY
OVERVIEW
8
The current scenario for the automobile industry is in boom but is still facing numerous challenges.
The introduction of Tariff Based system (TBS) seems quite indifferent to protecting local industry.
In the new system, there is preferential treatment for new auto manufactures, which is counter
productive to the overall development of the auto industry .At the same time, the liberalization of
imports of used cars and new cars through gift scheme, transfer of residence and rising auto
financing rates have somehow restricted to little extent the growth of the industry.
After a healthy double digit growth for the lasts two years, the industry showed a modest growth of
8.1%.During the period under review, a total of 164,340 units were produced against 152010 units
by 21.8 and 12.8 respectively, over the same corresponding quarters of the last years, where as the
last two quarters of the last two quarters ending December and March 2007 showed decline of 0.5%
and 1.9 % respectively. In other sectors, the tractors production grew 8.1% due to improvement in
agriculture. The LCV, buses and Trucks posted growth of 27.3% and total of 46008 units were
The automobile industry in Pakistan in general operates under franchise and technical cooperation
agreements with leading world manufacturers and can be broadly categorized into various segments,
i.e. cars and light commercial vehicles (LCVs), two and three wheelers, tractors, trucks and buses
and vendor industry. The automotive industry contributed over Rs 30 billion to the government
exchequer in the form of duties and taxes in FY03, with a contribution of Rs 17 billion from the top
four manufacturers alone. The industry has achieved a phenomenal growth of 50.2 percent in 2005-
06 and increased competition has led to the introduction of innovative products as well as a decline
in financing costs.
9
INDUSTRY PROFILE
Since its inception Suzuki has been enjoying the position as market leader in small car segment.
While Honda and Toyota compete for the high price segment of the market. Suzuki commenced
production in 1983 eyeing the small and LCV car segment, 800cc- 1000cc. The industry continued
to be regulated until early 1990's, after deregularization, major Japanese manufacturer entered the
So far, Pak Suzuki, Honda Atlas and Indus Motor have been dominating the market, emergence of
competition this year was experienced by the entrance of Dewan Farooque, Ghnadara Nissan,
Daihatsu and Hyundai Motors in the market with a number of new product line. This intense
competition has totally changed the paradigm of Auto Industry in Pakistan. Pak Suzuki has been a
sole market leader in assembling 800cc and 1000cc small passenger cars as well as 1000cc jeeps,
Potohar. In 1993, Toyota started its operation and in the proceeding year 1994 Honda Atlas has
commenced its operation in Pakistan as the main competitors in 1300-2000cc segment but the
Suzuki has an edge over the market with 1300cc (Margalla) Baleno.
Automobile market has become more competitive in recent months as new players are going to
introduce their products in the market like Daihatsu has launched its 850cc Daihatsu Coure, Dewan
Farooque has launched its Kia classic 1300cc and Hyundai Santro Plus 1000cc car. There are a
number of new products like Kia Shuma 1500-1800cc car by Dewan Farooque Motors.
The sudden competition in small car segment is expected to pose challenge for Pak Suzuki, the
former lone player in the market and other leading name in the market. In near future, Dewan
Farooque will offer the widest range of products in the domestic automobile market. The trend of
10
localization is experienced at large in the industry. Toyota is also following the trend of localization
with 3o per cent on its all models of 1300-2000 cc Corolla. Toyota has also achieved an 18 percent
deletion on its 24 cc Hilux trucks, the deletion status in 1500 cc and 1600 cc models of its Civic cars
is about 30 per cent and 28 per cent on its 1300 City cars.
Increased deletion level and entrance of local manufacturers in Auto industry are the healthy sign for
the future progress of auto industry in Pakistan. It has been attracting investments and has the
potential to attract future investment. It is imperative to completely utilize the production capacity in
order to get the lucrative benefits for the country as well as organization.
The most striking issue in today's auto industry is the emergence of new competitors in the market
which is definitely a major cause to change the auto industry scenario in Pakistan.
Major Producers:
Suzuki motors
Suzuki is the leading name in small commercial vehicles and passenger cars.. Suzuki has so far a sole
leader in 800cc and 1000cc passenger cars as well as 1000cc jeep Potohar. But the emergence of so
many competitors in the market will definitely trigger a very hard time to Pak Suzuki. Suzuki has
launched Mehran 800cc, Cultus 1000cc, Baleno 1.3 & 1.6 Eli and Gxi, Bolan van & Ravi pickup
800cc and Potohar jeep. The total production capacity of Suzuki Motors is about 50000 units and
the total actual production in 1999 is 32,805. According to Pakistan Association of Automotive
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Parts and Accessories Manufacturers (PAAPAM) , Localization in other products like 1000cc
Khyber 42 per cent, 1300cc Margalla/Baleno 32 per cent, 800cc pickup 50 per cent 10 passenger
Honda
Honda is enjoying its key position in the segment of 1300 cc and above. Honda has launched many
models like Citi 1.5L, 1.3L to Civic 1.8L etc. The company has been consistently following the
Toyota
The company was formed as a public Limited company in December 1989, and started commercial
production in 1993.So far it has launched models like Corolla XLI, GLI 1.3cc, now Altis 1,8 VVTI.
Hilux $x2s/c and 4*4,Corolla has fast pace towards localization of 30 % on all its models which
It is the major competitor which has commenced its operation with a wide range of products in
domestic automobile market. Dewan Motors is basically a collaboration with Hyundai and Kia, two
Korean auto manufacturers. The initial response to Dewan's offering in the market with record
company booking of its Santro Plus. It has launched its Kia classic 1300 cc car with sophisticated
features. In future wide range of models like Kia Shuma 1500-1800cc car, Kia Sportage 2000 cc
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sports utility are expected to launch in the market. Dewan's presence in the market will give the
major move to the auto industry in Pakistan. The intense competition will give the benefit to the
Daihatsu
Daihatsu, another new player in the market with its Cuore 850 cc, increased the competition in the
market. Daihatsu and Indus Motor signed an agreement to launch the Coure in market. The project
worth Rs 750 million was developed at Port Qasim between Daihatsu and Indus Motor to produce
Suzuki for the first time faces competition in small car business. It is for the first time that Daihatsu
will produce its car in Toyota Plant in Karachi. The assembly plant of Daihatsu has the capacity to
produce 10,000 Cuore cars in the year. But the expected level of output in future will be some about
Vending industry
With the process of localization, vending industry is also contributing its share in the revenue and
creating employment. Indus Motor have 61 vendors with 13 technical collaboration, Pak Suzuki has
180 vendors with 15 technical collaborations, Honda Atlas cars have 59 vendors with 17 technical
collaborations. The auto part industry comprises number of different size vendors industries which
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The Association of Pakistan Automotive Parts and Accessories Manufacturers (PAAPAM) was
established in 1988. The main purpose of this association is to safeguard the vendors industry and
provide financial and technical assistance to its members. The vending industry has the potential to
increase its contribution to the Auto Industry as well as the economy of the country but it is
imperative that Government should encourage the investment in this sector and should protect
vendors 1 .
The local car industry may consider the import of used cars and it is neither against the import of
used cars nor demands any tariff protection in the new auto policy, said Shah M Saad Hussain,
‘’T’he industry had shown an average growth of about 25 percent over the last three years in
Pakistan whereas Toyota is about to surpass its global competitor in the international market.
He hoped that the growth rate is expected to be between 10 to 15 percent in 2006-07 as the
manufacturers have increased their production capacity manifold. He, however, denied that the local
carmakers were not producing to their full capacity and were deliberately creating demand-supply
gap to raise prices of vehicles. Contrary to his stance, the industry has forced the government to
revise the upward tariff in the proposed new auto policy for protection besides formation of a
1
http://www.pakistaneconomist.com/database1/cover/c2000-23.asp
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COMPANY
ANALYSIS
(NISSAN)
15
EXISTING PRODUCT LINE
Nissan Cefiro
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Nissan Sunny
Inside too, the Nissan Sunny is a matchless example of automotive excellence and a distinctive
expression of taste. It may be a joy to drive but it also offers class-leading levels of interior room and
comfort.
Travel fatigue-free in the spacious well appointed cabin, designed throughout to enhance comfort
and convenience. Featuring an abundance of luxury amenities and innovative safety features, this car
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Nissan Tiida
Nissan Tiida Sedan, the new comer! With its carefully sculpted body lines, this exceptional car is
highly contemporary yet has a timeless appeal. The company has continued to emphasize on the
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Nissan Patrol
Basically designed for adventurous drivers and special features of the car include its richly appointed
interior.
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Nissan X-Trail
This is basically a luxury car. It offers formidable 4X4 capabilities for wild terrain, moreover it has a
powerful yet fuel-efficient engine, sophisticated suspension, quality engineering, and exceptional
soundproofing.
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EXTERNAL ENVIRONMENT
Competitive pressures
The major competitors of Nissan in the Pakistani market are Toyota, Honda, Suzuki and Mitsubishi.
Nissan Sunny is in competition with Honda Civic and Toyota Corolla, both having 1.8L engines.
But it’s having head on collision with Mitsubishi Lancer because both the car brands are 1.6L, are
assembled in Japan and are shipped to Pakistan in CBU (Completely Built-up) condition. a car is an
expensive product and involves high customer involvement therefore, there is no generic category.
Every car that comes to the market has a specific brand name attached to it. The customers feel
Size
Of the total auto-market in Pakistan, Pak Suzuki Motor Co. (PSMC) enjoys the greatest market
share. Its 9-monthly production figures of 87,945 units from July 2006 – March 2007 indicate that it
is currently the market leader. It is followed by Indus Motor Corporation’s (IMC) production of
34,819 units during the same period. Honda Atlas (HA) comes at the third place in the Pakistani
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Growth
Looking at past trends of the sales volume of the above mentioned companies it can be seen that
the sales of PSMC and IMC have witnessed an increasing trend over the past 5 years. Likewise, HA
has also experienced the same growing trends over the past years but recently, due to the launch of
the 1.8 liter car, the sales of HA have declined to such a level that their sales have declined by 42%
Profitability
The profitability of a company depends upon its sales as well as its profit margin. Honda enjoys the
greatest profit margin per unit as opposed to a meager profit margin earned by Suzuki on the sale of
one unit. The profit margin of Toyota lies somewhere in the middle of Honda and Suzuki.
PSMC has to sell more and more units to earn handsome profits unlike Honda, which can earn the
Target markets
The target market of PSMC is the middle and upper middle income group as it offers small cars at
reasonable prices. IMC caters to the upper middle and elite class of the society by offering medium
and heavy cars. HA also caters to the upper middle and elite class by offering the medium as well as
Products
Bolan Camry
Ravi Prado
Potohar
Liana
The major weaknesses of the competitors is that they are offering locally assembled cars, which are
of substandard quality and they cannot be exported and the manufacturers have to ensure that they
sell their entire production volume within the country. Honda and Toyota have recently moved
from the 1.6 liter to 1.8 liter category resulting in a slight decrease in their sales. This is due to the
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fact that people in Pakistan prefer smaller and more fuel-efficient cars keeping in mind the economic
The major strength of the competitors is that their cars have higher re-sale value as well as easy
Potential Competitors
As a result of the prospering economy, more and more investors are coming to Pakistan. This also
includes the auto-manufacturers which pose a direct threat to Ghandhara Nissan. The potential
competitors can be further sub-divided into two categories i.e. imported vehicles and vehicles
Imported Vehicles _ these include the re-conditioned cars from countries such as Japan and Malaysia.
These also include the new cars coming from China, Malaysia (Proton), Korea (Hyundai) etc.
Vehicles manufactured in Pakistan _ a case in point could be the efforts being made be Dewan Mushtaq
Motors to acquire licenses from renowned car manufacturers such as Mitsubishi, Hyundai etc. once
these deals materialize, the company would start local assembly thereby, posing a direct threat to
Nissan.
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The present condition of Pakistan automobile industry supports tremendous growth due to private
The recent efforts from the government expect the auto industry to position itself to become
regional hub and a part of global supply chain by enhancing exports to the countries of the region.
In addition to that, Pakistan’s automotive sector has recorded impressive growth over the past few
years particularly due to boom from foreign investment. The auto industry’s share in total
manufacturing sector in 2005-06 was 16 percent as compared to 6.7 percent during 2001-02.This
rapid growth has been triggered by high economic growth, increased purchasing power of
In addition to that, most of the jobs would be created in the private sector and exhorted the people
from both the rural and urban areas to acquire training and skills for which a number of courses
were being arranged in every province, city and district. The rapid globalization; liberalization and
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increasing competition required a strategic direction and policy framework for sustainable growth of
According to Prime Minister Shaukat Aziz during his recent address to automobile industrialists at
PC Rawalpindi , he said:
‘Present government attaches great importance to the growth and development of automobile
industry as it is a key driver of economic growth and technology transfer and a creator of jobs. He
said that it would encourage indigenization and facilitate auto industry’s integration into global
supply chain.
The Prime Minister said that government support and incentives will aim at increasing the scale of
operations, expanding industry linkages and development of local vendors. He stated that support
will also be provided for technology acquisition, human resource development, cluster and
integration of international best practices for strengthening backward and forward linkages. These
linkages will facilitate domestic industry in adopting best practice management, processes and
procedures to deliver higher quality standards that are necessary in assessing international markets.
Shaukat Aziz said the government stands committed to establishing a world class automotive sector
which contributes to the national economy by way of economic growth, employment and exports.
He said that there was a growing per capita income and that Pakistan was moving from a developing
He also called steps to eliminate premiums in the auto industry which upset people by increasing
production and managing the import of used cars.’ We allowed import because your premiums did
not come down. Now that the premiums are coming down, we are going to review this policy so
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that you get a level playing field and expand and grow. Create jobs and create a good engineering
The Prime Minister said that Pakistan should be established as a manufacturing hub for the auto
He said that we have always benefited from Japanese investment, technology and assistance in every
field.’’
Inflation
As with the rise of the inflation, the buying behavior of the consumers also changes. In the recent
statistics of Pakistan, the inflation to 9.4%, though non-food inflation actually dropped to 5.2%
percent in the same period, inflation changed to negative to positive figures. The consumer price
index rose to 7.7 percent from 7.39.So with the increase in the inflation, the purchasing power of the
people have also been decreased but automobile industry, the brands are segmented to particular
class of the people. So for the people who have high purchasing power, it does not really matter to
them if they can actually afford a high luxury class, but for middle grouped income people, it does
really matter, they would either switch to low priced car or they may stop purchasing any affordable
car which they used to afford. So inflation has implications of the buying patters of the people.
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Consumer Confidence
As far as the consumer confidence is concerned, it is mainly identified by the brand the consumer is
associated with, if it suits consumer demands it enhances its confidence, but if it declines from its
standard, it obviously shatters the consumer confidence. Now if we take the external factors into
account, consumer confidence in the case of middle-income grouped people, the consumer has
plenty of options available because of the heavy competition growing in the industry, as Honda,
Suzuki, Toyota, etc are competing to gain the market share. For middle-income group, they all
conscious for all aspects of their desire like particularly price, quality, comfort ability, etc. So if the
cars fall short in any one of the following standard, it may actually induce the consumer to switch
best alternative.
are selective in picking up their brand, and secondly, they are mostly quality sensitive to what so ever
be the degree of the competition, not price sensitive, if the brand is continuously providing them
with the quality, they would have full confidence in their brand regardless of the price charged by
the company.
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Purchasing Patters
In our country particularly, the purchasing patters vary in accordance with the variation in the
income group. The people who belong to elite class prefer to buy luxurious class cars where as the
people which belong to mediocre families prefer cars that offer affordability matched with
convenience and durability. the trend is more apparent in big cities like Karachi, Islamabad,
Lahore, Peshawar Quetta and even in industrial cities like Faisalabad, Sialkot, people can afford to
buy much luxurious cars, because the buying power of people is more, they are more brand loyal,
prefer quality, not that price sensitive, and extremely selective. So they prefer luxurious cars such
brand of Honda city, Corolla, Civic, Surf, etc. This is typical for Pakistani scenario. In addition to
that, people with high affordability hand also import the kind of cars that they want. People with
low income-grouped either prefer mostly small cars such as Suzuki, Mehran or second hand cars.
They also look for the easy and cheap after sale services, the ease of the availability of the spare
Now in case of Mitsubishi and Nissan, they both are expensive brand, so they are mostly preferred
by the high purchased group of the people. The people who buy these cars are not price sensitive
rather they are quality, style and comfort conscious that company highly focuses upon, however,
since price is not the issue much, so both Nissan and Mitsubishi can cash on the slight variation on
their prices. The people sticked to their brand would not easily switch to other unless they really see
massive reason to switch their brand such as huge value added services, increased quality, change in
style shape In addition to that; many corporate and high-tech organizations owe these cars for
29
Business to business Economic Conditions
In the case of business to business Economic conditions, the there are not much collaborations on
business terms between the companies, however in Pakistan, Nissan is dealing in business to
business operations with National Logistic cell as its providing its trucks to National logistic cell,
These macroeconomic indicators have a direct bearing on automobile demand and accordingly,
automobile market in Pakistan has experienced unprecedented and unexpected growth in the last
three to four years. Sales of Passenger Cars and Light Commercial Vehicles have gone up from
45,000 units in 00-01 to 115,000 in 03-04 and are expected to go unto 150,000 in 04-05.
This phenomenal growth in demand was not anticipated by anyone and not even by the government
nor the car manufactures or the vendors. As a result of this tremendous growth all the manufactures
are continuously increasing their production capacities and the gap between demand and supply is
reducing. It has to be understood that increase in production capacity requires heavy investment,
30
transfer of technology, hiring and training of additional manpower, product development and trials
etc.
In order to reduce the demand-supply gap in the short term, the Government of Pakistan
substantially reduced duties on imported cars in the 05-06 budget, with a view to resolve the issue of
late deliveries and premiums that were being charged by the investors and resellers plaguing the auto
market. In the small car segment (up to 1000cc), import duties have come down to 50% only. The
most affected is the medium car segment (1001-1300 cc) where duties have been come from 100%
to 50%. Duties have been reduced by 30% for the 1301 - 1600 cc category and by 45 % for the 1601
- 1800 cc category. In the luxury car segment, duty has been reduced by 50% from 150% to 100%.
If we add up to 50% depreciation allowed by customs on used cars imported under the baggage
scheme, the landed price of used cars has reduced substantially. Thus it is not surprising that even
though only 6 months have passed since the announcement of duty reduction in the budget and
while it takes at least 3-4 months for imported cars to reach Karachi. After opening of LC, the flood
Mitsubishi Issue
countries, Dewan Motors has recently launched its network of dealerships across the country for
selling fully imported Mitsubishi cars with no local value addition or local assembly. This is an
indication of a CKD manufacturer opting for CBU business over local manufacturing. If other
manufacturers follow suit, then there will be a substantial loss of jobs, revenue to the government
will be reduced and the local auto parts industry will be the worst affected. What eventually forms
31
the basis of such business decisions is the consistency in government policies. If policy changes
render projects such as those of the auto manufacturing economically non-viable, the reason for
sustaining investment, expansion, employment, technology transfer, human resource training and
production is nullified.
Looking at markets that possess similarities with Pakistan, the Indian policy on import of used cars
is one case in point. We find that Indian car manufacturers are protected through tariff as well as
non- tariff barriers. Imported vehicles need to be evaluated by testing agencies set up in India to
ensure that poor quality and fuel inefficient old vehicles do not enter the country. Moreover,
registration charges for imported vehicles are higher compared to locally manufactured vehicles.
Other non-tariff barriers include conditions such as rejection of cars that are more than three years
old from the date of manufacture and submission of pre-shipment certificates by the importer.
Pakistani scenario
On the other hand, NTN (National tax Number) certificate is not required for purchasing imported
cars in Pakistan, which paves the way fake documentation. Thus importers and buyers of imported
cars are still exempt from documentation and tax net while all sales of locally manufactured cars are
fully documented with NTN certificate. While there is no equity or investment of the government at
stake in case of local auto manufacturing establishments, the revenue through duties and taxes paid
by auto manufacturers’ amounts to almost 30 percent of the vehicle price in Pakistan. While taking
straight benefits from the industry, at least the Government of Pakistan should devise a policy
framework in response that supports auto sector and safeguards their interests to enhance
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expansion, growth and further investment. Therefore, when we look at the recent policy change, it is
necessary that there is an impartial assessment of the positive and negative affects on the market, the
Apparently the recent policy decision of the government not only aims at slashing its own revenue,
but also hinders future investment and expansion plans of the auto manufacturers who are already
under lot of pressure due to government’s strict regulations on localization and price control. On
one hand auto manufacturers have been asked to increase production and maintain quality, while on
the other hand, less incentive have been offered to facilitate expansion and quality assurance. It may
be noted that a car may have 7,000 - 10,000 parts, and with government enforced localization targets
of 50 % to 75% for cars, there is a lot of pressure on local auto parts vendors to increase production
Contrary to the government’s expectations of a positive impact through duty reduction on import of
reconditioned cars, Pakistan has already begun to face the aftermath of the government’s
inconsistent policies. 2
2
http://www.nation.com.pk/daily/mar-2005/28/bnews8.php
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Changes in technology
experience dynamic change—change that sweeps across national borders. To succeed, auto
manufacturers must manage large and complex supply chains, spanning many geographic regions,
and pursue opportunities in diverse national markets. While national policies play an important role
in shaping the environment for local manufacturing operations and resulting products, cost
foreign firms are opening new assembly plants in the Pakistan, and foreign suppliers of parts and
components are building a domestic presence. The variety of motor vehicles is expanding and the
market is no longer dominated by a handful of very high volume cars. The biggest development with
respect to technology that has been observed is the lead time to deliver the car. Few years back a
customer used to get his car after 12 to 16 months after the order. While today it has been reduced
considerably from 16 to couple of months only, this has been achieved due to increase in demand
34
for cars thus leading to better productive controls being implemented by car importers and
manufacturers.
In today’s environment when people are more informative and have access to knowledge far more
easily then they used to have, so customers are more aware with regards to their buying behavior
and purchase decisions. Car manufacturers thus tend to provide and attract customers through
valuable information.
Such information plays a vital role in timing and purchase decision of customers. Although car
purchasing decisions have been considerably complimented through the introduction of car
financing by various banks and companies but we also found out that it is also being influenced by
the annual budgets and car taxation and policies being implemented by the Government of Pakistan.
Pakistani family lifestyles have also changed. There are more working women, which have changed
commuting and errand-driving patterns. Families once had a commuting car for the wage earner and
a larger car for family use. Often now they have two wage earners instead of one, and the second
family vehicle is a small car or utility vehicle to supplement the family car. Pakistani automakers and
distributors have been very effective in creating and supplying this new market, excelling in economy
Another trend influencing the automotive industry is consumer preference for certain features.
Consumers are choosing safety (e.g., airbags, antilock brake systems) with amenities (e.g., air
conditioners, powerful engines, power steering, and compact disc players) over vehicles whose
primary appeal is size and interior space. Factors influencing customer choices are performance,
suitability to personal needs, and family lifestyle, safety, comfort, and appearance.
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Effects of technology on industry operations
Technology
The automobile is a highly engineered, sophisticated product that meets stringent reliability,
durability, and social requirements. Its design, manufacture, and operation call more and more for
cutting-edge technology. The Big companies have a long history of aggressively pursuing research
and development (R&D) to stay competitive, to meet the changing needs of the consumer, and to
meet governmental requirements. The diverse ways in which the companies meet this technology
With both vehicles and transportation infrastructure incorporating more electronics into their
systems, the auto industry will likely grow as a consumer of electronics components and as a driver
of electronic technology development. Like many other industries, the automobile industry is rapidly
increasing its use of electronic components. Virtually every aspect of driving a modern high-end
navigation, driver information, crash protection, steering, etc. This trend is likely to continue. In
addition, the automotive infrastructure—traffic control and guides, law enforcement, toll
assessment, and the like—rely increasingly on electronic controls. As a result of both of these trends,
the auto industry will likely grow as a consumer of electronic components and systems and as a
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Cooperative Research and the Partnership for a New Generation of Vehicles
Complementing their individual efforts, the Big automakers have also placed increasing emphasis on
research collaborations with one another, with their suppliers, and with the federal government. For
example in 1992, Chrysler, Ford, and GM created the United States Council for Automotive
Through this cooperative effort, resources are coordinated more effectively to conduct research and
Besides working with each other to research and develop technologies for the next generation of
vehicles, the Big automakers are working with the governments in a cooperative, pre-competitive
research effort called the Partnership for a New Generation of Vehicles (PNGV).
At an early stage of the partnership, the participants recognized the importance of involving the
traditional base of automotive suppliers as well as some nontraditional sources of supply. Since that
time, a special effort has been devoted to understanding the supplier community, recognizing its
importance as a source of technical innovation, and finding means for its effective interaction with
PNGV. Currently, more than 400 automotive suppliers and universities have joined in PNGV
The world’s automotive manufacturing sector consists primarily of about 20 very large multinational
corporations. The automotive supply sector, however, comprises thousands of firms ranging in size
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from a few employees to more than 100,000. Drawing conclusions about such a large and diverse
Best practice in automotive supply chain management involves close, trusting relationships with
long-standing suppliers that are intimately involved with the development and production of the
Several of the Japanese-owned assemblers (Honda and Toyota in particular) have established
intensive technical assistance programs for their U.S.-based suppliers. For example, in Honda’s BP
program, a team including Honda technicians, supplier managers, and supplier workers studies one
process for several months and makes suggestions to improve it. This process has led to 30 to 40
percent improvements in quality and productivity in that area for each of the few dozen suppliers
Automotive distribution and retailing were once given little attention because they were viewed as
adjunct to the core business of engineering and manufacturing vehicles. However, in the past several
decades, the pressures on the industry to make its factories and product development processes
more efficient have spilled over into the distribution and retailing (post-manufacturing) sectors—
cutting profit margins and causing significant restructuring in the distribution and retail industry
base. This restructuring, although quite significant, has attracted much less attention than the
economic base. These downstream segments of the supply chain are experiencing a shift from being
capital intensive (focused on inventory investment) and people intensive (sales forces) to being more
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information intensive (having the right vehicle in the right place at the right time). Due to greater
flexibility of labor and capital in the post-manufacturing markets, this conversion from physical
logistics to information logistics is shifting the power and leverage in the supply chain toward
Faced with the increasingly complex and competitive environment that characterizes the automotive
industry – with challenges ranging from tighter profit margins to new entrants in the new vehicle
and aftermarket service business – original equipment manufacturers (OEMs) and dealers are
turning more aggressively to customer relationship management (CRM) to help attract new
customers, increase brand loyalty, reduce costs, increase efficiency, and maintain a competitive
advantage.
Today’s automotive consumers are increasingly well-informed and have an unprecedented level of
choice in the marketplace. Customer loyalty is no longer a granted, and forward-looking automotive
companies have to work harder than ever to earn and retain it. To respond to high customer
expectations, companies are finding they have to use both traditional and emerging channels to
deliver more effective, efficient, and profitable marketing, sales, and customer service.
To truly get to know and understand their customers, automotive companies are looking for ways to
gather and analyze vital data about their customers, their vehicles, and their transactions with dealers.
Only then can they effectively match their products and service offers with the customers they want
to target. So companies need to be able to track customer behaviors and then to link that
information to not only the production scheduling process – to build the right products now – but
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also to the product development cycle – to bring new products to market faster. And because
OEMs and dealers now often need to collaborate closely, they need to be able to share information
Ceramics
Engineering plastics
High-strength steel
Gas turbines
Fuel cells
Advanced diesels
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Energy Storage Devices Ultra capacitors
hybrids)
Flywheels
distribution)
Simulations
Fluid dynamics
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Reduction of Tribology
casting)
management
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Internal Combustion Engines Direct injection
Reformers/fuel processors
conditioning
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Technology Computer simulation of vehicle crashes
including sensors
Socio-cultural trends
The economic scenario of Pakistan is reaching a stage where the income disparity between the lower
class and upper class is increasing. According to an estimate, twenty percent of the elite class is
increasingly aware about several car related issues i.e. quality, price, re-sale value, availability of after-
sales service etc. these trends will have an impact on Nissan in the following ways:
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Product
The new product offering should be more appealing in terms of providing better quality, comfort,
Pricing
As a result of new competitors, each automobile player has to charge a competitive price. High
prices can also be charged but have to be justified in terms of added value, quality and convenience
to the consumers.
Distribution
An automobile is such a product which is normally made available at exclusive showrooms of the
company that manufactures it. This adds to the convenience of the customers because they can have
a variety of cars and SUVs offered by a company. They can also easily locate the showrooms (using
Promotion
The promotion methods are evolving i.e. companies need to have a promotional presence over all
mediums. The use of internet is increasing, and so companies must practice internet marketing in
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People
The companies now try to be more customer-centric than ever before. To maintain this customer
focused attitude, the company must conduct training for its employees in order to prompt them to
combined with the alarming global warming issues have led to the formation of several laws in
almost all countries. Several global organizations are also working to save the environment. In this
scenario, auto manufacturing companies must also incorporate environment friendly policies in their
processes. Now, the companies need to come up with environment-friendly cars that are fuel-
efficient as well. The efficient V8 engine, hybrid cars, solar cars, electric cars are some of the
innovations resulting due to the above mentioned factors. The formation of corporate social
responsibility (CSR) would also help the company form a stronger image in the customers’ mind.
it always takes customer care and their demands in account at international level. With its carefully
sculpted body lines, this exceptional car is highly contemporary yet has a timeless appeal.
Internationally, the brand name of Nissan is already established and people residing in foreign
countries always opt for this brand. In Pakistan the company is trying to make improvements in the
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fields of customer relationship, customer satisfaction and customer retention. The auto market is
continually confronted with ever increasing technological innovations and changes in customer
requirements. With such changes, the role of marketing department has been intensifying in
importance year after year. Apart form marketing, providing customers with high quality After Sales
Services has also become decisive for Ghandhara to maintain its edge over the competitors.
The customer care and after sale services should take into account these following things:
Ghandhara Nissan’s prime objective is to achieve maximum customer satisfaction, which ultimately
leads to highly profitable results. Their major operation revolves around customer satisfaction.
The company should have a team of professional to achieve the following goals:
• Customer follow-up
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• Free checkup campaigns
• CSI survey
In order to provide efficient after sales services to our valued Nissan customers the current
dealership network is being strengthen and expanded further keeping in view customers demands
and expectations.
In this regard countrywide surveys are conducted time to time to evaluate/mark the cities/areas.
Moreover if dealers already exist at such location, the existing dealer’s facilities are upgraded on
regular basis.
Customer Follow-Up
In order to provide personalized services to each and every Nissan customer, they should emphasize
Dealership is maintaining customer profile and full service history of the each unit, including all
Dealership has computer data based records of all their customers with their mailing addresses.
These mailing addresses are valuable for marketing purposes as well. An improvement to this system
can be that the dealers should mail the reminder for next due checkup, seasonal campaign and free
checkup. Advance information about new products to be launched in future and other promotional
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activities intimation for their customers should also be mailed. This will increase loyalty, help in
Service staff should visit periodically to service dealerships to collect product feedback information
and to assist / guide the dealer in resolving their day to day problems.
Further, technical specification and features of product should also be discussed in order to update
their knowledge about product. During visits, the Service Staff should attend customer complaints
Ghandhara Nissan should launch countrywide Free Checkup Campaign, on annual basis at their
dealerships. Schedule of campaign should be advertised well before commencement through leading
Thorough checkup of vehicle should be performed by the team of Nissan experts and necessary
advice regarding daily checkup, periodic maintenance and repair should be given to end users for
durability and the best performance of Nissan range of vehicles. Moreover campaign would help
collect customer’s feedback about product performance and improvements to enhance their
satisfaction.
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CSI -Survey
In order to evaluate the product performance and opinion of users/ customers about the product
and quality of after sales services that customer expect and should receive, is conducted by mailing
the CSI Survey Form directly to individual Nissan customers and by interviewing the visiting
The core brands of the company Nissan Sunny are mainly cars and buses/trucks. As the focus is on
cars only so taking into account the performance of Nissan Sunny cars internationally their
performance is quite satisfying and it has established a fair number of loyal customers who always
To be truthful, the Sunny name dates from another era. It was originally applied to a family Datsun
back in the late sixties as one of the products that really gained the Japanese a foothold in Britain.
After that of course, there were numerous Sunny spells, but the only two worth worrying about as
far as the used buyer is concerned are the final generations, both of which appeared long after
Datsuns became Nissans and the company had improved its rather cheap and cheerful image.
There were no fewer than five body styles offered across the two Sunny line-ups, including three
and five-door hatchbacks, a four-door saloon, a five-door estate and a rare coupe. Arguably, you
could also include the little 100NX sports car, since it was based on the 1.6-litre.
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Take the special edition Nissan launched for the lucrative 1st August 1994 M-reg market, the Sunny
Spray. Offered with either three or five doors, it came with an electric sunroof, power steering and a
The gearbox clicks from ratio to ratio with the minimum of effort while the steering even when not
power assisted is light enough to making parking simple. Slip inside and the driving position is
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INTERNAL ENVIRONMENT
For a firm to be successful in the long run, employees should be a major area for focus, because if it
is capable enough to satisfy its employees, only then it can expect to satisfy its customers. This is
attributable to a simple fact that the lower level employees are the ones who have to cater to final
customers. Therefore many firms are moving towards decentralization for the empowerment of
junior level employees. In Mitsubishi, the top management makes all efforts to satisfy the employees
so that they can give better results. It offers a perks menu for its middle managers so that they can
choose between the several benefits. This basically means that the employees are offered 2 to 3
different packages and they are to choose from them. For the lower level employees they have
commissions. Therefore the employees are satisfied and the turn over is less about 5%. The
Nissan cars being sold in Pakistan come in completely built-up unit (CBU) condition. It is an
established fact that the Japanese are quality conscious people and do not compromise on quality.
This high quality is also reflected in the assembly of Nissan cars being sold in Pakistan. So, a
common customer cannot differentiate between a new model of the Nissan sunny car and its old
model in terms of quality, reliability and performance but find the new models even more appealing.
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The customers who use Nissan currently don’t even think of switching their brands, even if other
The performance of the auto-industry in Pakistan is increasing with regards to the sales volume. This
is due to the increase in per capita income of the Pakistanis. As with the passage of time the
Pakistani share in the locally assembled cars is increasing, which has resulted in deteriorating the
quality standards. With the increase in buying power, the quality consciousness of the people has
also increased. As a result, people prefer buying Japanese assembled cars of high quality. This trend
has also affected the sales of Nissan for the better; however, their sales have not increased in
revamp its current marketing strategy and formulate a competitive marketing and promotion
campaign to create visibility in the market. Currently the car has a very low sales volume as
compared to the sales averages of its competitors. To increase the sales, massive promotions have to
be undertaken. For this, a considerable amount of budget should be set aside for promotions. As the
sales volume is low, therefore, the promotion budget should not be linked to the sales volume rather
it should be independent of the sales i.e. the objective and task method of allocating budget for
the company’s control to do much about it. But the company can counter this by providing a
consistent and promised quality to the customers and then communicating it effectively.
Ghandhara Nissan Provides complete range of vehicles and services that deliver superior measurable
values to all stakeholders in alliance with Nissan Diesel Motor Co. and Nissan Motor Co. Japan.
The financial status of Ghandhara Nissan; the manufacturer of NISSAN SUNNY in Pakistan is as
follows:
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This shows that the net sales of the company have increased from 2005 to 2006. Consequently, the
profits of the company have also increased. The trends show that the customer base of the company
Car manufacturing is a specialized and skill oriented task, so it requires human resource with
technical skills and know how with regards to their respective jobs at hand. This human resource
also consists of administrative, financial and marketing departments that are involved in the smooth
The company has seen considerable growth and has actively participated in the advancement &
development of automobile industry as a whole. The human resource will have to face stiffer
challenges in future due to the upcoming implementation of WTO. This will mean that the human
resource side of car manufacturing would need to further polish and improve their skills because
newer and better technology will certainly replace the existing for resulting in better productivity and
INPUT CONTROL
MECHANISMS
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While hiring new employees there are mainly two main grounds on which the company does
recruitment. Firstly it looks for the skilled labor that has to do work rigorously in the manufacturing
and production area. The criterion is a technical skill diploma holder with at least a matriculation
degree. The other types of people required are those for the administrative department. These
people are recruited on the basis of a preliminary interview. In addition to this the person should
have a 6 month experience in the industry. There is a 1 month probation period after which the
employee becomes permanent. Then they are given 1 year on the job training and they are directed
to rotate their jobs as well. This trains them for “multi tasking”. HR decides about the employee
man power allocations. It has special teams to monitor the performances of employees and
according to that gives rewards and benefits. Also it measures employee productivity and allocate the
working hours accordingly. As far as the financial resources are concerned, the company is a listed
company and is financed by various permanent banks in the country as well as by foreign banks.
Bank AlFallah, Allied Bank and Bank Al-Habib are among a few to name.
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Since the use of these metals is presently quite restricted to vehicles of the upper segments of the
market, a transitional solution may be to use high and ultra strength steels as well as tailored blanks
and steel sandwich. Further improvements can be achieved through the use of such manufacturing
technologies as tubular and sheet hydro forming, and laser welding that will increasingly be used in
metal processing. Combined, they will yield weight savings and improved performance.
The wave of mergers and acquisitions 3 that has swept the automotive industry will probably
continue during the next years but at a slower pace. Underlying the repositioning of the OEMs is the
realization that important gains can be achieved from the exploitation of synergies resulting from
overlapping or complementary activities. The clearest gains are undoubtedly in joint purchasing and
In a period when differences between distinct models within the same group are progressively being
eroded, brands are progressively the principal distinguishing factor between vehicles. While the
3
http://in3.dem.ist.utl.pt/master/thesis/98files/6thesis.pdf
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reasons underlying merger and acquisition decisions may vary among OEMs, generically, the use of
common platforms, motors and assembly lines, and the benefits in terms of supply chain
This concentration and the move by some automakers towards world car programs will have
significant repercussions on the relationship with suppliers. Once again, capacity may be the main
issue that suppliers will have to deal with if they want to maintain a first tier position. In fact, since
most mergers are partially based on exploiting the cost benefits of using the same components in
different models and brands, suppliers may have to boost production capacity in order to supply a
group as opposed to supplying a single OEM. Secondly, suppliers are increasingly expected to
accompany OEMs irrespective of assembly plant location and, as such, investments have to be made
in creating capacity where it is needed, that is, near the assembly plant. Suppliers have met this
challenge by establishing joint ventures and acquiring foreign firms in the countries where OEMs
have manufacturing facilities. From the suppliers’ point of view, increased pressure will be put on
production capacity, since OEMs, almost certainly will not increase the number of suppliers of a
specific component but will probably maintain or decrease the number of first tier suppliers.
Whereas for the larger suppliers this may mean greater levels of specialization, in the case of smaller
suppliers that wish to maintain a first tier position, the answer may be in increasing overall
production capacity.
Compensation Strategy
The competencies and resources involved in the design, manufacture, and assembly of
approximately ten thousand different parts which currently constitute a vehicle and the amount of
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information used and generated by these processes have made the management of this complexity
So the biggest job at hand for NISSAN would be to collaborate with other automobile
manufacturers with regards to the usage and implementation of better technology and equipment.
This in turn would compensate for its upcoming challenges with regards to WTO and would also
Strategic uncertainties
Due to misconception in the customer’s minds, they are unwilling to buy NISSAN because they
think that as it is an imported car it would be difficult to get its spare parts and after sales services. It
is facing stiff competition in the market and has a very low customer base. Their inventory turnover
Some of the strategic decision options that NISSAN can opt for are as follows:
Promoting after sales services to increase and promote a loyal customer base.
Beside that NISSAN needs to conduct a detailed strategic analysis of Pakistan automobile industry
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Automotive related purchasing intentions and preferences of the various population groups.
The other aspects that they can look into can be the general information about the buyers which can
be:
• Family status
• Education
• Purchased of leased
Purchasing habits regarding in-car electronics Usage of garages and repair shops
• Service centres
• Other
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• New vehicles with alternative drive systems
• Used vehicle
• ABS
• Small car
• Compact car
• Cabriolet
• Van
• UPV
• Etc.
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• Magazines
• Newspapers
• Radio
• Internet
Such information will also help to establish a vital link for the formulation of strategic marketing
overcome any resistance to change. It informs, ands involves all staff in new initiatives and
strategies. It is simple to construct, especially if you are familiar with traditional principles of
marketing.
If not, it would be valuable to spend some time considering marketing plans. Internal marketing
obeys the same rules as, and has a similar structure to, external marketing.
4
http://marketingteacher.com/Lessons/lesson_internal_marketing.htm
63
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The practicalities of internal marketing can be better explained by the following figure:
• Always making sure that it had thought through its approach before starting the
implementation.
• Making sure that it has created a cultural climate that is willing to accept change.
• Appointing a change agent, or champion for change that will help to ease its changes
through.
• Auditing the skills and capabilities of its team. Training and developing as necessary.
• Teams must be built around it with the objective as the focus for all.
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• The change must be correctly marketed to its target audience.
• Trying to anticipate the arguments against change, and deciding how to counteract them
positively.
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SWOT ANALYSIS
Strengths
The following features have proven to be some of the strengths of Nissan Sunny Car:
Safety
On of the main strengths of Nissan Sunny Car that the company claims is safety. The impact
absorbing body of the car is divided into two separate zones. One is a crushable zone designed to
absorb the force of an impact. The other one is a safety restraint zone that acts as a protective shell
around the vehicle occupants. Nissan Sunny Car also contains a driver side airbag that ensures safety
of the driver as well. This is one of the major distinguishing factors of Nissan Sunny Car that its
Quality
Nissan Sunny has been and remains up till today a name which is synonymous with quality. The
quality of this particular car brand has never been compromised. Plus, it is at a rank which is much
higher than many of the automobile manufacturing companies present in the market.
Style
The contours and curves of the automobile are stunning enough to make heads turn. No one
makes them better and more engaging than Nissan Sunny Car. This is especially true for the new
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model of the car. The cockpit is very stylish as well. The attractive orange illumination increases
visibility and appeal. It appeals to the young and the old, men and women alike.
Luxury
No doubt, the interior design of the car is impeccable. Each car seat is designed keeping in mind the
driver and passengers. Even for long and tiresome journeys, the drivers as well as the passengers do
Drive
The drive of the car is really very smooth. The advanced technology used in its shock absorbers lets
the car pass over small bumps, speed breakers and rough surfaces in such a smooth manner that the
entire experience remains unnoticed to the driver and passengers, where as while going over big
ones, you are glad that you are riding a Nissan Sunny.
Durability
Nissan Sunny is a very durable car. Like other established cars, this car brand passes through a series
of experimental tests such as the shocks test, resistance tests, air friction tests etc. in order to provide
Fuel Economy
Both the 1.3 liter and 1.6 liter of Nissan Sunny Cars contain QG engines which have been modified
to provide ample levels of mid-range torque for smooth acceleration and brisk response even at high
This is a very affordable car as compared to its competitors such as Toyota, Honda or Mitsubishi.
One of the plus points of this car is that it comes with a built-in CNG which mitigates the users’
efforts to install the CNG kit keeping in view the price difference between petrol and gas.
Weaknesses
Some of the weaknesses which have kept Nissan Sunny automobiles from being the best in the auto
Even if an individual does have the resources to own a Nissan Sunny automobile, keeping up with
the expenditure of its fuel consumption (Petrol) is an extremely arduous task. Even though the
engines are really economical in terms of fuel consumption but still the petrol is quite expensive.
This is mainly because the prices of petrol fluctuate a great deal, almost on a fortnightly basis. And it
is very rare that the price of petrol decreases. A slight decrease in the petrol price recently has still
kept petrol cars a dream for middle income group. So, a cheaper substitute of Petrol is Diesel as not
every customer uses CNG as fuel for the cars. Thus, an automobile with a diesel engine will prove to
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Poor Re-sale Value
The car has a poor re-sale value in Pakistan. Most of the people in Pakistan do not buy this car
keeping in mind its low re-sale value. This is in contrast to the high re-sale value of its competitors’
One of the major problems that the users of Nissan Sunny Car face is that the spare parts of this car
are rarely found. They are readily available at the Nissan Sunny dealerships i.e. only a few cities and
then again in a specific part of the city but are not available in other cities and towns. This makes the
customers reluctant to make their purchase decision of this car brand as they are not always willing
to get the parts from the dealerships which may be at some distance.
Ghandhara Nissan Ltd does not provide any facility of free car checkups or free replacement of
spare parts that Mitsubishi and other auto manufacturers provide in order to increase their market
share. Hence, Ghandhara Nissan Ltd. does not use the marketing gimmicks to their full use.
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Poor positioning
One of the major weaknesses of Ghandhara Nissan is that it has been unable to project the image of
its brand in the minds of its customers that it should have done in a much similar way to that in
Europe or America.
Opportunities
Ghandhara Nissan can also unveil a different showroom theme for its SUVs and X-Trail i.e., the
lines of outdoor adventurous experience. It can come up with the ambience and the atmosphere
which is of white water rafting that provides a perfect backdrop. Sound track and appropriate
lighting in the background can be utilized to enhance the realism of the outdoor theme.
Many dealerships in Europe are transforming their facilities into hybrid showrooms, offering
potential new Nissan fans the opportunity to see, test and purchase a full range of Nissan
automobiles. The idea is to give customers a feel for Nissan’s latest innovations, and a chance to
consider new recreational possibilities, such as buying an outboard engine to go with a sports utility
vehicle. This idea can and should also be implemented in Pakistan to successfully gain the first
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Customization & Customerization
A thorough analysis of the environment makes it clear that there is a lot of opportunity for Nissan
to go for new product introduction. The new product is not just supposed to be the launch of a
modified form of Nissan Sunny car with a bit different name and engine horse power, which may be
released in the market after customization or customerization. But it can be a totally different
product line. How can Nissan Ltd go for customization or customerization? Nissan Ltd could do it
so simply.
Customization: It is a process that is initiated by the company. In customization, Nissan Ltd can add a
personalized touch according to the order of a customer. For example, Nissan Ltd may come up
with a left hand or right hand drive according to the specifications defined by the customers.
Similarly it can come up with a bit more or less horse power engine than designated for the same
can go for customer feedback. Nissan Ltd can follow the policy of Toyota which asks children to
come up with their dream cars so that the company might be able to have options of stylish and
catchy models, which would be much liked and preferred by them because today’s children are
Nissan Ltd can customize and customerize its cars in a multitude of ways. For example,
It can come up with a three door model for younger boys and couples who have not yet started a
family.
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It can offer a more spacious five door and wagon model, designed with a family buyer in mind.
Those buyers have active life styles, which demand certain features in a car.
It can also come up with a four door model that provides extra cabin height and added leg room for
The company can come up with more fashionable and eye catching colors such as pepper red,
Similarly the company can come up with cars that have a built-in pleasing smell.
It can come up with more pleasing sounds that are more consciously designed by a team of specialist
acoustic engineers. These include the sounds of indicators, the door slam, the central locking and the
door release, the snap back of the door handle, the power windows, the release and closure of the
Threats
The allowance for the import of re-conditioned cars in Pakistan has caused a huge influx of re-
conditioned cars into the country. This has affected the sales of locally manufactured cars to some
extent. This import allowance has also affected the sale of Nissan Sunny car as people have more
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Volatile prices
Prices of automobiles can be volatile, meaning that prices of automobiles, in certain markets have, at
times, experienced sharp changes over short periods of time. This volatility might force further
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GROWTH-SHARE MATRIX
The growth-share matrix is a chart created by the Boston Consulting Group in 1970 to help
corporations analyze their business units or product lines, and decide where to allocate cash.
B.C.G. analysis is a technique used in brand marketing, product management, and strategic
management to help a company decide what products to add to its product portfolio. It involves
rating products according to their relative market share and market growth rate. The products are
then plotted on a two dimensional map. Products with high market share but low growth are
referred to as "cash cows". Products with high market share and high growth are referred to as
"stars". Products with low market share in a low growth market are referred to as "dogs" and should
usually be managed for value that is as much money should be harvested from those products with
low or no investments. Products with low market share but high market growth are referred to as
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If we talk about the prevailing situation of Nissan in the Pakistani market, Nissan Sunny can be
termed as the ‘cash cow’ for Ghandhara Nissan, as it accounts for the largest revenues for the
company. Cefiro, Tidda, X-Trail etc, offered by Ghandhara Nissan are not in demand in Pakistan.
The factors that are a necessary condition for success in a given market are called the key success
factors.
It is important to limit one’s list of Key Success Factors to two, or at most three. In creating a list of
‘things one has to be good at’, management teams frequently include five to eight activities.
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• Producing a low-cost product
• Managing expenses
For Ghandhara Nissan, there are two or three activities which are the primary determinants of
success. If its management team is good at those activities and just mediocre at everything else,
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PEST ANALYSIS
A PEST analysis is an analysis of the external macro-environment that affects all firms. Pest is an
acronym for Political, Economic, Social and Technological factors of the external macro-
environment.
Thus we can say that PEST Analysis is a framework that strategy consultants use to scan the external
macro-environment in which a firm operates. PEST factors play an important role in the value
Political Factors
High custom and excise duties can lower down the import of Nissan Sunny because of the increase
• Tax Policies.
• Employment Laws.
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Economic Factors
As per capita income increases, the purchasing power of the people residing in that country also
fosters, resulting in greater spending and saving. With the boom in economy, Pakistani Auto
Industry has shown growing figures in the form of large production volumes and larger sales. At the
same time, demand for imported cars has also increased. Some of the economic factors include;
• Government spending.
• Taxation.
• Exchange rates.
Social Factors
As customers are becoming more jazzy and trendy and their demand for innovative products is
constantly increasing, so Nissan should extend its product line in Pakistan and should come up with
more sleek and sporty models. This would increase demand for Nissan cars and would make the
• Income distribution.
• Lifestyle changes.
• Education.
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• Fashion/hypes.
Technological Factors
Nissan should constantly invest in R & D and should try to launch a fully equipped new model every
year in the market. If it stops innovation, it would lose the existing market share as well as its brand
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THE CUSTOMER ENVIRONMENT
Segmentation
The main reason why the companies segment is that there are so many types of customers.
The reason why Segmentation has become important in teaching and learning about marketing is
Segmentation is not easy, once you decide that it is necessary to do, you may find that it is
Things you have to think about in order to decide if a potential group is worthwhile being
considered a "segment”.
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Homogenous
The people in the proposed segment are all similar without too many differences.
Heterogeneous
Substantial
The people in the segment should be large enough in number to be worthwhile. The group has to be
large enough to generate sufficient sales volume at a low enough cost to result in a profit.
Competition
A company should target segments where the number of competitors and their size are such that the
Resources
A company should make sure that the segment relates to the resources of the company. If the
company can produce variations to fit its key demographics, great, but it should not take on
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Major Segmentation Variables for the firm’s current and potential
customer
• Demographic segmentation
it can be seen that they can be divided into the following demographic categories:
Income: Individuals having a monthly income of Rs.50, 000 can easily purchase Nissan Sunny
Car on lease whose monthly lease payments would be around Rs.20, 000 per month and the
rest of the amount can be allocated for personal consumption and utility bills etc. Hence,
Nissan Sunny Car targets people with income groups of around Rs.50, 000 and over.
Family size: Nissan sunny car is primarily designed as a four person car. Thus, families
ranging in size from 4 to 5 persons are and should be looking at Nissan Sunny as a good car
option.
Occupation: Nissan Sunny car has been modeled to meet the compatibility as well as usage
demands of a large variety of customers. This is the reason that Nissan Sunny car is used by
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• Geo-graphic segmentation
Nissan has not targeted any particular geographic segment for the launch of Nissan Sunny
Car. Neither has it targeted any particular city nor a metro size where it could place its
product. The car is widely available over almost all the major car markets of the world i.e.
• Psychographic segmentation
Social class: On a broader perspective, the key segments that Nissan Sunny Car caters in the
market consist of the lower middle class, middle class, upper middle class and the upper class
or the elite class. The lower middle class is usually interested in either second hand cars or
However, this market is further segmented into the consumer market and the capital market.
The consumer market consists of the individuals who buy the automobile for personal use
or for final consumption however capital market consists of the business firms,
governmental firms, banks and the private companies that use these cars for business
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• Product usage
The product i.e. Nissan Sunny car is a consumer product with heavy usage. The usage of the
car depends entirely upon the needs of the current as well as the potential customers.
The purchasers of the car can be divided into two categories i.e. capital goods buyers and consumer
goods buyers. The capital goods buyers would be the people who buy the car for further earning
revenue from it. An example could be the car rentals. The consumer goods buyers are the people
who buy the cars for personal use. An example could be a company executive.
Influencers
According to a research, children have a very strong influence on the buying behavior of their
parents. Secondly, the car is a good that involves high customer involvement and so the decision to
buy a new car generally involves input from the whole family. Thus, the family as well as friends,
environment, price considerations, re-sale value, after sales service etc. all play an important part in
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Purchase Locations
The product i.e. Nissan cars are sold at exclusive Nissan showrooms located in Lahore, Karachi,
Islamabad, Faisalabad and Multan. If the company wants to foster its sales as well as provide
convenience to the customers they must contemplate on opening up new showrooms in other major
As a result of the rapid influx of re-conditioned cars into the Pakistani market, the sales of Nissan
suffered a setback. But gradually they came back to the previous level, as customer awareness about
customers have to visit the company showrooms in order to purchase the car.
Purchase decisions
The decision of buying the car is need-based. But it also depends upon the affordability factor. Once
a customer has made up his/her mind to buy a car, the type as well as model of the car is selected
based on the affordability factor, apart from the involvement of several other factors such as luxury,
reliability, brand name, prior experience, re-sale value, after sales service etc. The decision to buy a
car is also dependant upon the recent price cuts as in the case of Nissan Sunny the sales increased
once the company reduced the prices. The promotion and positioning of the brand also influence
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The competitors’ strategies like price reduction etc. as well as environmental factors like increase in
petrol prices also influence the buying behavior. Another factor can be the future predictions about
the governmental policies e.g. tax/duty cuts on the import or production of vehicles. But these
Selection decision
The brand image is an important factor in the buyer decision making process. Apart from this, a
company has to differentiate itself from its competitors and to outperform its competitors the
company must constantly innovate and invest in R & D to come up with new products and at the
Nissan Sunny car is known for its quality and superior performance. It has a mid-torque engine
which provides fuel economy and gives better performance. The reductions in prices have brought
them at par with those of the competitors. Consequently, the customers are provided foreign
As far as the satisfaction levels of the customers are concerned, it is clearly elaborated by the
following table:
Build
Comfort
Depreciation
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Economy
Equipment
Handling
Insurance
Performance
Styling
Value
As already explained in the preceding pages that the customers in Pakistan are prospering
economically as well are getting more aware about environmental factors. As a result, the customers
in future would prefer cars that provide luxury while at the same time providing quality and fuel
economy. The cars should be environment-friendly as this as the concern for a greener environment
is constantly growing.
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Reasons for customers not buying the firm’s products
The primary reason for Nissan’s low sales is its inability to properly position itself in the customers
mind.
Apart from this, Nissan has the following problems due to which its competitors take the lead in
selling their product, better than that of Nissan. The major problems currently being faced by
Nissan has spare parts availability problem. The spare parts are available only at the Nissan
dealerships i.e. Lahore, Karachi, Islamabad, Rawalpindi, Faisalabad and Multan. The customers in
other major cities like Peshawar, Quetta, and Hyderabad etc. are a bit reluctant to buy the car
keeping in mind the non-availability of spare parts in the major regions. Even in the cities having
dealerships the spare parts are only available at the dealerships and not anywhere else. This is a cause
It is a fact that Nissan Sunny cars have poor re-sale value and the company has badly failed to
change the customer mind-set. This issue can only be dealt successfully if the customer mindset
regarding the overall performance is changed i.e. if they start to believe that the car is a durable
performer and can be used for longer periods of time. The customers understand that if they buy it
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they will incur a loss in a sense that when they want to change the car they will be given a price far
less than that they would get, had they bought some other car brand. But this problem will be solved
completely if the new Nissan Sunny cars are sold in such a quantity that they capture a significant
amount of the Pakistani auto-market. Only when the new Nissan cars are present in a significant
quantity in the market, then only will the second hand car market of Nissan flourish.
As customers have become more jazzy and trendy, and their demand for innovative products is
constantly increasing, so Nissan should extend its product line in the 1.3 liter and 1.6 liter category.
The other problem of diesel engine is that previously the company offered diesel engine but it didn’t
perform well so they stopped manufacturing it. Now since they are importing the car, they don’t
offer diesel engine which is the major draw back in their sales.
Moreover, they have limited dealership, they don’t have partnership with any banks and these cars
cannot be leased.
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MARKETING STRATEGIES
On the developing process of cars, the product initiative allows the company to be focused on the
market segments that are predicted to be developing in future. Nissan sees the upper-middle or
Successful traits among industry leaders are the formation of cross-functional development teams,
strong management support, and common platform architectures that maximize the sharing of
Market segmentation is a valuable tool that can be used to identify ways the development team can
implement and leverage a product platform. By utilizing the building blocks and core competencies
of the corporation, a platform leveraging strategy can be developed not only to exceed the demands
By applying the principles of market segmentation, firms can be developed successfully and have
innovative products at lower costs, while increasing revenue and profits for the company. Product
development is a key requirement for success in the 21st Century; companies that delay in adopting
these principles will be seriously disadvantaged in trying to grow in the global economy. Leveraging
the platform through the use of market segmentation is one way to get there.
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Target Marketing
Nissan Sunny is currently targeting the upper middle class and the elite class. However, it should
also target the middle class which is the most important and the biggest segment in the market. The
company is currently catering to the segment of 1.3L or 1300cc and 1.6L or 1600cc cars which is the
second biggest after 8L - 1.0L segment. Therefore, the company should also target this particular
segment of 0.8L - 1.0L as this segment is the biggest segment in the market, keeping in mind the
economic conditions and poverty levels in Pakistan. It is equally true that there is an intense
competition in this particular segment of the market but at the same time there are possibilities of
excelling as there is still capacity of new players in this segment of the market.
Since in the middle class segment, the competition is intense, the company needs to focus on the
development of their cars as the tastes of the customers are changing rapidly, they are slicing the
market into more focused pieces. In order to survive in the competition, Nissan Sunny models
should meet the requirements of the time and should also focus on long term R&D plans for
making catchy, more-compact, fuel-efficient cars. So differentiating the product is very important in
order to gain a competitive advantage which in turn helps in improving the market share of that
particular product.
While the elite class is a very important segment of the market and therefore Nissan Sunny should
not altogether neglect this segment. Therefore, it should focus on the R&D of the new models of its
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cars focusing on its better performance and quality. Since this particular segment is quality conscious
and not price conscious therefore, focusing on better performance and quality of the cars is very
important as the customers are even willing to pay for the improvement in the quality and
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MARKETING MIX
Product
Currently, the company is only manufacturing cars of 1.3L and 1.6L. Considering the current
economic scenario in Pakistan, small cars of 0.8L and 1.0L should also be introduced in the country
as they are more affordable in terms of price, fuel consumption as well as maintenance. In the auto
sector of Pakistan a large market for these small cars exists in comparison to large cars market.
Apart from this, the introduction of stylish and sleek shaped cars should be continued. The current
Nissan Sunny car fulfills these criteria in terms of being stylish, sleek and luxury looking one.
A few years back the company manufactured diesel cars which they have now stopped. The
manufacturing of diesel cars should be continued as there is a great demand for them. This will help
With regards to new product development in the next 10 years, Nissan should come up with hybrid
cars as has been done by Toyota and Honda. The hybrid cars are the new phenomenon in the
environment conscious world of the future. These cars are not harmful for the environment and so
would be much preferred by the environment conscious people, a class that is fast growing
throughout the world. Currently Nissan Sunny is coming up with QG engine technology. They
should search new avenues for the launch of V8 engine cars as they are more fuel efficient.
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Price
As a matter of fact, it is true that the company has already declined the prices of 1.3L and 1.6L
Nissan Sunny Cars. At this juncture, it seems that the company is not likely to change its price
strategy further but in the long run any rise or fall in the price range is expected depending upon the
But keeping in mind the prevailing situation at which the company is unable to meet it targeted sales
volume, the company should further reduce the prices in order to prompt the customers to prefer
this brand so that the sales of this particular car brand increase and it manages to capture its desired
market share.
As Ghandhara Nissan Ltd provides 100% imported Nissan Sunny Cars to its customers so it might
not be feasible for the company to reduce the prices further. But there is still one way out. If the
company starts local assembly of Nissan Sunny car, it can further reduce its price by a greater
margin. The prices would then become comparatively much lower, which would result in a boom in
its sales. Once it enters into the market saturation stage, then the company should go on increasing
the prices gradually and should charge a price comparable to its competitors (Honda and Toyota).
The price cut policy that the company has already adopted to boom its sales volume is given below.
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Model OLD Price (Rs.) NEW Price (Rs.)
Nissan Sunny 1.3L EXS M/T CNG Rs. 1,149,000/- Rs. 925,000/-
Nissan Sunny 1.6L EXS M/T CNG Rs. 1,315,000/- Rs. 1,055,000/-
Nissan Sunny 1.6L EXS A/T CNG Rs. 1,390,000/- Rs. 1,149,000/-
The above mentioned prices, in comparison with competitor cars of the same price range, are
nominal.
Placement
The company has dealerships in Lahore, Karachi, Islamabad, Faisalabad and Multan. Some major
cities like Peshawar, Rawalpindi, Hyderabad, Quetta etc. lack dealerships. The company must open
its 3S (Sales, Service, Spares) dealerships at these places to effectively sell its cars in these places.
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Apart from this, service shops or ‘Pit Shops’ must be opened at several places to offer effective and
professional services to the Nissan users. These Pit Shops should carry quality spares and must have
Promotions
Promotional tactics or in simpler terms the advertising strategy employed by Nissan is not of the
adequate level. For the last 3 to 4 months there have been no promotions for Nissan Sunny car. The
company management must take promotions seriously and promote their product on a massive
For promotions, several options can be used. The first and foremost that should be undertaken is
advertising. Advertisements should be carried out in newspapers, television and billboard. This is
Apart from this, “Free check-up and service” facility should also be provided once a year whereby
the owners of Nissan cars bring their cars and get free check-up and tuning by trained experts of the
company. Road shows for the new model should also be held in all the major cities of Pakistan so
that prospective buyers can check out the car, test drive it and get answer to any or all queries that
they may have. Such a promotional program would help promote the car among people and would
Currently the car has a very low sales volume. To increase the sales, massive promotions have to be
undertaken. For this, a considerable amount of budget should be set aside for promotions. As the
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sales volume is low, therefore, the promotions budget should not be linked to the sales volume
According to the company management, the Nissan car is much safer and much better
manufactured than its competitors. Therefore, the company should catch in on this safety aspect,
and should base its promotions on this “Safer than the rest” concept as safety is the competitive
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People
The behavior of the employees of any service or manufacturing firm plays a pivotal role in attracting
and retaining a loyal customer base. The sales staff of Nissan - available in show rooms - has a major
impact on the sales of Nissan Sunny car brand. With their positive interaction, accurate and
unbiased briefing and effective ‘moment of truth’ design, they can easily give critical incidents a
happy ending that can induce their customers to make repeat purchases as well.
Process
Simplicity in the process of service delivery, when mingled with superior quality, more value and
active after sales service, can lead to satisfied customers. This is what Nissan Sunny’s has been
successful in doing to some extent. Nissan Sunny follows a very simple and easy process in
delivering the product to its customers, mitigating any causes that could lead to a delay in the
delivery of the car. But still it has to travel a long way to change the perceptions of the Pakistani
consumers towards the performance of this car brand. It has yet to curtail the gap between the
expected and perceived performance of Nissan Sunny car in the minds of the customers.
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Physical evidence
• The car
Consumers can see Nissan Sunny car in the stylish silhouette that provides contemporary appeal
and the promise of satisfaction. They can sense it in the superlative engine and impressive
technologies that heighten the perception of quality. They can feel it in an interior that elegantly
Right at this juncture, the showrooms of Ghandhara Nissan have an ordinary outlook like its
competitors but it can opt for a competitive advantage if it cashes on new show room themes
that are being put into action in most of the developed countries. For example, Ghandhara
Nissan can unveil a different showroom theme for its SUVs and X-Trail i.e., the lines of outdoor
adventurous experience. It can come up with the ambience and the atmosphere which is of
white water rafting that provides a perfect backdrop. Sound track and appropriate lighting in the
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COMPETITOR
ANALYSIS
(MITSUBISHI)
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SWOT
Strengths
Quality
Quality is the core competency that they claim to have. In order to ensure quality management has
enough departments.
Quality Affairs
Office
All these activities are monitored under the head Safety Quality Auditor. In addition to these
departments, the company has few more departments as well in order to make sure they cope with
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the expectations of quality people have of them. The quality standards are in compliance with the
ISO 9002.
Patent rights:-
The company makes sure that any part it manufactures or imports from outside the country, is not
used by any other company. This also ensures that the quality standards are maintained.
The company is very receptive with regards to feed back from customers. The Senior General
Manager, Dewan Farooqi motors brought this to notice that a lot of customers had reservations
about the seating of the car that it was not comfortable. They told the manufacturers about this
particular feed back from the customers who in turn improved the seating of all the available unsold
products. Also they recalled their sold products and did the desired renewal. Another issue was with
the availability of limited colors of their products. This feed back lead to an all together new range of
colors. Thus over all the company is very reactive to customer feed backs.
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Weaknesses
They have a very low profit margin for Lancer since it is imported from Japan and is not available
locally; therefore it has not yet captured a broader market segment. It only serves to specific
customers
Another issue is of the availability of spare parts. Since the government has posed a 5% tax on the
import of spare parts and secondly as mentioned earlier that this brand is imported so locally they
don’t have spare parts available. And the spare parts also have to be imported from Japan (since it is
Japan assembled). This is very costly from the firm’s point of view.
DMMC is the sole company to which Mitsubishi has handed over its dealership. The local dealer
offices do not add up to a good number. It has 1 dealer in Rawalpindi, 2 in Islamabad, 3 in Lahore, 1
Because of the weak distribution network and the issue with spare parts availability, it has a low
resale value.
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OPPURTUNITIES
Right now they are doing exclusive dealership, only with DMMC. No doubt this is necessary for
building a brand image but in the long run it can be a hindrance for the sales of the company. So
they should make contracts with local dealers as well. This will ensure that their product is available
for masses. So this is a potential area for them and it will have a direct impact on their sales.
Impact of WTO
The speculation that in 2008, WTO will uplift the import duty on cars will prove to be a great
opportunity. Also the tax on spare parts will be significantly reduced or eliminated. This will be great
opportunity for Mitsubishi to cash on because right now there profits are getting affected and the
main reason is attributable to the fact that it is subject to import duty and taxation.
According to our consumer survey figures, more than 60% of the people preferred Mitsubishi over
other companies for its style and appearance. So this is an other area where it can capitalize. It
should keep its main focus on such customers and position it self as a leader in style.
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Hybrid Showrooms: A New Sales Approach
Many dealerships in Europe are transforming their facilities into hybrid showrooms, offering
potential new Nissan fans the opportunity to see, test and purchase a full range of Nissan
automobiles. The idea is to give customers a feel for Nissan’s latest innovations, and a chance to
consider new recreational possibilities, such as buying an outboard engine to go with a sports utility
vehicle. This idea can and should also be implemented in Pakistan to successfully gain the first
Threats:-
The allowance for the import of re-conditioned cars in Pakistan has caused a huge invasion of re-
conditioned cars into the country. Like Nissan Sunny, this has impacted the sales the sales of locally
Volatile prices
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Competition
In the current scenario many companies have entered the market; therefore intense competition is
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FORMAL MARKETING CONTROL
Employees of Mitsubishi are recruited and selected at the distribution outlet i.e. the showroom.
DMMC selects a group of employees that are finally hired after the interview. The minimum
requirement for hiring an employee with respect to educational background is F.A. The number of
employees (sales force) is allocated to each city according to the demand of the product in that
particular city.
Employees are evaluated on the basis of performance, number of sales and customer services.
Employee compensation includes golden handshake. Major authority of decision making lies with
DMMC and the employees due to the nature of the job are provided limited authority. Means of
Management has not invested in promotional activities as such and that is the reason there is no
aggressive marketing campaigns carried out by Mitsubishi. Management of Mitsubishi thinks that
employees are their important assets and therefore to keep the motivational level of the employees
high they take and try to implement their feedback. Further DMMC also implement job rotation in
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Output control mechanisms
There are various product standards that are being used by Mitsubishi i.e. .ISO 9001.9002 and 2004.
The cars of Mitsubishi are Japanese assembled, which maintains its credibility in the market. But in
case if there is a gap identified in the actual and perceived product Mitsubishi offers replacement of
the product. Similarly it also has certain price performance standards. The pricing strategy of
Mitsubishi is competition based. Mitsubishi offers distribution at its own outlets and is therefore the
sole distributor of its cars. Mitsubishi has not defined any standards for IMC, as it does not carry out
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TARGET MARKET
Target market
Customers purchasing choice depend upon their need fulfillment. The foremost need of upper
middle class and higher earning class i.e. the target market of Mitsubishi is to get luxury, quality and
style at an affordable price. Luxury in terms of interior as the interior is imported and is according to
the demand of the upcoming generation and above all they also provide warranty for the interior.
Mitsubishi also caters to the safety needs of the target market by providing crash tools test, air bags
and specially designed seat cushions. Customer requires smooth driving whether going for a long
drive or just a few miles away. They also want to experience high quality and therefore to come up
to their level Mitsubishi follows customer centricity that al the more fulfills the need of satisfaction.
Further more the company also ensures fuel economy that satiates the financial needs of customers.
Hence the target market of Mitsubishi can be segmented on the basis of demographic and
psychographic variables.
Demographic segmentation
Income
The target market can be segmented on the income basis as the segment preferring this car is upper
middle class and high earning income individual who want to get a bulk of benefits within an
affordable price.
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Psycho graphic segmentation
Social class
Due to the brand name attached to Mitsubishi, the target market takes pride in purchasing
Although people like to purchase Nissan also but when preference is to be made then most of the
people go for Mitsubishi because of the better brand image and the social image. This can also be
seen by the results of the survey conducted that almost 70% people like and prefer Mitsubishi
because of its better brand image. One factor that negatively influences the purchase of Mitsubishi is
the non-availability of its spare parts. And the factor that positively impact the purchase of
Mitsubishi is its highly competitive pricing i.e. 9 lakh whereas for Toyota 12 lakh
The reason that can lead to dispositioning of Mitsubishi can be its contract of providing Mitsubishi
lancer to radio cab services. As people develop perceptions so they would start perceiving it as a
radio cab rather a car that can be purchased for personal purposes.
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MARKETING MIX
Product
Product for Mitsubishi includes Mitsubishi lancer, eclipse, gallant, pajero. The features of the car
includes
One of its own style shapes that suits the demand and choice of the consumer.
High quality warranted interior especially designed to maintain comfort level for the consumer.
Crash tools test, airbags and specially designed cushions for comfort and safety of the consumers
The SCA of Mitsubishi is its competitive pricing and its warranty period both in terms of miles and
months that ensures the durability of the car. It gives warranty of 60 months whereas the
competitors give warranty for 36 months only. Similarly it promises car life in terms of completion
The feature that differentiates Mitsubishi from that of competitors is its engine power desired by the
customers in a competitive price. The company is quite customer centric as it imports spare parts on
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Pricing
Price is a ‘p’ that can be used to recover costs and gain profits on each car sold. The prices charged
by Mitsubishi are highly competitive when compared to Nisaan, Toyota and Honda. The price of
Mitsubishi lancer is 9 Lac and that of Nissan, Toyota and Honda is above 12 lac.
The objective behind this competitive is that the company is well aware of the fact that Toyota and
Honda is preferred over Mitsubishi in Pakistani market. One of the reasons is brand image and the
other is its resale value that is not that high. The company offers 10% down payment on purchase of
Placement
The distribution of the cars takes place from the outlets or showrooms located at various cities of
Pakistan. The cars are assembled at the DMMC and are then distributed to the showrooms
according to the demand of the customers. The showrooms of Mitsubishi in Pakistan are located
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Promotion
This is the area where Mitsubishi lacks as it carries out no promotional campaigns. By the help
of promotions they can highlight the strengths of the company and in turn improve the market
share. Mitsubishi needs to develop a coherent IMC in order to prioritize its products.
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SCENARIOS
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SCENARIO 1
Situation
Our first proposed scenario is the abolition of import and custom duty on cars by the government
of Pakistan. In the current global scenario, trade related policies are being amended to ensure free
and fair trade. The World Trade Organization (WTO) related regulations is an example of this. All
over the world, import duties, subsidies and trade related tariffs are being abolished to achieve the
afore-mentioned objectives.
Once the government of Pakistan decides to implement these policies in the country, import duties
would have to be abolished. This would cause a huge influx of imported cars into Pakistan resulting
in much cheaper car prices as compared to today. There would be a plethora of foreign made cars
for the customers to choose from. Coming from foreign countries and facing severe competition,
the cars would be of a much better quality than those manufactured in Pakistan.
If the above mentioned situation arises, the competition in the automobile industry of Pakistan
would increase greatly. Every car manufacturer would have to competitively price its products while
at the same time, provide better quality. With respect to Nissan, the company would have to make
sure that it not only formulates a sustainable competitive advantage but also effectively communicate
it to the customers. The sales of Nissan can be severely affected as the customers would have much
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more options to choose from. Even the most loyal Nissan customers would be lured to switch their
car brands.
Strategy
Thus, it would become absolutely necessary for Nissan to formulate a competitive marketing
strategy and communicate its market presence all over the country. Other aspects like after-sales
service, free annual checkups, greater dealer coverage etc. would also have to be taken into account
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SCENARIO 2
Situation
If Ghandhara Nissan starts local assembly of its car brands, the company may have a competitive
advantage in the sense that it can offer the same cars at more affordable prices. In such a case it
would have to use almost 65% of locally manufactured parts (Pakistani government requirement for
locally manufactured cars). This would lead to quality issues, as Pakistani manufactured parts are of
comparatively lower quality. At the same time, the company’s competitive edge of providing high
quality imported vehicles would be compromised. Lower quality and reliability would bring
Strategy
In the above mentioned eventuality, the company would have to make sure that it upholds its high
quality standards and provides reliability to the customers. The company should make sure that it
uses high quality parts in the manufacturing process. At the same time, in order to compete with
competitors, the management would have to contemplate on improving its marketing and
promotion strategy.
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RECOMMENDATIONS
119
Recommendations
The Company should continuously invest in R & D and should focus on TQM. It must show
customer focus and flexibility in order to fulfill their changing needs and demands. Before launching
a new product, Nissan should go for a thorough market survey and customer feedback as well. If the
results come in some what favor of what the company is already planning about, it should go for the
Through Perceptual Mapping, Ghandhara Nissan can locate the relationship between price and
quality of any new model that it wants to launch in the market. Through Value Mapping, it can
inquire about the value demanded by customers at a specified price. Having done with that, it should
also start advertising through the newspaper, radio, television and newspaper but should not ignore
The company should also apply the concept of Smashing the Brand in which it should try to place
its brand in the minds of customers using all the five senses. If the company wants to know about
several factors through which it can further improve it performance in the market, it should opt for
Personification i.e., it can think of itself as a car brand and can determine ways and means of how
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It should also start sponsoring public events and other such events like sports in order to get the eye
of the viewer who could be their tomorrow’s customer. It should also use opinion leaders and
celebrity endorsements to advertise its new product line. The company should also offer ‘test drive’
option to its customers so that they pass through a cozy experience of that new product line, which
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APPENDICES
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QUESTIONNAIRE (company)
1. What kind of promotional techniques is the company using for its product, Nissan Sunny
2. What is the “key idea” or “catch phrase” that the company promotes while marketing the
car?
5. What is the market share of Nissan Sunny car in the local auto market?
7. What are the strengths and weaknesses of the product as compared to other products
8. Discuss and recommend if the current price policy should be maintained or dropped?
9. In the present day environment what are the environmental trends, opportunities and threats
11. What are the short-term, long-term plans being pursued regarding the sale of the car?
12. What are the major factors hindering the sale of the product in our country?
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13. Which weakness of the competitors do you think you can convert into opportunities for
yourself?
15. For selling Nissan Sunny, how do you think you can bank on the popularity of the Nissan
16. Did the strategy of any one of your competitors compel you to formulate a new strategy?
17. How and what is the process through which you conduct customer feedback? How are the
18. What additional products does the company plan to launch in the next 10 years?
20. What are the future trends that your company perceives as being vital for the auto industry?
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QUESTIONNAIRE (car users)
1. Do you own a car? If yes, which price category is your car placed in?
(A) Rs.200, 000 - Rs.499, 000 (B) Rs.500, 000 - Rs.799, 000
(C) Rs.800, 000 – Rs.1, 499,000 (D) Rs.1, 500, 000 – And Above
2. What is the first thing that you look for, before buying a car?
(A) Price (B) Car Brand
3. When you have selected a car, what do you look for in a car?
(A) Performance (B) Exterior
4. How did you know about the car that you currently own?
(A) Previous experience (B) Word of mouth
(C) Advertisements
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5. Did you consider buying Nissan Sunny car before buying the car you own?
(A) Yes (B) No
7. If yes, what positive aspects did you find in the Nissan car?
(A) Price (B) Car Brand
9. Do you think their marketing strategy is efficient enough to make this car
popular among the car users?
(A) Yes (B) No
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(C) Undecided
10. If you think that the marketing strategy is not efficient enough, suggest any
measures for improvement?
________________________________________________________________
________________________________________________________________
_________________________________________________
11. How often do you come across the advertisements of this car?
(A) Never (B) Scarcely
13. Where does this brand stand in your preference in the cars that are currently
available in the market?
(A) Primary choice (B) Secondary choice
14. What measures do you suggest for improving the sale of the car in Pakistan?
_______________________________________________________________
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A GLANCE AT CUSTOMER SURVEY ABOUT
Q: How did you know about the car that you currently own?
previous experience
wordof mouth
advertisements
any others
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Q: How often do you come across the advertisements of Nissan Sunny car?
never
scarcely
often
cant remember
price
car brand
performance
spare part availability
exterior
interior
any other
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Q: What were the negative aspects of Nissan Sunny car?
price
car brand
performance
spare part availability
exterior
interior
any others
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REFERENCES
• Bashir Ahmed Abbasi, Dy. General Manager(North), Ghandhara Nissan Ltd., 400/2,
• Nauman M. Khan, Manager Marketing & Sales, Ghandhara Nissan Ltd., Ghandhara House,
• Email: nouman_mktg@ghandhara.com.pk
• Mr. Shahid Ikram, Senior General Manager, Corporate Affairs, Dewan Mushtaq Group, 58
• http://www.gnl.com.pk
• http://en.wikipedia.org/wiki/Competitor_analysis
• http://en.wikipedia.org/wiki/Industrial_market_segmentation#Targeting_and_Positioning
• http://www.termpapergenie.com/bmw.html
• http://www.springerlink.com/content/q44vn41w48678431/
• http://www.marketap.com/Segmentation.htm
• http://www.findarticles.com/p/articles/mi_m3165/is_n11_v24/ai_6829818
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• http://www.findarticles.com/p/articles/mi_m3165/is_12_39/ai_11126701
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