Name: Amol .S.

Mane
Class: SY BMS
Div : A
R.N : 10
Sub : Strategic Management
Topic : Automobile Sector (Tata Motors and Maruti Suzuki)
SWOT ANALYSIS
Maruti Suzuki
HISTORY:
Maruti Udyog Limited which is now known as Maruti Suzuki India Limited is
a 37-year-old conglomerate that has fulfilled the lives and needs of Indian
citizens in terms of their automobiles. It is a 56.21% owned subsidiary of the
Japanese automobile company Suzuki Motor Corporation.
It is the largest car manufacturer company in India. The Company recorded the
highest ever market share of 58% as of July 2018 in the Indian automobile
market making it the most popular and revered brand in the country and around
the world. Some of its popular cars are Ciaz, Ertiga, Wagon R, Alto, Swift,
Celerio, Swift Dzire, Baleno, Alto 800, etc.
Maruti Udyog Limited was founded by the Government of India on 24
February 1981 with Suzuki Motor Corporation as a minor partner, only to
become the formal JV partner and license holder of Suzuki in October
1982.The first manufacturing factory of Maruti was established in Gurugram,
Haryana, in the same year.
Tata Motors:
• Tata Motors was founded in 1945 and started its operations as a manufacturer of
locomotives. After 9 years in 1954, In collaboration with Daimler-Benz AG, manufactures
its first commercial vehicle in history; its partnership with Daimler-Benz AG was ended
in 1969.
• In 1988, Tata Motors started the manufacturing of passenger vehicles, with the launch of
the model Tata Mobile and after that Tata Sierra in 1991, and become the first Indian
automobile company to manufacture a fully indigenous automobile.
• Tata Motors Limited was formerly known as Tata Engineering and Locomotive
Company(Telco). It is among the top multinational Automotive company, which is
manufacturing personal, commercial, and military vehicles. Its headquarter is situated in
Mumbai, India.
• In the Financial year, 2017-2018 its market share was closer to 44% in the Indian
domestic commercial vehicles. In the passenger vehicle sales, its share was 6.39%. It’s
among the top 5 passenger vehicle manufacturers by share.
 The Tata Group was founded as a private trading firm in 1868 by entrepreneur
 and philanthropist Jamsetji Nusserwanji Tata. In 1902 the group incorporated
the Indian Hotels Company to commission the Taj Mahal Palace & Tower, the
first luxury hotel in India, which opened the following year. After Jamsetji’s
death in 1904, his son Sir Dorab Tata took over as chair of the Tata Group.
Under Dorab’s leadership the group quickly diversified, venturing into a vast
array of new industries, including steel (1907), electricity (1910), education
(1911), consumer goods (1917), and aviation (1932).
SWOT ANALYSIS:
Strength:
TATA MOTORS: Maruti Suzuki
•Large and diversified product portfolio: Tata’s • Maruti Suzuki is India’s largest passenger
product portfolio is broad and well-diversified. car manufacturer with a market share of
The well-diversified automobile portfolio helps around 45 percent.
them bring revenue and income stabilization.
This stability develops confidence for the • 12Maruti has an employee base of more
investors in Tata Motors. than 12,000.
•Brand recognition: TATA is a well-known • Effective ads, a product range, products
brand in the country of origin and in that compete for themselves.
neighboring countries such as Bangladesh,
Pakistan, etc. • Largest dealer sales network and service
•Stable Earning: Stabilized profit has been centers.
earned. Tata has a strong method of governing. • High brand awareness and a good
Tata Motors acquire those companies which are
similar in the management structure. They only
presence in the market for second-hand
follow this policy, as they have confidence in vehicles.
their policy objectives of management. • Getting various income sources that push
•Large employee base: it employs a large schools like Maruti Finance, Maruti
number of people. More than 82,797 workers Insurance, and Maruti. Parts are cheap as
work under Tata Motors. compared to other cars.
Weakness:
TATA MOTORS: Maruti Suzuki:
• Global presence: The global car market is • Weak interior quality in cars compared to
growing at a rapid pace. If it’s limited to a high-quality players such as Hyundai and
particular area, then it’s a strong barrier to other recent foreign players such as
growth as other international companies can Volkswagen, Kia etc.
enter the very same sector. In achieving global • Intervention by the Government because it has
market shares Tata remained silent. Until now a share in Maruti Suzuki.
it has not penetrated into other foreign
markets. • Younger generations began to have a big
affinity for new foreign brands.
• Ineffective Marketing strategy: a firm’s power
lies in a solid marketing strategy. It’s the way a • The management and the labor unions of the
firm can know their customer’s demands and company are not in good terms. The
produce the products accordingly. This also employees’ recent strikes have slowed down
helps to connect with customers and educate production and, in turn, have impacted sales.
them about the value they expect to offer.  The • As with other players, Maruti hasn’t proved
TATA lacks a clear marketing strategy for himself in the SUV segment.
promoting its company worldwide.
• Inability to penetrate into the world market.
Opportunities:
TATA MOTORS: Maruti Suzuki:
• Strategic Positioning: For creating a • Maruti Suzuki introduced their LPG version of
positive brand identity company must Wagon R and at the same time, it as a positive
have a clear marketing strategy. It can also move.
allow developing a good client base in • Maruti Suzuki will conduct R&D on electric
India and around the world. For reaching cars for a much better fuel replacement.
new markets and position itself TATA • Maruti’s cars have immense potential in
Motors must follow an aggressive tapping into the middle-class segment and
marketing and promotional strategy. serving as a big challenge to Nano.
• Merger and Acquisition Opportunities: • Maruti ‘s Latest DZire will grab the market
Merger and acquisition is a fairly common share and are expected to build the same magic
tradition in the automotive sector. Tata has as Maruti Esteem (not currently available).
a long track record as one of India’s oldest • The company’s production potential brings
companies. As it grew larger, it has fresh expectations in both the American and
acquired acquisition capabilities.  It also British markets.
has its own proven management policies • For Maruti Suzuki, it can be an opportunity to
which may help manage newly acquired build electric cars and fuel-efficient cars for the
businesses. future.
Threats:
TATA MOTORS: Maruti Suzuki:
•Fuel price: Fuel prices influence vehicle sales • Maruti Suzuki recently experienced a fall in
not only in India but worldwide as well. The fuel market share due to the increasing demand for
price and car sales are directly related. So if the cars of foreign players.
price of the product increases, the sales volume • Major players like Maruti Suzuki, Hyundai, Tata
will decrease. This is the biggest threat for the lost their market share due to lots of small
car manufacturing company like TATA Motors players like Volkswagen- polo. Because of its
•Government Environmental Law: Many Figo, Ford has demonstrated a substantial
countries develop carbon emissions laws. If increase in market share.
India introduces this kind of law, TATA may • China will compete well as they intend to join
need to produce more carbon-efficient cars that the Indian car market as well.
may need additional investment.
• Government policies around the world for the
•Industry pressure: There’s so much rivalry in the car market.
car industry. Such companies also sell newly
designed cars that have fuel efficiency, updated • Much higher fuel costs.
models, technology, and eco-friendliness. In this • Maruti Suzuki ‘s business can be hurt by intense
sector, TATA has many strong competitors. So, competition from global automotive brands and
it’s got to be vigilant to become more successful. cheaper marks.
•Tata Motors is facing stiff competition with the • Replace public transit modes such as taxis,
players in the Car Market. Tata Motors Limited, subway trains, etc.
therefore, has to concentrate on both quality and • Economy recession and demonetization
lean manufacturing. expenses.
COMPARISON:
• When it comes to the automobile industry in India, two names hold undisputed presence
Maruti Suzuki and Tata Motors. Both the brands over the years have redefined the
industry and are synonym with quality and performance in Indian context. A critical
reason for the success is the focus on affordability and the strategy to ensure ease to
purchase the cars. In Central India, both the companies are striving for supremacy and at
the same time are trying their best to ensure the ease by which the consumer is able to
purchase the car. Hence it becomes very important to understand the consumer preference
with respect to both the brands in a market, considered very important by the industry in
general. The study was conducted using a questionnaire based on 7 factors obtained with
the help of secondary sources, which included- price of the car, fuel efficiency of the car,
maintenance of the car, after sales services provided by the company, financial services
offered by the company for purchase, performance of the car and resale value of the car.
The main advantage with the following study will be the fact that both the companies can
ultimately enhance consumer preference parameters towards their own respective brand.