20% while bajaj Auto growth is only 5.39 %.
2. Hero MotoCorp is increasing its production capacity to 10 million
while Honda is emerging in a very big way and it is doubling its
production capacity to 4 million within a year. Suzuki is also
doubling its production capacity and Yamaha is on a verge of tripling
its production capacity.
3. On an export front, Hero MotoCorp has set up 1.2 lacs/month
production capacity plant in Sanand (Gujarat project near Ahmedabad)
dedicated 100% export and Honda, through its China plant has
introduced its new variant (pricing 31,000 INR) in Nigerian and South
African market (Nigeria and South Africa contribute 50% export sales
of Bajaj Auto). Hero MotoCorp has initiated its distribution network
in all the 11 countries where Bajaj is exporting.
4. Italian based Piaggio is also penetrating in the two-wheeler
segments with attractive variations of bikes by January 2012.
5. In three-wheeler segment, Piaggio is increasing its capacity to
40000 units / month while TVS is tripling its capacity to 8000 units /
6. With Government withdrawing DEPB (Duty Entitlement Passbook Scheme)
benefit scheme for exporters, Bajaj auto will face severe problems in
terms of their fall in export profit margin.
7. For the next two years in the domestic market, Two-Wheelers segment
average growth may be 8% to 10% as compared to previous two years
where average growth has been 20%.
8. According to market research performed on consumers the most
preferred brand of two-wheelers is Honda which will replace Bajaj's
2nd position by January 2012 & by April -12, bajaj will downgrade to
4th position giving its way to TVS in Indian market.
9. Recent increased Input costs following the spurt in steel, rubber
and aluminum prices, will result in very high operating margin
pressure for bajaj auto.
10. To maintain the profit margin, Bajaj Auto is compromising on its
quality and neglecting the marketing promotion strategy.
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