FIELD STUDY REPORT

On
“Marketing Strategy on Honda Automobile”

Towards partial fulfillment of

Bachelor Of Business Administration (B.B.A.)
School of Management Babu Banarasi Das University, Lucknow

Guided by Submitted By
Mrs. Shachi Kacker Arshan Aziz
BBA II Year IIIrd Sem.
Univ. Roll No. 1180671094

Session 2019-20
School of Management

Babu Banarasi Das University

Lucknow
1
 DECLARATION

This is to declare that I Arshan Aziz of BBA have personally worked on the project entitled
“MARKETING STRATEGY ON HONDA AUTOMOBILE” The data mentioned in this report were
obtained during genuine work done and collected by me. The data obtained from other sources have been
duly acknowledged. The result embodied in this project has not been submitted to any other University or
Institute for the award of any degree.

Date: `
Place: Lucknow

Arshan Aziz
BBA II Year IIIrd Sem.
Univ. Roll No. 1180671094

2
 ACKNOWLEDGMENT
First of all I thank God for giving me this wonderful opportunity to undertake this research which is a
part of my BBA program.
I would like to sincerely thank Mrs. Shachi Kacker giving me the wonderful opportunity to work under
her able guidance and support throughout my research.
I also thank persons working at Amul office for giving me their valuable time and vital information
which forms a part of this report.
I would also like to thank my colleagues for rendering their help to me in this research.
Last but not the least, I thank my parents for their prayers, help and advice which helped me a lot to
complete this project report.

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 Executive Summary

Honda Motor Co., Ltd., together with its subsidiaries, engages in the development, manufacture,

and distribution of motorcycles, automobiles, and power products primarily in North America,

Europe, and Asia. Its motorcycle line consists of business and commuter models, as well as

sports models, including trial and motor-cross racing; all terrain vehicles; personal watercrafts;

and multi utility vehicles. The company also produces various automobile products, including

passenger cars, minivans, multi-wagons, sport utility vehicles, and mini cars; and power products

comprising tillers, portable generators, general-purpose engines, grass cutters, outboard marine

engines, water pumps, snow throwers, power carriers, power sprayers, lawn mowers and lawn

tractors, home-use cogeneration units, thin film solar cells home use, and public and industrial

uses. In addition, it sells spare parts and provides after sales services are through retail dealers, as

well as involves in retail lending, leasing to customers, and other financial services, such as

wholesale financing to dealers. The company was founded in 1946 and is based in Tokyo, Japan

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 CONTENTS

1. Introduction

2. Company Profile

3. Importance & Scope

4. Research Objectives

5. Hypothesis

6. Research Methodology

7. Data Analysis

8. Findings

9. Suggestions

10. Limitations

11. Bibliography

12. Annexure

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 INTRODUCTION

Honda has been the world's largest motorcycle manufacturer since 1959, as well as the world's

largest manufacturer of internal combustion engines measured by volume, producing more than

14 million internal combustion engines each year. Honda surpassedNissan in 2001 to become the

second-largest Japanese automobile manufacturer. As of August 2008, Honda

surpassed Chrysler as the fourth largest automobile manufacturer in the United States. Honda is

the sixth largest automobile manufacturer in the world.

Honda was the first Japanese automobile manufacturer to release a dedicated luxury

brand, Acura, in 1986. Aside from their core automobile and motorcycle businesses, Honda also

manufactures garden equipment, marine engines, personal watercraft and power generators,

amongst others. Since 1986, Honda has been involved with artificial intelligence/robotics

research and released their ASIM Orobot in 2000. They have also ventured into aerospace with

the establishment of GE Honda Aero Engines in 2004 and the Honda HA-420 HondaJet,

scheduled to be released in 2011. Honda spends about 5% of its revenues into R&D.

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 COMPANY PROFILE

History of Honda

From a young age, Honda's founder, Soichiro Honda (本田 宗一郎, Honda Sōichirō) had a great

interest in automobiles. He worked as a mechanic at a Japanese tuning shop, Art Shokai, where

he tuned cars and entered them in races. A self-taught engineer, he later worked on a piston

design which he hoped to sell to Toyota. The first drafts of his design were rejected, and Soichiro

worked painstakingly to perfect the design, even going back to school and pawning his wife's

jewelry for collateral. Eventually, he won a contract with Toyota and built a factory to construct

pistons for them, which was destroyed in an earthquake. Due to a gasoline shortage

during World War II, Honda was unable to use his car, and his novel idea of attaching a small

engine to his bicycle attracted much curiosity. He then established the Honda Technical Research

Institute in Hamamatsu, Japan, to develop and produce small 2-cycle motorbike engines. Calling

upon 18,000 bicycle shop owners across Japan to take part in revitalizing a nation torn apart by

war, Soichiro received enough capital to engineer his first motorcycle, the Honda Cub. This

marked the beginning of Honda Motor Company, which would grow a short time later to be the

world's largest manufacturer of motorcycles by 1964.

The first production automobile from Honda was the T360 mini pick-up truck, which went on

sale in August 1963.[10] Powered by a small 356 cc straight-4 gasoline engine, it was classified

under the cheaper Kei car tax bracket.[citation needed] The first production car from Honda was

the S500 sports car, which followed the T360 into production in October 1963. Its chain driven

rear wheels point to Honda's motorcycle origins.

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Company Name

Honda Motor Co., Ltd.

Head Office

1-1, 2-chome, Minami-Aoyama, Minato-ku, Tokyo 107-8556, Japan Tel: +81-(0)3-3423-1111

Established

September 24, 1948

President & CEO

Takanobu Ito

Capital

¥86 billion (as of March 31, 2010)

Sales (Results of fiscal 2010) Consolidated: ¥8,579,174 million Unconsolidated: ¥2,717,736 million

Total number of employees

Consolidated: 176,815 (as of March 31, 2010)

Unconsolidated: 26,121 (as of March 31, 2010)

Consolidated subsidiaries

390 subsidiaries (as of March 31, 2010)

Chief Products

Motorcycles, automobiles, power products

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CORPORATE PROFILE

Honda Motor Co., Ltd. operates under the basic principles of "Respect for the Individual" and "The Three Joys" —

commonly expressed as The Joy of Buying, The Joy of Selling and The Joy of Creating. "Respect for the Individual"

reflects our desire to respect the unique character and ability of each individual person, trusting each other as equal

partners in order to do our best in every situation. Based on this, "The Three Joys" expresses our belief and desire

that each person working in, or coming into contact with our company, directly or through or products, should share

a sense of joy through that experience. In line with these basic principles, since its establishment in 1948, Honda has

remained on the leading edge by creating new value and providing products of the highest quality at a reasonable

price, for worldwide customer satisfaction. In addition, the Company has conducted its activities with a commitment

to protecting the environment and enhancing safety in a mobile society.

The Company has grown to become the world's largest motorcycle manufacturer and one of the leading automakers.

With a global network of 492* subsidiaries and affiliates accounted for under the equity method, Honda develops,

manufactures and markets a wide variety of products, ranging from small general-purpose engines and scooters to

specialty sports cars, to earn the Company an outstanding reputation from customers worldwide.

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Honda In India

Honda Siel Cars India Ltd., (HSCI) was incorporated in December 1995 as a joint venture

between Honda Motor Co. Ltd., Japan and Siel Limited, a Siddharth Shriram Group company,

with a commitment to providing Honda’s latest passenger car models and technologies, to the

Indian customers. The total investment made by the company in India till date is Rs 1620 crores

in Greater Noida plant and Rs 784 crores in Tapukara plant.

HSCI’s first state-of-the-art manufacturing unit was set up at Greater Noida, U.P in 1997. The

green-field project is spread across 150 acres of land (over 6,00,000 sq. m.).

The annual capacity of this facility is 100,000 units. The company’s second manufacturing

facility is in Tapukara, Rajasthan. This facility is spread over 600 acres and will have an initial

production capacity of 60,000 units per annum, with an investment of about Rs 1,000 crore. The

first phase of this facility was inaugurated in September 2008.

The company’s product range includes Honda Jazz, Honda City, Honda Civic and Honda Accord

which are produced at the Greater Noida facility with an indigenization level of 77%, 76%, 74%

and 28% respectively. The CR-V is imported from Japan as Completely Built Units. Honda’s

models are strongly associated with advanced design and technology, apart from its established

qualities of durability, reliability and fuel-efficiency.

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World Wide Message By Honda

Striving to become a company that society wants to exist by strengthening the core

principles of Honda

Looking back over the past fiscal year

Last year brought positive signs of economic recovery, including increased consumer spending

in Japan and the U.S. and expected economic expansion in Asia and developing nations. At the

same time, concerns about the economic downturn, credit crunch, and unemployment persisted

in the U.S. and Europe. Moreover, regardless of regional differences, there was new movement

to drastically reduce greenhouse gas emissions, primarily CO2. In these ways, 2009 showed that

further management effort and environmental action were required in the near future. Under such

circumstances, Honda responded swiftly and specifically to the needs of society and customers in

each region. Through research and development, we worked vigorously to produce advanced

technologies for safety and environmental requirements. Through production, we addressed

changes in regional needs in a flexible manner, establishing a “mutually complementary” system

of manufacturing parts and finished vehicles in each region. Through sales, we released products

with new value by enhancing eco-responsible vehicles and widened the range of our product

lineup. As a result, over the last year alone, we delivered motorcycles, automobiles, and general-

purpose products to a total of more than 23 million customers around the world.

Striving to become a company that society wants to exist

Due to global political and economic changes, the business environment surround- ing Honda

remains uncertain amid growing social concern about environmental challenges. However, no

matter how considerable these changes may be, Honda will win the trust of our customers and

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appeal to customers as before by creating technologies and products with new value that

anticipate customer needs and social requirements. We believe this is the way for Honda to

proceed, based on our founding principles. To achieve these goals, Honda will work to improve

product quality, safety, and environmental performance as well as promoting research and

development of next-generation mobility technologies such as fuel-cell electric vehicles and

battery-powered EVs. Additionally, we will focus on future product development to expand the

market for hybrid vehicles, which are currently the most effective in reducing CO2 emissions.

And, we will continue our efforts to become a company that society wants to exist through

global activities to minimize environ- mental impact in all of our business activities including

production, distribution, and sales, while promoting safe driving and engagement in other social

activities.

Manufacturing & Distribution

Strengthening our manufacturing system from the perspective of our customers and the

environment

Customer needs vary depending on the region. To deliver products that satisfy customers in all

regions, Honda established a manufacturing system that rapidly and flexibly responds to

customer requests at all production bases around the world. With this manufacturing system, we

are striving to further improve the quality of our products and minimize our environmental

footprint during manufacturing.

Thin-membrane solar cell panels at Dongfeng Honda (Wuhan, China)

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Strengthening manufacturing capabilities and environmental measures on a global basis

Based on its commitment to build products close to the customer, Honda has pursued local

production from its early days. We first began overseas motorcycle production in Belgium in

1963 and became the first Japanese automaker to produce automobiles in the U.S. in 1982. By

focusing on localization early on, even in the areas of development and sales, we have been able

to respond to changes in product demand and supply more promptly and increase our quality and

cost competitiveness in each market. Moreover, we have been working on establishing a

mutually complementary parts and vehicle manufacturing network among countries within a

region so that we can respond to changing demand in each region more effectively and flexibly.

We have also centered on activities that improve quality at production bases around the world

and that reduce environmental impacts during manufacturing and distribution. In 2009, we began

operations at the Ogawa plant in Japan with extremely high resource and energy efficiency.

Meanwhile, we are promoting the installation of solar panels at our offices and plants. Through

improved production systems that take into consideration regional characteristics and enhanced

environmental measures, we will flexibly and effectively provide high-quality products in an

environmentally responsible way.

Motorcycle plant (Thailand)

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Power products assembly (France)

Corporate profile and divisions

Honda is headquartered in Minato, Tokyo, Japan. Their shares trade on the Tokyo Stock

Exchange and the New York Stock Exchange, as well as exchanges in Osaka, Nagoya, Sapporo,

Kyoto, Fukuoka, London, Paris and Switzerland.

The company has assembly plants around the globe. These plants are located in China, the

United States, Pakistan, Canada, England, Japan, Belgium, Brazil, New Zealand, Indonesia,

India, Thailand, Turkey and Perú. As of July 2010, 89 percent of Honda and Acura vehicles sold

in the United States were built in North American plants, up from 82.2 percent a year earlier.

This shields profits from the yen’s advance to a 15-year high against the dollar. Honda's Net

Sales and Other Operating Revenue by Geographical Regions in 2007

Geographic Region Total revenue (in millions of ¥)

Japan 1,681,190

North America 5,980,876

Europe 1,236,757

Asia 1,283,154

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 Others 905,163

American Honda Motor Company is based in Torrance, California. Honda Canada Inc. is

headquartered in the Scarborough district of Toronto, Ontario, and is building new corporate

headquarters in Markham, Ontario, scheduled to relocate in 2008; their manufacturing

division, Honda of Canada Manufacturing, is based in Alliston, Ontario. Honda has also created

joint ventures around the world, such as Honda Siel Cars and Hero Honda Motorcycles in India,

Guangzhou Honda and Dongfeng Honda in China, and Honda Atlas in Pakistan.

Current market position

With high fuel prices and a weak U.S. economy in June 2008, Honda reported a 1% sales

increase while its rivals, including the Detroit Big Three and Toyota, have reported double-digit

losses. Honda's sales were up almost 20 percent from the same month last year. The Civic and

the Accord were in the top five list of sales. Analysts have attributed this to two main factors.

First, Honda's product lineup consists of mostly small to mid-size, highly fuel-efficient vehicles.

Secondly, over the last ten years, Honda has designed its factories to be flexible, in that they can

be easily retooled to produce any Honda model that may be in-demand at the moment.

Nonetheless, Honda, Nissan, and Toyota, were still not immune to the global financial crisis of

2008, as these companies reduced their profitability forecasts. The economic crisis has been

spreading to other important players in the vehicle related industries as well. In November 2009

the Nihon Keizai Shinbun reported that Honda Motor exports have fallen 64.1%.

At the 2008 Beijing Auto Show, Honda presented the Li Nian ("concept" or "idea") 5-door

hatchback and announced that they were looking to develop an entry-level brand exclusively for
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the Chinese market similar to Toyota's Scion brand in the USA. The brand would be developed

by a 50-50 joint-venture established in 2007 with Guangzhou Automobile Industry Group.

Following the Japanese earthquake and tsunami in March 2011 Honda announced plans to halve

production at its UK plants. The decision was made to put staff at the Swindon plant on a 2 day

week until the end of May as the manufacturer struggled to source supplies from Japan. It's

thought around 22,500 cars were produced during this period.

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Marketing Strategies

It has described a category scheme consisting of three general types of strategies that are

commonly used by businesses to achieve and maintain competitive advantage. These three

generic strategies are defined along two dimensions: strategic scope and strategic

strength. Strategic scope is a demand-side dimension and looks at the size and composition

of the market you intend to target. Strategic strength is a supply-side dimension and looks at

the strength or core competency of the firm. In particular he identified two competencies that

he felt were most important: product differentiation and product cost (efficiency).

He originally ranked each of the three dimensions (level of differentiation, relative product

cost, and scope of target market) as either low, medium, or high, and juxtaposed them in a

three dimensional matrix. That is, the category scheme was displayed as a 3 by 3 by 3 cubes.

But most of the 27 combinations were not viable.

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In his 1980 classic Competitive Strategy: Techniques for Analysing Industries and

Competitors, Porter simplifies the scheme by reducing it down to the three best strategies.

They are cost leadership, differentiation, and market segmentation (or focus). Market

segmentation is narrow in scope while both cost leadership and differentiation are relatively

broad in market scope.

Empirical research on the profit impact of marketing strategy indicated that firms with a

high market share were often quite profitable, but so were many firms with low market

share. The least profitable firms were those with moderate market share. This was

sometimes referred to as the hole in the middle problem. Porter’s explanation of this is that

firms with high market share were successful because they pursued a cost leadership strategy

and firms with low market share were successful because they used market segmentation to

focus on a small but profitable market niche. Firms in the middle were less profitable

because they did not have a viable generic strategy.

Porter suggested combining multiple strategies is successful in only one case. Combining a

market segmentation strategy with a product differentiation strategy was seen as an effective

way of matching a firm’s product strategy (supply side) to the characteristics of your target

market segments (demand side). But combinations like cost leadership with product

differentiation were seen as hard (but not impossible) to implement due to the potential for

conflict between cost minimization and the additional cost of value-added differentiation.

Since that time, empirical research has indicated companies pursuing both differentiation

and low-cost strategies may be more successful than companies pursuing only one

strategy.[1]

Some commentators have made a distinction between cost leadership, that is, low cost

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strategies, and best cost strategies. They claim that a low cost strategy is rarely able to

provide a sustainable competitive advantage. In most cases firms end up in price wars.

Instead, they claim a best cost strategy is preferred. This involves providing the best value

for a relatively low price.

Cost Leadership Strategy

This strategy involves the firm winning market share by appealing to cost-conscious or

price- sensitive customers. This is achieved by having the lowest prices in the target market

segment, or at least the lowest price to value ratio (price compared to what customers

receive). To succeed at offering the lowest price while still achieving profitability and a high

return on investment, the firm must be able to operate at a lower cost than its rivals. There

are three main ways to achieve this.

The first approach is achieving a high asset turnover. In service industries, this may mean for

example a restaurant that turns tables around very quickly, or an airline that turns around

flights very fast. In manufacturing, it will involve production of high volumes of output.

These approaches mean fixed costs are spread over a larger number of units of the product

or service, resulting in a lower unit cost, i.e. the firm hopes to take advantage of economies

of

scale and experience curve effects. For industrial firms, mass production becomes both a

strategy and an end in itself. Higher levels of output both require and result in high market

share, and create an entry barrier to potential competitors, who may be unable to achieve the

scale necessary to match the firms low costs and prices.

The second dimension is achieving low direct and indirect operating costs. This is achieved

by offering high volumes of standardized products, offering basic no-frills products and

limiting customization and personalization of service. Production costs are kept low by using
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fewer components, using standard components, and limiting the number of models produced

to ensure larger production runs. Overheads are kept low by paying low wages, locating

premises in low rent areas, establishing a cost-conscious culture, etc. Maintaining this

strategy requires a continuous search for cost reductions in all aspects of the business. This

will include outsourcing, controlling production costs, increasing asset capacity utilization,

and minimizing other costs including distribution, R&D and advertising. The associated

distribution strategy is to obtain the most extensive distribution possible. Promotional

strategy often involves trying to make a virtue out of low cost product features.

The third dimension is control over the supply/procurement chain to ensure low costs. This

could be achieved by bulk buying to enjoy quantity discounts, squeezing suppliers on price,

instituting competitive bidding for contracts, working with vendors to keep inventories low

using methods such as Just-in-Time purchasing or Vendor-Managed Inventory. Wal-Mart is

famous for squeezing its suppliers to ensure low prices for its goods. Dell Computer initially

achieved market share by keeping inventories low and only building computers to order.

Other procurement advantages could come from preferential access to raw materials, or

backward integration.

Some writers posit that cost leadership strategies are only viable for large firms with the

opportunity to enjoy economies of scale and large production volumes. However, this takes

a limited industrial view of strategy. Small businesses can also be cost leaders if they enjoy

any

advantages conducive to low costs. For example, a local restaurant in a low rent location can

attract price-sensitive customers if it offers a limited menu, rapid table turnover and employs

staff on minimum wage. Innovation of products or processes may also enable a startup or

small company to offer a cheaper product or service where incumbents' costs and prices

have become too high. An example is the success of low-cost budget airlines who despite
20
having fewer planes than the major airlines, were able to achieve market share growth by

offering cheap, no-frills services at prices much cheaper than those of the larger incumbents.

A cost leadership strategy may have the disadvantage of lower customer loyalty, as price-

sensitive customers will switch once a lower-priced substitute is available. A reputation as a

cost leader may also result in a reputation for low quality, which may make it difficult for a

firm to rebrand itself or its products if it chooses to shift to a differentiation strategy in

future.

Differentiation Strategy

Differentiate the products in some way in order to compete successfully. Examples of the

successful use of a differentiation strategy are Hero Honda, Asian Paints, HLL, Nike athletic

shoes, Perstorp BioProducts, Apple Computer, and Mercedes-Benz automobiles.

A differentiation strategy is appropriate where the target customer segment is not price-

sensitive, the market is competitive or saturated, customers have very specific needs which

are possibly under-served, and the firm has unique resources and capabilities which enable it

to satisfy these needs in ways that are difficult to copy. These could include patents or other

Intellectual Property (IP), unique technical expertise (e.g. Apple's design skills or Pixar's

animation prowess), talented personnel (e.g. a sports team's star players or a brokerage firm's

star traders), or innovative processes. Successful brand management also results in perceived

uniqueness even when the physical product is the same as competitors. This way, Chiquita

was able to brand bananas, Starbucks could brand coffee, and Nike could brand sneakers.

Fashion brands rely heavily on this form of image differentiation.

Variants on the Differentiation Strategy

The shareholder value model holds that the timing of the use of specialized knowledge can

create a differentiation advantage as long as the knowledge remains unique.[2] This model
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suggests that customers buy products or services from an organization to have access to its

unique knowledge. The advantage is static, rather than dynamic, because the purchase is a

one-time event.

The unlimited resources model utilizes a large base of resources that allows an organization

to outlast competitors by practicing a differentiation strategy. An organization with greater

resources can manage risk and sustain profits more easily than one with fewer resources.

This deep-pocket strategy provides a short-term advantage only. If a firm lacks the capacity

for continual innovation, it will not sustain its competitive position over time.

Focus or Strategic Scope

This dimension is not a separate strategy per se, but describes the scope over which the

company should compete based on cost leadership or differentiation. The firm can choose to

compete in the mass market (like Wal-Mart) with a broad scope, or in a defined, focused

market segment with a narrow scope. In either case, the basis of competition will still be

either cost leadership or differentiation.

In adopting a narrow focus, the company ideally focuses on a few target markets (also called

a segmentation strategy or niche strategy). These should be distinct groups with specialized

needs. The choice of offering low prices or differentiated products/services should depend

on the needs of the selected segment and the resources and capabilities of the firm. It is

hoped that by focusing your marketing efforts on one or two narrow market segments and

tailoring your marketing

mix to these specialized markets, you can better meet the needs of that target market. The

firm typically looks to gain a competitive advantage through product innovation and/or

brand

marketing rather than efficiency. It is most suitable for relatively small firms but can be used
22
by any company. A focused strategy should target market segments that are less vulnerable

to substitutes or where a competition is weakest to earn above-average return on investment.

Examples of firm using a focus strategy include Southwest Airlines, which provides short-

haul point-to-point flights in contrast to the hub-and-spoke model of mainstream carriers,

and Family Dollar.

In adopting a broad focus scope, the principle is the same: the firm must ascertain the needs

and wants of the mass market, and compete either on price (low cost) or differentiation

(quality, brand and customization) depending on its resources and capabilities. Wal Mart has

a broad scope and adopts a cost leadership strategy in the mass market. Pixar also targets the

mass market with its movies, but adopts a differentiation strategy, using its unique

capabilities in story-telling and animation to produce signature animated movies that are

hard to copy, and for which customers are willing to pay to see and own. Apple also targets

the mass market with its iPhone and iPod products, but combines this broad scope with a

differentiation strategy based on design, branding and user experience that enables it to

charge a price premium due to the perceived unavailability of close substitutes.

Recent developments

Michael Treacy and Fred Wiersema (1993) in their book The Discipline of Market Leaders

have modified Porter's three strategies to describe three basic "value disciplines" that can

create

customer value and provide a competitive advantage. They are operational excellence,

product leadership, and customer intimacy.

Criticisms of generic strategies

Several commentators have questioned the use of generic strategies claiming they lack

specificity, lack flexibility, and are limiting.

23
In particular, Miller (1992) questions the notion of being "caught in the middle". He claims

that there is a viable middle ground between strategies. Many companies, for example, have

entered a market as a niche player and gradually expanded. According to Baden-Fuller and

Stopford (1992) the most successful companies are the ones that can resolve what they call

"the dilemma of opposites".

A popular post-Porter model was presented by W. Chan Kim and Renée Mauborgne in their

1999 Harvard Business Review article "Creating New Market Space". In this article they

described a "value innovation" model in which companies must look outside their present

paradigms to find new value propositions. Their approach fundamentally goes against

Porter's concept that a firm must focus either on cost leadership or on differentiation. They

later went on to publish their ideas in the book Blue Ocean Strategy.

An up-to-date critique of generic strategies and their limitations, including Porter, appears in

Bowman, C. (2008) Generic strategies: a substitute for thinking? [1]

Electric and alternative fuel vehicles

2009 Honda Civic GX hooked up to Phill refueling system

Top: Brazilian flexible-fuel Honda Civic. Below: U.S. Honda Civic Hybrid.

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Compressed Natural Gas

The Honda Civic GX is the only purpose-built natural gas vehicle (NGV) commercially

available in some parts of the U.S. The Honda Civic GX first appeared in 1998 as a factory-

modified Civic LX that had been designed to run exclusively on compressed natural gas.

The car looks and drives just like a contemporary Honda Civic LX, but does not run on

gasoline. In 2001, the Civic GX was rated the cleanest-burning internal combustion engine

in the world by the U.S. Environmental Protection Agency (EPA).

First leased to the City of Los Angeles, in 2005, Honda started offering the GX directly to

the public through factory trained dealers certified to service the GX. Before that, only fleets

were eligible to purchase a new Civic GX. In 2006, the Civic GX was released in New York,

making it the second state where the consumer is able to buy the car. Home refueling is

available for the GX with the addition of the Phill Home Refueling Appliance.

Flexible-fuel

Honda's Brazilian subsidiary launched flexible-fuel versions for the Honda Civic and Honda

Fit in late 2006. As others Brazilian flex-fuel vehicles, these models run on any blend

of hydrous ethanol (E100) and E20-E25 gasoline. Initially, and in order to test the market

preferences, the carmaker decided to produce a limited share of the vehicles with flex-fuel

engines, 33 percent of the Civic production and 28 percent of the Fit models. Also, the sale

price for the flex-fuel version was higher than the respective gasoline versions, around

US$1,000 premium for the Civic, and US$650 for the Fit, despite the fact that all other flex-

fuel vehicles sold in Brazil had the same tag price as their gasoline versions. In July 2009,

Honda launched in the Brazilian market its third flexible-fuel car, the Honda City.

During the last two months of 2006, both flex-fuel models sold 2,427 cars against 8,546

gasoline-powered automobiles, jumping to 41,990 flex-fuel cars in 2007, and reaching

25
93,361 in 2008. Due to the success of the flex versions, by early 2009 a hundred percent of

Honda's automobile production for the Brazilian market is now flexible-fuel, and only a

small percentage of gasoline version is produced in Brazil for exports.

In March 2009, Honda launched in the Brazilian market the first flex-fuel motorcycle in the

world. Produced by its Brazilian subsidiary Moto Honda da Amazônia, the CG 150 Titan

Mix is sold for around US$2,700.

Hybrid electric

In late 1999, Honda launched the first commercial hybrid electric car sold in the U.S. market

, the Honda Insight, just one month before the introduction of the Toyota Prius, and initially

sold for US$20,000. The first-generation Insight was produced from 2000 to 2006 and had

afuel economy of 70 miles per US gallon (3.4 L/100 km; 84 mpg-imp) for the EPA's highway

rating, the most fuel-efficient mass-produced car at the time. Total global sales for the

Insight amounted to only around 18,000 vehicles.

Honda introduced the second-generation Insight in its home nation of Japan in February

2009, and released it in other markets through 2009 and in the U.S. market in April 2009. At

$19,800 as a five-door hatchback it will be the least expensive hybrid available in the U.S.

Honda expects to sell 200,000 of the vehicles each year, with half of those sales in the

United States.

Since 2002, Honda has also been selling the Honda Civic Hybrid (2003 model) in the U.S.

market,. It was followed by the Honda Accord Hybrid, offered in model years 2005 through

2007. Sales of the Honda CR-Z began in Japan in February 2010, becoming Honda's third

hybrid electric car in the market.

In an interview in early February 2011, a Honda executive disclosed that Honda produces

around 200,000 hybrids a year in Japan.

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Hydrogen fuel cell

In Takanezawa, Japan, on 16 June 2008, Honda Motors produced the first assembly-line

FCX Clarity, a hybrid hydrogen fuel cell vehicle. More efficient than a gas-electric hybrid

vehicle, the FCX Clarity combines hydrogen and oxygen from ordinary air to generate

electricity for an electric motor.

The vehicle itself does not emit any pollutants and its only by products are heat and water.

The FCX Clarity also has an advantage over gas-electric hybrids in that it does not use an

internal combustion engine to propel itself. Like a gas-electric hybrid, it uses a lithium ion

battery to assist the fuel cell during acceleration and capture energy through regenerative

braking, thus improving fuel efficiency. The lack of hydrogen filling stations throughout

developed countries will keep production volumes low. Honda will release the vehicle in

groups of 150. California is the only U.S. market with infrastructure for fueling such a

vehicle, though the number of stations is still limited. Building more stations is expensive, as

the California Air Resources

Board (CARB) granted $6.8 million for four H2 fueling stations, costing $1.7 million USD

each.

27
 Objectives of the Study

· To know about the Honda company.

· To know about its Promotional activities.

· Its Market Position.

· Honda’s level of customer satisfaction.

· Its history and the company profile.

· Cost saving initiatives.

Hypothesis

A hypothesis consists either of a suggested explanation for an observable

phenomenon or of a reasoned proposal predicting a possible causal correlation among

multiple phenomena. The term derives from the Greek, hyposthenia meaning "to put under"

or "to suppose." The scientific method requires that one can test a scientific hypothesis.

Scientists generally base such hypotheses on previous observations or on extensions of

scientific theories. Even though the words "hypothesis" and "theory" are often used

synonymously in common and informal usage, a scientific hypothesis is not the same as a

scientific theory.

Hypothesis may be defined as a proposition or a set of proposition set forth as an

explanation for the occurrence of some specified group of phenomenon either asserted

merely as a provisional conjecture to guide some investigation or accepted as highly

probable in the light of established facts. Quite often a research hypothesis is a predictive

statement, capable of being tested by scientific methods, that relates an independent variable

to some dependent variable.

28
 NULL HYPOTHESIS

A null hypothesis is a hypothesis (within the context of statistical hypothesis testing) that

might be falsified on the basis of observed data. The null hypothesis typically proposes a

general or default position, such as that there is no relationship between two quantities, or

that there is no difference between a treatment and the control. The term was originally

coined by English geneticist and statistician Ronald Fisher.

The null hypothesis (often denoted by H0) formally describes some aspect of the statistical

"behavior" of a set of data. The Null Hypothesis is of this project report is that customers are

highly satisfied.

ALTERNATE HYPOTHESIS

Alternative hypothesis is the "hypothesis that the restriction or set of restrictions to be tested

does NOT hold." often denoted H1. Synonym for 'maintained hypothesis.' The Alternate

Hypothesis of this project report is that customers are not satisfied

 Honda Quality & Assurance Cant be replaced by anyone.

 Honda Promotional Strategies are distinct and strike Honda directly in Mind

 Honda use new Technology to promote their existing products.

29
Research Methodology

The purpose of methodology is to describe the process involved in research work. This

includes the overall research design, data collection method, the field survey and the analysis

of data.

Research is a common parlance refresh to a search for knowledge. One can also define

research as a scientific & systematic search for pertinent information on a specific topic.

In fact, research is an art of scientific investigation. The advance learner’s dictionary of

current English lay down the meaning research as a careful investigation & inquiry specially

search for new facts in any branch knowledge.

Research Design

Research Design is the arrangement for conditioned for data collection & analysis of data in

a manner that aims to combined relevance to research purpose with economy in procedure.

A research design is a master plan or model for the conduct of formal investigation. It is blue

print that is followed in completing study.

The research conducted by me is a descriptive research. This is descriptive in nature because

study is focused on fact investigation in a well structured from and is based on primary data.

Research Plan

Type of study: For completing my study I have gone for sample study because looking at

the size of population & the time limitation it was not convenient for me to cover entire

population. Hence, I have gone for sample study rather than census study.

Sampling Plan

A sample design is a definite plan for obtaining a sample from a given population. It refers
30
 to the technique or the procedure that researcher would adopt in selecting items to be inched

in the sample i.e. the size of sample. Sampling plan is determined before data are collected.

Steps in Sampling:

1. Understanding the Marketing strategies of Honda.

2. Study the company profile & related aspects.

3. To collect the information from self constructed questionnaire.

4. Meeting with different owners of Honda showroom.

5. Obtaining the opinion and suggestions of owners at different levels.

6. Prepare questionnaire on the basis of above information.

7. Gather information from different source like books Internet magazines etc.

8. On the basis of the answers and the information gathered from other sources prepare the

report.

Sampling Frame:

The list of sampling units from which sample is taken is called sampling frame.

Sampling Size:

Total sample size is 50.

Sampling Procedure:

The selection of respondents were accordingly to be in a right place at a right time and so the

sampling were quite easy to measure, evaluate and co-operative. It was a randomly area

sampling method that attempts to obtain the sample of convenient.

31
DATA ANALYSIS AND INTERPRETATION

Automobile are sold with service as a supplement to main product. Being a sophisticated

engineering base product service becomes a major driver for product save. Various

researches have already proved that the quality of service backup adds to image of product

and intern the total turnover. The data as we received from various segments related to

automobile service backup is analyzed here under. The variables have been identified on

their sent scale basis and later on support of the licker scale was used to identify cross

relationship among the variables. The results are here under.

Table 5.1 Vehicle service back up facility

Yes 390 95.12

No 020 04.88

4.88

Yes
No

95.12

32
Figure 5.1 Vehicle has service back up facility

When asked for this question to the people out of 410 people 95.12% know about the service

back up facility provided by the dealer to them. They were aware of the services. The rest

4.88% were not aware to the services or they were not bothered for the services provided to

them for them the purchase factor mattered and the service factor could be handled by the

other factor. This was due to ignorance of the customers. The most service facility

demanded was from the service class people who were too calculated. Whereas the

business class was last hophead

for free service. It was only their driver who took the cars if needed for a service.

Table 5. 2 Read the service book let came with your vehicle

Yes 300 73.17

No 110 26.83

Read service booklet

No
27%

Yes
73%

33
Figure 5.2 Read the service booklet came with your vehicle

Out of the sample of 410, 300 customers read the service booklet which was given to them

by the dealers along with the purchase of the car. The customers who read the service

booklet were well aware of the services provided. The rest of the customers did not read the

service booklet due to some of the other reasons.

2 01 02.44

3 31 75.61

4 04 09.76

5 02 04.88

6 01 02.44

3+ 02 04.88

extended

Free Service attach with vehicle

80.00
70.00
60.00
50.00
40.00
30.00
20.00
10.00
0.00
2 3 4 5 6 3+

Figure 5.3 Free service attach with vehicle

34
From the above table we could know that 75.61% respondents 3 service in the back up

service, 09.76% respondents were provided with 4 free services with their car purchase,

04.88% respondents were provided with 5 after sales services, while 02.44% respondents

was provided with 6 after sales services.

0 10 02.44

1 10 02.44

2 60 14.63

3 230 56.10

4 050 12.20

5 000 00.00

6 030 07.32

7 020 04.88

60 56.1

50

40

30
Series2
20
14.63
12.2
10 7.32
4.88
2.44 2.44
0
0
1 2 3 4 5 6 7 8

Figure 5.4 Service you acquired

Respondent’s when asked for this question 230 out of 410 acquired all their services with

35
their cars. 60 customers acquired 2 services while 50 customers acquired 4 services 30

customers acquired 6 services and 20 acquired 7 services and 10 customers acquired only 1

services offered by the dealers.

Self 270 65.85

Driver 130 31.71

Service Center 000 00.00

Help

Send the vehicle to service centre

70.00
60.00
50.00
40.00
65.85
30.00
20.00 31.71
10.00
0.00
Yes No

Figure 5.5 how send the vehicle to the service centre

The above table shows that 270 (65.85%) do the honors of sending their cars at service

center at their own as most of the service center do not have the pickup service available at

their service center. Respondent are dissatisfied with this but they do not have any choice

left with them and to acquire to free services they are ready to drop the car on their own at

the service station. The second reason for doing this is that they do not want to mis on any

36
services whether needed or not just because it is there in the service booklet. They need to

get it done.

130 (31.71%) of the respondents send their car with their drivers. This groups is usually the

group who is the business class for them service in

the booklet does not matter. They have the drivers who take their cars for services when they

feel like or when told by the owner that it should be clean.

The rest of the respondents have not selected any option for the same.

Yes 190 46.34

No 220 53.66

Intimation for the service

60

50

40

30
No, 53.66
Yes, 46.34
20

10

0
Yes No

Figure 5.6 Receive any intimation for service is due

From the above table it is seen that 190 (46.34) respondents have received estimation from

the service centre / dealer about their services due. Whereas 220 (53.66%) respondents were

not given any type of intimation from their service centre / dealer when their service were

due. That means there was a lack of reminders from the dealer side and due to this reason

37
respondents were left out or missed on for their services. This created dissatisfaction among

the respondents.

Respondent who said No for intimation had to put in front to remind that their service is

calling due. Duel they were kept waiting for their turn and yet there were no calls. Lastly

they themselves had to take their cars for services at the service centers.

Yes 260 63.41

No 150 36.59

Maintain delivery schedule

70
60
50
40
63.41
30
20 36.59
10
0
Yes No

Figure 5.7 Service centre maintain the delivery schedule

From above table it is seen that 260 (63.41%) respondents have opined that the service

centre maintained the delivery schedule with them. Rest 150 (36.59%) respondents are with

the opinion that the delivery schedule were not maintained.

Respondent we satisfied that the service centre kept a record of delivery schedule. It was

difficult to maintain the delivery schedule from the service centre. As it was an tedious job

to keep record of the whole data.

38
 Yes 250 60.98

No 160 39.02

Complete all the jobs without

reminders

No
39%

Yes
61%

Figure 5. 8 Service centre completes all the jobs without reminders From the above table

we could see that 60.98% respondents were happy that the jobs were completed by the

service center without reminders.

39.02% respondents said that job was not done if proper reminders were not given.

Every time the respondents had to pin Pont the service person or dealer to specifically do a

particular job. They were not happy if the job were half done and the car was handed over to

them. E.g. changing of the oil was always on the left out part.

Among of the do’s A perfect clean up, wash up and alignment of wheels were accepted.

39
 Yes 320 78.05

No 090 21.95

Maintanance of the Service Records

80
70
60
50
40 78.05
30
20
21.95
10
0
Yes No

Figure 5.9: Service center maintain record on your service booklet The chart shows that

320 (78.05%) respondents said that the service centre maintained the service record in the

vehicle booklet. The reason behind this was that no respondents could be able to take more

services than what was provided. As if they did not maintain this they had proof that

customers were provided with two services.

90(21.95%) respondents had this complain that record were not maintained on the service

booklet. This was due to the negligence of the respondents that they forgot to get it noted in

the service booklet.

40
 Yes 240 58.53%

No 170 41.47%

Change for service provider

70.00%
60.00%

50.00%
40.00%
30.00% Yes, 58.53%
20.00% No, 41.47%

10.00%
0.00%
Yes No

Figure 5.10: Change the service provider

The result shows that 58.53% people want to change the service provider while 41.47%

people wanted to slick to the same service provider. Constant lack of reminder, providing

the service just for name, sake to dill that they are providing services, lack of spare parts,

expensive spare parts, lack of good service employee.

41
 7 040 09.76

8 170 41.46

9 160 39.02

10 040 09.76

Satisfaction with service of vehicle

45 41.46
39.02
40
35
30
25
20 Series2
15
9.76 9.76
10
5
0
1 2 3 4 5

Figure 5.11 satisfactions with service of vehicle

The above graph shows that when scored from 10, 40 respondents gave 7 out of 10, 170

respondents gave 8 out of 10, 160 respondents gave 9 out of 10 and 40 respondents 10 out of

10 to the satisfaction for service for their vehicle. That means that the highest was 8 given by

170 respondents for the satisfaction.

42
 7 120 29.27

8 100 24.39

9 150 36.59

10 040 09.76

4 9.76

3 36.59

Series2
2 24.39

1 29.27

0 10 20 30 40

Figure 5.12 Satisfaction with spare parts replacement

As we know that replacement of spare parts plays a vital role in after sale services provided

to the customers along with the purchase of cars. 150 respondents have given 9 out of 10 to

the satisfaction to the spare parts replacement. They agree that the dealers do provide the

replacement of spare parts in the services provided in the booklet. 120 respondents give 7

out of 10 for the same reason. Rests 40 were on 10 out of 10 who were fully satisfied and

had no complaints for the replacement of spare parts.

43
 6 020 04.88

7 060 14.63

8 140 34.15

9 120 29.27

10 070 17.07

5 17.07

4 29.27

3 34.15
Series2

2 14.63

1 4.88

0 10 20 30 40

Figure 5.13 Expertise of technical workers

From the above table we could see that 140 respondents give 8 out of 10 for the expertise

technical workers at the service center. No doubt when the dealer is renowned and prestigious he

has to be sure that what he provides should be the best and which will bring a sense of positivity

in the customers mind. The technical staff at the service center was knowledgeable and knew

what and how to do. With less instruction they did their work so that grievance from the

44
customers should be avoided. 120 respondents gave 9 out of 10 which too was not a bad

response.

Only 20 respondents give 6 out of 10 and were those people who themselves were not aware

what actually the technical work stood for.

6 020 04.88

7 110 26.83

8 100 24.39

9 130 31.71

10 050 12.20

Behavior of technical workers at

service center
5 12.2

4 31.71

3 24.39
Series1
2 26.83

1 4.88

0 5 10 15 20 25 30 35

Figure 5.14 Behavior of technical workers at service center

From the above table we could conclude that 130 respondent ranked 9 out of 10 for the behavior

of the technical workers at the service center. This was reasonable enough as the technical staff

cooperated with the customers. The technical staff really had a positive approach to words the

45
work which was allotted to them and approaching attitude with a welcome of no denial of work.

Only 20 respondents give 6 out of 10 to the technical workers to their behavior in the service

center. This was because of miscommunication between giving orders and receiving orders.

6 040 09.76

7 110 26.83

8 110 26.83

9 110 26.83

10 040 09.76

Care taking attitudes of technical

workers at service centers

10 10, 9.76
9 9, 26.83
8 8, 26.83
7 7, 26.83
6 6, 9.76
Brand

0 5 10 15 20 25 30

Figure 5.15 care taking attitude of technical workers

46
We all know that one owns a car he or she become very possessive and puts in too many affords

to handle it. At the same time they are also very conscious that while giving their vehicle for a

service he should be handle with care and in safe hands.

From the above table 7, 8, and 9 ranked out of 10 were given for taking care their vehicle by the

service center and their workers. It shows that the respondents were pretty happy with their care

taking attitude. 40 respondents ranked 10 out of 10 for full satisfaction and rest 40 respondents

give 6 out of 10 for less care taking.

47
 CONCLUSION

Honda is committed to further advancing power train technologies in order to offer new products

and technologies that satisfy growing demand from customers around the world for high fuel

efficiency and to achieve more environmentally-friendly mobility that more people can enjoy.

Honda will continue to dedicate company resources to the creation of new technologies. Honda

will also continue making capital investments proactively to strengthen the flexibility and

efficiency of its global production network.

Setting customer satisfaction as our number one priority, Honda strives to provide the joy of

mobility to even more customers through the introduction of new technologies and new products.

n this is achieved, our sales should reach approximately 16 million units for motorcycles,

approximately 4 million units for automobiles, and approximately 6.5 million units for power

products by the end of the 9th Mid-term. In terms of sales revenue, this will exceed 10 trillion

yen.

Through all of these efforts, Honda’s goal is to be a company that society wants to exist, to

pursue the joy of mobility, and to extend this joy to more customers and to future generations.

48
 BIBLIOGRAPHY

DI Managing Marketing Management Resources Course (2010)

RDI Managing Change in Organisations Resources Course Material (2009)

Daft, R (2008) New Era of Management, 2nd Edition, Thomson South-Western

Fellman, M.W (1999), Cause marketing takes a strategic turn, Marketing News,

Kassaye, W.W. (2001), Green dilemma, Marketing Intelligence & Planning, Vol. 19 No. 6

Kotler, P (2006) Marketing Management, 12th Edition, Prentice Hall.

Websites:

http://world.honda.com

Honda Annual Report 2010

Honda CSR Report 2007

Marketing Strategies – Honda “FCX” Clarity, Rohit Sharma

49