INTRODUCTION

Bajaj Auto Ltd. (BAJAJ-AUTO)

Bajaj Auto Ltd (BAL) is one of the leading two & three-wheeler manufacturers in India. The
company is well known for its R&D product development process engineering and low-cost
manufacturing skills. The company is the largest exporter of two and three-wheelers in the country.
The company has two subsidiaries namely Bajaj Auto International Holdings BV and PT Bajaj
Indonesia.
On 29 November 1945 Bajaj Auto came into being under the name M/s Bachraj Trading
Corporation Private Limited. In 1948 Bajaj Auto started selling imported two- and three-wheelers
in India. In 1959 Bajaj Auto obtained license from the Government of India to manufacture two-
and three-wheelers. In the year 1960 Bajaj Auto became a public limited company. In the year
1970 Bajaj Auto rolled out its 100000th vehicle. In 1971 Bajaj Auto launched three-wheeler goods
carrier. In 1977 the company launched Rear Engine Autorickshaw. On 19 January 1984 the
foundation stone was laid for Bajaj Auto's new plant at Waluj Aurangabad. On 5 November 1985
Bajaj Auto commenced production at Waluj plant. In 1998 Bajaj Auto commenced production at
its Chakan Pune plant. In November 2001 Bajaj Auto launched its premium bike 'Pulsar'. In
February 2003 Bajaj Auto launched Caliber115 in the executive motorcycle segment. Pursuant to
the Scheme of Arrangement of Demerger Bajaj Holdings & Investments Ltd (BHIL erstwhile
BAL) was demerged into three undertakings with effect from the effective date viz. 20 February
2008. The holding company operated in the segments such as automotive insurance and investment
and others. Considering the growth opportunities in the auto wind-energy insurance and finance
sectors the holding company de-merged its activities into three separate entities each of which can
focus on their core businesses and strengthen competencies. The auto business of the holding
company along with all assets and liabilities pertaining thereto including investments in PT Bajaj
Auto Indonesia and in a few vendors, companies transferred to Bajaj Investment & Holding Ltd
(BHIL). In addition, a total of Rs 15000 million in cash and cash equivalents also transferred to
Bajaj Investment & Holding Ltd. As the part of the scheme Bajaj Holdings and Investment Ltd
was renamed as Bajaj Auto Ltd (BAL). The appointed date of this de-merger was closing hours of
business on March 31 2007.In April 9 2007 the company inaugurated their green field plant at
Pantnagar in Uttarakhand. In the first year of operations the plant produced over 275000 vehicles.
The company's vehicle assembly plant at Akurdi was shut down from September 3 2007 due to
higher cost of production. In November 2007 Bajaj Auto International Holdings BV a wholly
owned subsidiary company acquired 14.51% equity stake in KTM Power Sports AG of Austria
Europe's second largest sport motorcycle manufacturer for Rs 345 crore. During the year 2007-08
the company launched XCD 125 DTS-Si and the Three-wheeler Direct Injected auto rickshaw.
The Chakan plant completed the cumulative production of over 2 million Pulsar. During the year
2009-10 the company expanded the production capacity of Motorised Two & Three Wheelers by
300000 Nos to 4260000 Nos. The company launched Pulsar 220 F Pulsar 180 UG Pulsar 150 UG
Pulsar 135 LS and Discover DTS-s i in the market. During the year 2010-11 the company expanded
the production capacity of Motorized two & three Wheelers by 780000 Nos to 5040000 Nos.
The company launched Avenger 220 DTS-i KTM Duke 125 Discover 150 and Discover 125 in
the market. The company plans to maintain the capacity of two and three-wheelers at the current
level of 5040000 numbers per annum during the year ending 31 March 2012.
The 4-wheel vehicle development work is under progress and commercial launch of the first
product from this platform is scheduled for 2012.In 2012 Bajaj Auto tied up with Japan's Kawasaki
in Indonesia. In 2013 the Company has introduced another variant of premium motorcycles under
the Bajaj-KTM joint venture namely Duke 390cc for a price of Rs 1.83 lakh. The company also
received 'CII Design Excellence Award ‘In 2014 Bajaj Auto bagged order in Sri Lanka -People's
Choice Bike of the Year - CNBC TV18 Overdrive Awards. The Company has also received Bike
of the Year BBC Top gear Awards. In 2015 Bajaj Auto has introduced the all-new Platina electric
start 100 cc bike to the long-distance commuter. On 8 August 2017 Bajaj Auto and Triumph
Motorcycles UK announced global partnership whereby Bajaj will gain access to the iconic
Triumph brand and its great motorcycles enabling it to offer a wider range of motorcycles within
its domestic market and other international markets.

Bajaj's Vision for Continuous Growth and Excellence

Bajaj Auto Limited has risen to this level riding on a vision of its founding fathers. The same is
needed for continuous growth and manufacturing excellence. Rahul Bajaj, the Chairman of the
Bajaj Group, has set some guidelines for the company to follow and achieve heights of brilliance
in the coming years. These guidelines are mentioned below:

• Bajaj Auto Limited will continuously specialize its Motorcycle and Commercial Vehicle
brands through its strategy of differentiation.
• To 'defend' its brands, Bajaj Auto Limited will continuously improve its core competencies
in all its functions, all over its supply chain, including its suppliers and dealers.
• Bajaj Auto Limited's core competencies rest on its value of innovation, perfection and
speed.
• Bajaj Auto Limited has adopted Total Productive Maintenance, the prime mover towards
excellence, to build and to continuously improve its core competencies.
• Total Productive Maintenance shall provide a holistic, structured and quantifiable
methodology for deeper and wider continuous improvement in an integrated way aligned
to Bajaj Auto Limited's business vision.
• Total Productive Maintenance ensures that every employee of Bajaj Auto Limited and its
business partners, individually as well as collectively, strive to keep Bajaj Auto Limited
distinctly ahead.
Key Dates in Bajaj History
• 1971 - three-wheeler goods carrier
• 1972 - Bajaj Chetak
• 1976 - Bajaj Super
• 1977 - Rear engine Autorickshaw
• 1981 - Bajaj M-50
• 1986 - Bajaj M-80, Kawasaki Bajaj KB100
• 1990 - Bajaj Sunny
• 1994 - Bajaj Classic
• 1995 - Bajaj Super Excel
• 1997 - Kawasaki Bajaj Boxer, Rear Engine Diesel Autorickshaw
• 1998 - Kawasaki Bajaj Caliber, Legend (India's first four-stroke scooter)
• 2000 - Bajaj Saffire
• 2001 - Eliminator, Pulsar
• 2003 - Caliber115, Bajaj Wind 125, Bajaj Pulsar
• 2004 - Bajaj CT 100, New Bajaj Chetak 4-stroke with Wonder Gear, Bajaj Discover DTS-i
• 2005 - Bajaj Wave, Bajaj Avenger, Bajaj Discover
• 2006 - Bajaj Platina
• 2007 - Bajaj Pulsar-200

Facilities Location
India
➢ Chakan and Akurdi (near Pune)
➢ Waluj (near Aurangabad)
➢ Pant Nagar (Uttaranchal)

Chakan Pune Plant

 • Chakan Industrial Area, Chakan, Pune. This is the biggest plant of Bajaj auto Production
Capacity of 1.2 million/ year. Product manufactured here are pulsar and avenger and
commercial Ge series.
• This plant won the Frost & Sullivan India Manufacturing Excellence Award. Super
Platinum Award was constituted this year to recognize the best of the best in manufacturing
excellence. In the process, this Bajaj plant became the first company to get this honor.

Lean Supply Chain

Chakan has 80 vendors to meet the entire set of requirements while Uttaranchal will have 16
catering to 75 percent of the needs. The latter will present a lean supply chain and is intended to
be an extended factory. The values remain the same in both plants as regards people etc.

AKURDI PUNE PLANT

• Manufacturing locations Akurdi, Pune This is one of the oldest plant of Bajaj auto ltd with
production capacity of 0.6 million vehicles/ year. The plant has been closed in order to
equip for four-wheeler production

WALUJ PLANT
• Bajaj Nagar, Waluj Aurangabad This is second plant with production capacity of 0.86
million/ year. Products manufactured here are Kristal, XCD and platina and commercial
GC series
• Waluj is now the export hub of Bajaj Auto
• The basic raw materials are steel and aluminum. Surface treatment processes like heat
treatment, painting and electroplating are carried out in the factory.

PANTNAGAR PLANT
• Pantnagar, Uttarakhand is the he most advanced plant of Bajaj auto . It has Capacity of 0.9
million vehicles per year, product manufactured here are platina and XCD.
• To maximize tax benefits available at Uttarakhand, the Company has shifted products like
Discover and Pulsar 135 to Pantnagar
• They outsource machinery and have four assembly lines which operate in two shifts with
950 manpower, manufacturing 6000 vehicles per day and targeting 1.5 Lakh vehicles per
month. The efficiency of the plant is 96%.
Bajaj Motorcycle in 150cc – 180cc segment
Bajaj Pulsar DTSi – Bajaj Pulsar is available in both 150cc-180cc segment. Bajaj pulsar has been
one of the star performing bike for Bajaj in the market. It has changed the whole market scenario
from its launch time. With Digital odometer, digital speedometer, Digital fuel gauge and two
digital trip meter contributes to enhanced riding comfort. It is the first bike in India with large
33mm front fork for better shock absorb. Tubeless tires, constant velocity carburetor for high level
of performance and aerodynamic design are a total package from Bajaj.

Bajaj Motorcycle in 200cc and above segment

Bajaj Pulsar DTSi 200cc and 220cc:- It is the extension of Pulsar in to the segment of 200 and 220
cc segment , equipped with some of the high end technology such as digital twin spark fuel spark
injection, front and rear disc brake etc is a tailor made high adrenaline rushing package.
It is to be noted that Bajaj is going to launch its 250cc and 300cc of Pulsar, which will open up
new avenues in this segment.

II OPERATIONAL EXCELLENCE
Value Chain Analysis of Bajaj Auto

Suppliers:
• Bajaj selects those suppliers who provides majority of the required raw materials
together.
• Bajaj Auto has 198 key suppliers for their raw materials. Some key Suppliers
are:
 Suppliers Materials
JBM Frames
MRF & Dunlop Tires
Minda Locks and Ignition Systems
Reinder Headlamps and Light
Endurance Brakes, clutch and Cast vehicles
Varroc Digital Meter and Plastic parts
Max Auto Components Ignition system and switches
Silico Cable Wires and cables
Makino Industry Brake shoes, Brake lining and Clutch Centre

Process of ordering:
Bajaj follows a systematic process in selecting suppliers and deal with them

Email for
material in
Decision for advance
time period
of raw
Invitation by material
manager for
meeting
Application
of supplier

Inventory policy
• Bajaj auto maintains seven days inventory.
• Demand Estimations are based on Panel Regression, which takes into account both time
series and cross section variation in data.
• All the Mediators are connected with each other through IT linkage to know exact status
of delivery of goods
Maintaining Relation:

Bajaj auto pay them

regularly.

The suppliers gets up-to

date information on
purchase order, contracts
and material schedule

Manufacturing:
• With operations spanning to such vast geographies, managing a value chain globally
becomes more and more complex.
• In countries where Bajaj perceives a strong market potential, they establish a tie up
with one major industrial establishment eager to invest in the project.
• This investment may include setting up strategic manufacturing, assembly units,
technology transfer, distribution and after sales services.
 Fabrication (Body &
chassis)
s1

Warehouse Casting and welding Paint shop

s2 raw (Body and Chassis)
(body & chassis)

s3
Final Assembly Transportation Inspection Factory
Warehouse

Warehouse (raw) Engine assembly

Heat Treatment

Paint shop

Manufacturing Plant Layout\

Infrastructure facilities:
• Bajaj Auto Ltd. has well designed infrastructure facilities with highly care of clarity and
arrangement.
• The whole plant has divisional area like, offices, operation house, go-down, and packing
department.
• Bajaj Auto Ltd. l has modern technological machines arranged in operation department
systematically.
• Bajaj provide all the best facilities to their employees, like parking, canteen, rest room, and
proper working conditions.
• They greatly care of their employees. They pay on monthly basis and give bonus on special
occasions.
 ASSEMBLY LINE LAYOUT
• Bajaj Auto Ltd. have modern and technologically advance machines and state of the art
assembly lines. These machineries are arranged in operation department systematically.
• The production process is step by step, the raw material moves from one line to another
line systematically
• Assembly line technology is for facilities that produce a narrow range of standardized
products

Manufacturing Process for two-wheeler and three-wheeler

Ms Castings & Crank case Misc. Alu Crank case Sheet Plates
Forgings Castings

Buffing and Heat Cutting to Size

Treatment

Machining Machining Buffing Electro plating pressing

Heat Treatment Wheel Assembly Weld/buff chassis

and Grinding forming

Bought out
Component

Minor
Assemblies

Engine Engine Testing Final Assembly painting Chassis forming

Assembly
Quality testing

Dispatch for Sale

INVENTORY MANGEMENT
• Bajaj auto maintains seven days inventory. Demand Estimations are based on Panel
Regression, which considers both time series and cross section variation in data.
• All the Mediators are connected with each other through IT linkage to know exact status
of delivery of goods
• With operations spanning to such vast geographies, managing a value chain globally
becomes more and more complex.
• In countries where Bajaj perceives a strong market potential, they establish a tie up with
one major industrial establishment eager to invest in the project.
• This investment may include setting up strategic manufacturing or assembly units, apart
from a well-established nation-wide network for marketing, distribution and after sales
services.
• These investors who form alliances with Bajaj Auto are termed as “Business Partners”.
Bajaj Auto offers a number of services to its business partners
They include:

• Training in sales, service and spare parts management based on the Bajaj distribution
system
• Active support for setting up manufacturing facilities overseas including transfer of
technical know-how
• Assistance in setting up an assembly plant for assembly of vehicles from complete knocked
down (CKD) kits
• Selecting of machinery and equipment and training of technical personnel, all in a phased
manner as required by the regulations in the recipient country
• Active support in setting nation-wide dealer network, also involving identification and
recommending suitable partner who would assist the distributor in Business growth
OE MODEL
Corporate Level Strategy:
Defined it in terms of brand identity, brand essence and brand values. The brand of Bajaj Auto
values learning, innovation, perfection, speed and transparency. Their goal is greater
organizational profitability, higher employee morale and greater customer satisfaction. For the
first twenty years of its history Bajaj Auto did not feel to introduce any new products and simply
kept changing with the old Vespa design because of its great demands. Those were the good old
days of Bajaj when they monopolized the market by manufacturing and marketing Piaggio’s
Vespa brand scooters and three wheelers in India. The technical collaboration with Italy’s
Piaggio & Co. expired in 1971.Using the Bajaj brand name the company continued to produce
and sell vehicles. In 1971, the company released three-wheeler goods carrier. In the year 1972,
Rahul Bajaj became the chairman of Bajaj Auto Ltd. He was Rahul Bajaj, who gave Bajaj Auto a
new height, a new way to proceed. After completing an MBA degree from Harvard University,
Rahul Bajaj took over the responsibility of Bajaj Auto in 1968. From then, Rahul had dreamt of
making his company the world’s leading manufacturer of two wheelers. Rahul wanted to see
Bajaj Auto Ltd. as world class in India. After coming out from the joint collaboration of Piaggio
& Co., Bajaj Auto Ltd. started to expand under the leadership of Rahul Bajaj. New models like
Bajaj Chetak, Bajaj Super, Rear engine Auto rickshaws, Bajaj M-50 came out between 1972 and
1981. In the mid-1980s the government liberalized the two-wheeler industry and the Japanese
MNCs like Honda Motors, Yamaha and Suzuki collaborated with various Indian business groups
and started business in India. Following the tradition, Bajaj Auto collaborated with another
Japanese auto giant Kawasaki and released models like Kawasaki- Bajaj KB100 in 1986 and
other models one by one. The new market competitors started to grab the market share of Bajaj
Auto because of their new and high-quality technology. Bajaj Auto Ltd. – the then Indian auto
giant changed its advertising tagline from “You just can’t beat a Bajaj” to a gentler and touchier
one “Hamara (our) Bajaj”. After the pollution act was passed by the government, Bajaj Auto
released another few new models before Rajiv Bajaj was gradually in the process of taking over
the leadership responsibilities from his father Rahul Bajaj in 1998. When Rahul Bajaj took over
the responsibility of spearheading the company’s products in 1996, he found that he had
inherited a lumbering giant- a legend, whose legacy needed a major overhaul. According to him,
the major challenges the company was facing were (1) Share in customer’s mind,
(2) Product differentiation,
(3) Customer satisfaction,
(4) Customer retention and
(5) Cost control.
To complete the transition of a new Bajaj Auto, Rahul emphasized to improve on the above
fields. His management team consisted of experienced stalwarts as well as new faces who had
been chosen for its specialist skills. Rajiv Bajaj’s priorities thus included accessing new
technologies, introducing new models, making a strong presence in the rapidly growing
motorcycle market, creating a marketing culture, revamping manufacturing practices, focusing
on quality, improving the supply chain and helping the new managers integrate into a
conservative corporate culture. Marketing strategy of Bajaj Auto is always one of its greatest
strength in its portfolio and their logo and ad line always tunes nicely with their intentions and
provoke people to be attracted to Bajaj Auto. In 1980’s ad line was ‘You Just Can’t Beat a
Bajaj’; in the mid-1990’s it was ‘Hamara Bajaj’; towards late 1990s Bajaj motorcycles claimed
to be ‘Unshakeable’ The new visual identity of Bajaj Auto emanates from the confirmation of
core values, which Bajaj has identified as its brand values. The Brand essence for the new Bajaj
has been defined as "Excitement". Excitement engineering will deliver and inspire confidence
into various stakeholders like Bajaj has traditionally done. Bajaj promises to live its essence
through a set of five Brand Values of Learning, Innovation, Perfection, Speed and Transparency.
The traditional hexagonal symbol has been replaced by an open abstract form of stylized B, the
"flying B" as it has been named represents style and technology. It also has a strong association
with the heritage of Bajaj since the external form has a hint of hexagon. "Flying B" form denotes
speed and open form denotes the transparency. Bajaj has adopted a new brand line of "Inspiring
Confidence". In whatever the company does it seeks to inspire confidence in its audience. The
new identity has a fresh new blue color. This blue represents the stability and strength of Bajaj.
Blue also represents high technology and precision engineering. The new identity presents a
futuristic face of the new global Bajaj. These are the corporate strategies which Rahul Bajaj
considered for transformation of a giant named Bajaj Auto Limited.
Business Level Strategy of Bajaj Auto:
In the long 64 years of its business life in India Bajaj Auto has changed its business level strategy
from time to time as it evolved through the difficulties of the demand of the market. In the very
early stage the company was in a joint technical collaboration with Italy’s Piaggio & Company.
Bajaj Auto then used to manufacture and market Piaggio’s Vespa Brand Scooters. For the first
20 years of its history Bajaj Auto didn’t feel to introduce any new product due to the great
demand of Vespa Scooters. As the agreement with Piaggio expired in 1971, Bajaj Auto launched
three-wheeler goods carrier in1971. In 1972 a new model named ‘Chetak ’was launched.
Thereafter came a timeline of new releases like Bajaj super, Bajaj M-50. After the two-wheeler
industry was liberalized Bajaj Auto collaborated with Japan’s Kawasaki Motors. Models like
Kawasaki-Bajaj KB 100, Bajaj Sunny were released. Bajaj Auto Ltd. has always targeted the
middle-class Indian to expand their market. When the global MNCs like Honda Motors, Yamaha
and Suzuki started their business in India by merging with various Indian business groups Bajaj
Auto felt an immediate threat. They changed their business tagline from ‘You just can’t beat a
Bajaj’ to ‘Hamara Bajaj’. In 1998, the environment became more complicated. Hero-Honda was
gearing up to contest Bajaj Auto’s dominance in the scooter market. There was a million-dollar
question to the managers of Bajaj Auto: What products should it make to dominate India’s two
and three-wheeler companies. In 1996, the major challenges the company was facing were (1)
Share in customer’s mind, (2) Product differentiation, (3) Customer satisfaction, (4) Customer
retention and (5) Cost control. To complete the transition of a new Bajaj Auto, the management
team gave priorities in accessing new technologies, introducing new models, making a strong
presence in the rapidly growing motorcycle market, creating a marketing culture, revamping
manufacturing practices, focusing on quality, improving the supply chain and to integrate into a
conservative corporate culture.
Distribution:

• For distribution of Bajaj auto it uses mix of depots and carrying & forward agents
• This is completely dependent on the distance of manufacturing location from dealer
point.
• For example, due to extensive distance from manufacturing plant from west Bengal to
north-east India, there exist a depot in Khadakpur with capacity of housing 800vehicles.
• There are similar depots in Punjab, Rajasthan and southern India.
Dealers:

CoCo
• Company Owned &
•Company Operated showrooms

CoDo
•Company Owned &
• Dealer Operated showroom

DoDO
•Dealer Owned &
• Dealer Operate
Transport & Logistics:
• This function of distribution is not owned by the company in any form.
• This is outsourced to the third-party vendors.
• The third party here is Transport Corporation of India (TCI) and a few other private
vendors.
• There are twenty vendors across India -JamunaTransport -SumitTransport