PESTEL Analyis

Govt policy

 As of June 2021, Rs. 871 crore (US$ 117 million) has been spent under the FAME-II scheme, 87,659 electric
vehicles have been supported through incentives and 6,265 electric buses have been sanctioned to various
state/city transportation undertakings.
 In July 2021, India inaugurated the national automotive test tracks (NATRAX), which is Asia’s longest high-
speed track to facilitate automotive testing.
 In Union Budget 2021-22, the government introduced the voluntary vehicle scrappage policy, which is likely
to boost demand for new vehicles after removing old unfit vehicles currently plying on the Indian roads.
 In February 2021, the Delhi government started the process to set up 100 vehicle battery charging points
across the state to push adoption of electric vehicles.
 The Union Cabinet outlaid Rs. 57,042 crore (US$ 7.81 billion) for automobiles & auto components sector in
production-linked incentive (PLI) scheme under the Department of Heavy Industries.
 The Government aims to develop India as a global manufacturing centre and a Research and Development
(R&D) hub.
 Under NATRiP, the Government of India is planning to set up R&D centres at a total cost of US$ 388.5
million to enable the industry to be on par with global standards.
 The Ministry of Heavy Industries, Government of India has shortlisted 11 cities in the country for introduction
of EVs in their public transport systems under the FAME (Faster Adoption and Manufacturing of (Hybrid) and
 Electric Vehicles in India) scheme. The Government will also set up incubation centre for start-ups working in
the EVs space.
 In February 2019, the Government of India approved FAME-II scheme with a fund requirement of Rs. 10,000
crore (US$ 1.39 billion) for FY20-22.

Economics

 In August 2021, Hindustan Zinc Ltd. announced a US$ 1 billion investment across its eight
mines to replace diesel-powered trucks and equipment with battery EVs
 Between January and July 2021, EV component makers, electric commercial vehicles and
last-mile delivery companies invested a total of Rs. 25,045 crore (US$ 3.67 billion) on electric
vehicles.

 A cumulative investment of ~Rs. 12.5 trillion (US$180 billion) in vehicle production and
charging infrastructure would be required until 2030 to meet India’s electric vehicle (EV)
ambitions.

 In April 2020, TVS Motor Company bought UK’s iconic sporting motorcycle brand, Norton,
for a sum of about Rs. 153 crore (US$ 21.89 million), making its entry into the top end
(above 850cc) segment of the superbike market.

 In March 2020, Lithium Urban Technologies partnered with renewable energy solutions
provider, Fourth Partner Energy, to build charging infrastructure across the country.

 In January 2020, Tata AutoComp Systems, the auto-components arm of Tata Group entered
a joint venture with Beijing-based Prestolite Electric to enter the electric vehicle (EV)
components market.

New labour laws

Working hrs 9 to 12, minimum wage, health benefits to unorganised sector

Porter 5 force model

Threat of new entrant

Entry barrier is high,

Huge investment required,

biggest challenge is setting up sales and service center

well established players , consolidated/strong industry

Threat of substitutes

high

Flexibility in tranportation

Bus, cars, public transportation

Industry rivalry

High

Price,quality plays an imp role

Methods to attract customers discounts, low interest rates long term warranties
Changing models frequently for differentiation

Bargaining power of supplier

low

Steel , batteries , tyres multiple domestic and international suppliers

MRF, CEAT, Goodyear,

Bargaining power of buyers

High

5,6 popular brands

People go for good service

SWOT Analysis

Strengths 1.

The domestic market is very large.

2. The Government helps the companies by providing monetary

assistance for the manufacturing units that are set up.

3. Labor cost is low.

4. The growth of the economy has led to increasing purchasing

power of the customers.

Weakness

Regulations, taxes increasing cost of production

Infrastructural setbacks

Low investment in R&D

Opportunities

Emerging market Asian and BRIC , EV segment

Premium segment royal enfield, jawa , honda

Increase in rural demand

Threats

Entry barrier is high due to high investment and sunk cost

Sluggish economy: Macroeconomic uncertainty, recession, unemployment, etc. are the economic

factors which will daunt the automobile industry for an extended period.

 1945: Bajaj Auto is founded as M/s Bachraj Trading Corporation Private Limited

 1960: Rahul Bajaj becomes the Indian licensee for Vespa scooters.
 1970: Bajaj Auto manufactures its 100,000th vehicle.
 1984: Work begins on a second plant.
 1986: 500,000 vehicles produced and sold in a single financial year.
 1995: Bajaj Auto Ltd. celebrates its golden jubilee.
 1998: Production begins at the Chakan plant.
 2001: The iconic Pulsar is introduced.
 2003: The Pulsar DTS-i is launched, with 107,115 vehicles sold in a single month.
 2009: The upgraded Pulsar 150 and 180 introduced
 2010: Bajaj Auto launched a 135 cc Pulsar, pushing the Pulsar brand into the
mass segment.Bajaj Auto has given the Bonus in the Ratio of 1:1
 2011: Bajaj Auto - Bajaj records its best year ever.
 2012: Bajaj Auto has tied up with Japan’s Kawasaki in Indonesia.
 2013: Bajaj Auto plans to export Discover 100T motorcycle.
 2014: Bajaj Auto bags order in Sri Lanka.People's Choice Bike of the Year award.
 2015: Bajaj Auto has introduced the all-new Platina electric start 100 cc bike to the long-
distance commuter.
 2016: Bajaj Auto unveils bike containing metals from INS Vikrant.
 2017: Bajaj Auto and KTM to globally roll out Husqvarna Motorcycles.
 Below are the Strengths in the SWOT Analysis of Bajaj Auto Limited:
1. Excellent brand presence and marketing in India make Bajaj Auto
popular company
2. Extensive research and development focus and highly experience
Bajaj Auto Limited player in the motorcycle segment
Strengths 3. Widespread distribution network of Bajaj Auto across India
4. Bajaj Auto has a wide product range in terms of price, quality and
categories
5. Featured in the Forbes Global brands list
6. It has more than 9000 people employed in the organization

Here are the weaknesses in the Bajaj Auto Limited SWOT Analysis:
Bajaj Auto Limited 1.Bajaj Auto is still not a global brand despite high volume production
Weaknesses 2.Lack of performance bikes like major international brands and spor
bikes & cruisers

Following are the Opportunities in Bajaj Auto Limited SWOT Analysis

1. Bajaj Auto says its $2,500 car, which it is building with Renault and
Bajaj Auto Limited Nissan Motor, will aim at a fuel-efficiency of 30 km per litre
Opportunities 2. Cheaper variants for tapping more in the rural segment
3. Premium sports bikes for urban areas
4. Constant growth in the two-wheeler segment

The threats in the SWOT Analysis of Bajaj Auto Limited are as

mentioned:
Bajaj Auto Limited 1. Cheaper imports from countries like China can affect business for
Threats Bajaj
2. Entry of international brands
3.Other motorcycle players have a strong brand presence

Bajaj Auto Limited Competition