ANAND AGARWAL

PGDM-RM (2014-16)
SWOT ANALYSIS OF TANKER TRUCK SEGMENT IN MUMBAI AND SUGGESTING
MARKETING STRATEGY
FOR
MAHINDRA TRUCKS AND BUSES DIVISION

OBJECTIVE
Mahindra trucks and buses division (mtbd) is a new entrant in the tanker truck
segment of the heavy vehicle operations. Earlier this company was known as
mahindra navistar, which was a joint venture formed in 2005, between navistar
international (49%) of the united states and indian automobile maker mahindra
& mahindra (51%).
In 2013 this jv was called off and mahindra purchased navistars stake to form
mahindra trucks and buses division as a separate organization under mahindra
and mahindra ltd.
Untill now the sales operations of mahindra trucks and buses division were
restricted to normal load haulage trucks. But now mtbd has expanded its
operations in the fluid haualge segment (tanker trucks) with a full range of heavy
vehicles. The market is completely dominated by tata trucks and ashok leyland.
Bharat benz has also emerged as a promising prospect in the past few months.
In the wake of these challenges mtbd aspires to carry forward its legacy in the
passenger vehicles segment into the heavy vehicles segment. Hence they want
to know what are the key touchpoints where they can improve and provide a
better prospect to customers.
The customers of heavy vehicles are freight carrier companies, transport
agencies and industries like chemicles, explosives, petroleum products, edible oil
companies etc. They are very keen on the performance and return on investment
factor for buying a heavy vehicle.
This project is a segment analysis study which focusses on finding out what are
the customer needs, the issues and problems cistomers face and mark out areas
where mtbd can address their issues. The report also presents a swot analysis of
the tanker truck segment and focusses on developing a marketing strategy for
the offerings of mtbd and how these offerings can prove to be the most
profitable business asset for the customers business.
Another key aspect of this project is studying what the competiton is doing. Tata
and ashok leyland are big and established names of the heavy vehicles
manufacturing industry. Untill the start of 2015, tata never had a sales team on
field to sell its trucks. The transporters also had unwaivering trust in these
brands. But since the past 2-3 years the trucking business in mumbai and around
has seen a slight shift in equllibirum as new players in the market actively
started marketing their products,transporters, in lure of better profits and
techonolgy, have started including these vehicles in their fleet on an
experimental basis and seem to be quite satisfied by the performance. Mtbd
feels this shift in the status quo can prove to be the foot in the door opportunity
that can be the foundation stone for writing their success story.

ANAND AGARWAL
PGDM-RM (2014-16)

RESEARCH METHODOLOGY
It wasnt easy to go forward with one kind of research approach for this kind of
market. Initial attempts to gather relevant information through questionnaires
proved to be futile as customers didint respond well. Sometimes they were short
on time and sometimes actually refused to fill in the questionnaire. Prima facie, i
found the market to be very fratcured and highly competitive. Geographical
dispersion of respondents also made it very cumbersome to collect information.
Hence a comprehensive research schedule was devised for the same.
Firstly we identified areas where the tanker truck operaters were located. After
that we earmarked specific days of the week to visit specific areas. The sales
team fixed up appointments with the customers in a particular area on particualr
days.
DAYS
MONDAY
TUESDAY
WEDNESDAY
THURSDAY
FRIDAY
SATURDAY

NO. OF TRANSPORTERS
INTERVIEWED
NO. OF BANKS & FINANCIAL
INSTITUTIONS INTERVIEWED
COMPETITORS INTERVIEWED

AREA
CHEMBUR (AZIZBAUGH, SHANKAR
DEVAL)
SEWRI (GHASLET BUNDER AREA)
WADALA TRUCK TERMINAL
VASHI (SECTOR 90C, APMC
MARKET)
CHEMBUR (GAWANPADA)
FIELD RESEARCH ON COMPETITORS
/ MEETING WITH MENTORS VASHI
OFFICE
103
4
3

The information was collected by a series of interviews over a 50 day period. It

wasnt possible to capture the entire information in one meeting, hence i had to
meet every transporter available multiple times. Apart from this a detailed study
of competitors in the market was done.
CONCLUSIONS

The Indian truck industry is at the point from where it can see whats in the
future. Mahindra needs to find its place in that picture. With giants like Tata
motors and Ashok Leyland polarizing the market in their favour, its not going
to be an easy task. Strict decisions need to be taken and I think Mahindra has
already realized the importance of this time. Their decision to absolve the

ANAND AGARWAL
PGDM-RM (2014-16)

joint venture came at a point where foreign players lie Daimler and Volvo
were setting shop in India. The strategy of self-reliance and innovation will
start paying dividends in some time. The customers also are speaking well of
Mahindra as a brand but want to wait and watch its performance before
committing fully to it. So till then Mahindra needs to work on these small
areas which will eventually prove to be its stepping stones to success.

SUGGESTIONS

STRENGTHEN
PRICING
CAPABILITIES
The pricing competency is a
major issue that needs to be
addressed. The customers
are very cost-centric in terms
of initial investment and total
cost
of
ownership.
The
operating
costs
for
transporters are rising day by
and day and the competitors
give huge discounts to lure
the customers. In the wake of
these scenarios and being a
new player in the tanker
truck
segment
Mahindra
cannot afford to have its
trucks priced at a premium
that its competitors.

UTILIZING ADVANCE PRICING

ANALYTICS
SEGMENT BASED PRICING
ENSURE ORGANIZATIONAL
ALIGNMENT

ALIGNING THE PRODUCT

STRATEGY
The product strategy of
Mahindra after the absolution
of the joint venture with
Navistar international has

been very clear. They want to

promote their brand through
a home grown, familiar brand
of product which has all the
world class features and has
the Mahindra promise. But
somehow this strategy hasnt
worked for them as well as it
has worked for players like
Tata motors. So clearly the
market
now
demands
something extra apart from
just the product.

MANAGE VEHICLE LIFECYCLE

INNOVATION
INTRODUCING VALUE-LINE
PRODUCTS
ENHANCE COMPETITIVE
ANALYSIS

UTILIZE
DELAER
AND
CUSTOMER INCENTIVES
The
Indian
automobile
market is witnessing a surge
in competition and intense
demand cyclicity with huge
pressure on margins. The
impact of this is particularly
severe on the dealerships,
who are even passing on
discounts to the customers at
the cost of the dealer
margins in an effort to retain

ANAND AGARWAL
PGDM-RM (2014-16)

market share. And despite

volumes rising in specific
segments,
the
disproportionately
high
efforts in selling/ servicing is
seeing dealer profitability
being severely eroded. And
to make matters worse, the
lack
of
career
or
compensation
growth
in
dealerships is driving away
good talent who could have
offset
the
industry
challenges.
Dealers are at a critical
inflexion point today and
need heightened strategic
interventions. Dealers need
to drive strategic direction
setting
and
explore
diversification opportunities.
At the same time, they need
to work closely with the OEM
to chart out their segment
specific growth requirements,
skill set enhancement plans
and
operational
improvements.
This
will
require significant time and
effort from the dealers. As
dealers are critical customer
touch points, the OEMs will
also need to support them
with time and re-sources in

this initiative. Commitment

and maturity shown by the
dealers will be critical in
order to derive sustained
benefits over an extended
period of time, help them
break the growth ceiling and
maintain their viability in an
increasingly
competitive
market.

DEVELOP LOYALTY PROGRAMMES

END-CUSTOMER CAMPAIGNS
PROVIDE DEALER INCENTIVES

IMPROVE DEALER MARKET

SHARE
Dealerships will need to
adopt a holistic approach
that aligns their strategic
plans, organization structure
and
processes,
people
capabilities
and
business
processes
to
drive
and
enable growth.

STRATEGIC GROWTH

OPERATIONAL EXCELLENCE
ORGANIZATION EFFECTIVENSS