WHAT MG MOTORS NEEDS TO LEARN FROM THE JAPANESE

The automotive world since the early 1900s has changed dramatically with all kinds of manufacturing innovations. The Japanese shaped the manufacturing thought alongwith the Germans to give the world many an innovation not just in quality but also with delivery and service. Just in time (JIT) was the Japanese contribution to the world of management which ensured cost efficiencies as well as customer satisfaction.

In the 90’s I read a book written by Peter Senge called 5th Discipline which is a brilliant book on how a company must be ready with its product to meet consumer demand when there is a surge in sales.

Somehow MG missed management class and definitely ignored the Japanese and Peter Senge.

The auto market in India has been waiting with bated breath for both the new kids on the block i.e. MG HECTOR & KIA. Sales for all other cars tanked as people lined up to book either of these cars. In just a few weeks of bookings, both companies notched up over 30000 units as sales which is remarkable.

What isn’t remarkable is the fact that while MG collected Rupees Fifty Thousand (Rs.50000/-) as booking charges, they didn’t tell their customers when the car will be delivered to them. Furthermore, if newspapers are to be believed, both companies manufacture only 3000 vehicles per month. The first bookings would take at this rate atleast 10 months to deliver which is an insane wait for a car.

While all this brouhaha was taking place, Hyundai’s Creta continued to clock over 9000 units a month and they launched a junior Creta called Venue which clocked the same number. Deliveries on schedule, decent pricing and the Hyundai decades old network. Other cars like Honda WRV too did decent numbers of over 1500 units a month with no waiting for the car.

Peter Senge in his book talks about how notching up sales without being prepared is to no avail as the enthusiasm for the brand will die down and the spike in sales without the ability to deliver the product leads to cancellations, resentment and hardly any additional sales to compensate for the campaign. Negative conversations that ensue lead to a lot of potential customers deciding against buying the product and it is moreso in the premium segment, especially in a country like India.

What MG should have done with all their launch fanfare is create an exciting followup campaign with their customers to keep the excitement going. Like a countdown if you may on when the car would be delivered and maybe throw in a small waiting gift till the delivery completed. 

Raj Kaushik – Vitarkka

One thought on “WHAT MG MOTORS NEEDS TO LEARN FROM THE JAPANESE

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  1. The total pending bookings currently stand at more than 30,000 units. The carmaker recently rolled out the 10,000th unit of its Hector SUV off the assembly line at its Halol plant, in about four months since it began operations in India.MG has started the second shift at its manufacturing unit from today November 1st. The addition of the second shift is expected to boost its assembly capacity to up to 3,500 units per month from 2,500 units as of now. According to the company, the average waiting period per customer stands at 3-4 months currently. At present, there are 15,000 customers on the priority waiting list and they will be provided preference while booking Hector. MG Motor India had sold 1,508 units of Hector in July and 2,018 units in August, 2608 units in September, last month, which ended with October 31, the company retailed a total of 3536 units which shows the growth rate in production as well as delivery. They have started a program in which waiting period-linked initiative called ‘Worth Waiting For’, wherein the SAIC Motor Corp-owned carmaker would sponsor the education of one girl child for every two weeks of waiting period borne by its customers. MG Motor India has so far sponsored the education of more than 35,000 girl children, under the initiative. It’s a new entrant in the Indian market and will take some time for settlement we have to appreciate them for their work rather than suppressing it, thankyou.

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