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Marketing Hazards

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MARKETING PROBLEM THE AUTOMOTIVE (SPECIALLY TRUCKING) INDUSTRY FACES WITH RESPECT TO ENVIRONMENTAL CONCERNS
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By AGNIVA SAHA Roll No 001 (PGDM-PT) 2012-‘15

* Introduction to TRUCKING INDUSTRY
TRUCKs are vehicles used only for commercial purpose. They are used in ports, mines, road transport. They are also used for different public utility purposes like fire engines, ALP (aerial ladder platform), pullers (ODC) etc. * They are being promoted by different manufacturers as high load carriers regardless of size and dimension. These machines are rated on their value of return on investment. * Owners only see ROI while owning these vehicles, leads to ruthless treatment of machines as well as the resources.

Introduction to MAN Trucks India Pvt Ltd

* German major MAN (Machinenfabrik Augsburg Nurnberg) started its Indian operations forging a joint venture with FORCE MOTORS, in 2007. The name being MAN FORCE TRUCKS PVT LTD.

* It surged to success in successive years and it became a competitor for existing biggies like TATA MOTORS, ASHOK LEYLAND and others. * Always been a little premium player of the market, catering to niche and more solvent customer belt with its quality approach to the market. * In 2011, MAN EU taken over 100% stake of Indian operations, resulted in exit of force motors from the venture. Company became MAN TRUCKS INDIA PVT LTD from April’2012 and launched its bus range called AIROBUS. “Inventing is indefinitely more beautiful than having invented”- Karl Benz * Making a new vehicle creates as much carbon pollution as driving those vehicles. * -------------------------------------------------
Environmental concerns due to production of vehicles, POLLUTION starts from there
Ores have to be dug out of the ground and metals get extracted. They are turned in to parts of the waiting to be rolled out trucks. * The carbon footprint of a medium spec truck under manufacturing is almost 25 tonnes CO2e. * Emission Effect:
CO2 contributes to the largest proportion to green house effect with 56%, even more than methane. Drought could be the obvious result.

* Trucks run on diesel and diesel engines are classified as CARCINOGENIC to humans. * Road and other modes of transport contribute to the 21% of the CO2 of total emissions. * Fuel contains Sulphur and Sulphur dioxide (SO2), NOx emissions are also there. Generate acid rain, harm fresh water, fish population, forests and vegetation.

Solution to reduce emission Voluntary offer by automotive manufacturers * Support and develop R&D for next generation fuel and production efficiency. * Stimulates demand of biofuels e.g. Bioethanol. * A smooth transition to Hybridization of vehicles, electrical engines. * Gas could be solution to this problem neglected source FOSSIL FUEL * The future of automobile propulsion HYDROGEN Effects on price and price effects on market

* Environmental concerns leads to more R&D and more alterations in the product, increasing cost. Price hike in subsequent times is obvious. It is where trucking industry or overall automotive industry is facing immense marketing issue. * Increasing prices affecting the industry in negative manner. As the market size and demand is not increasing as per expectation level of the manufacturers. “CHANGING THE DEMAND SIDE-THE REAL CHALLENGE”------ Dr. Thomas Schlick, VDA- Verband der Automobilindustrie * Customer mindset: another barrier “We must influence the market, not simply supply it with vehicles that people don’t want to buy”--- Dieter Zetsche, CEO of DaimlerChrysler AG Price Hike
Controlling CO2 emission and pollution Standard Enhanced compliance for engines Increase of oil price, search for alternate source Scarcity of oil fields, increased competition for crude oil AUTOMOTIVE INSTITUTE IN WITH RESPECT TO RELATION BETWEEN PRICE AND ENVIRONMENTAL PRESSURE TO THE AUTOMOTIVE INDUSTRY Commodity price increases Price Pressure Environmental Pressure Vehicle Assembler

Strategic Spending

Marketing
PROMOTIONS
Pensions & legacy
Incentives
Product proliferation Global Expansion Product Innovation
Innovation
Reactive Spending

Promotion

Market Orientation * Mining * Transportation 1. On-road 2. Off-road * Urbanization or construction Right here, problem rises where at one hand manufacturers promote these activities to sustain in the market. On the other adverse affects on mining and transportation waiting to intervene.

MINING

* Soil erosion * Formation of sinkholes * Loss of biodiversity * Contamination of surface water

WATER POLLUTION TRANSPORTATION

* Significant user of energy burns out petroleum resources the world contains within. * One of the most disastrous results of building roads is noted as URBAN SPRAWL (it’s a concept of building and expansion of low-density development) consumes natural habitat and agricultural lands nearby. HEALTH CONCERNS * Fatal effect on pregnancy. * Adverse effects on gestational duration and possibly intrauterine growth.

CONSTRUCTION OR
URBANIZATION

A curse to the ecosystem: * Degrading biomass or habitat weight per unit area. * Construction components like concrete, sand, stone and gas is spreading over surrounding environment, thus disturbing the ecobalance. * The hazardous compunds transforming organic substances through chemical reactions causing Degradation of ecosystems.

Mining, transportation and construction industries and companies into these industries determines place of a commercial vehicle to placed. Place of COMMERCIAL TRUCKS been decided by industry operationals like I. Real Estate Developers II. PLACE
Road and bridge contractors III. Mining contractors IV. Miners In any of the above cases the balance of ecosystem, public health, Environment and thus the all important carbon cycle is being affected everyday.

CONCLUSION:
Now the time has come for to control the pollutions above mentioned, by controlling ourselves, controlling our actions and way of behaving in coming days, ahead. And here comes the dilemma. We, in the truck industry, cannot promote control on these activities entirely to sustain in the industry, because everything is linked to everything. Solutions could be suggested in terms of: a) Regulated Mining b) Controlled road constructions and clipping of unnecessary real estate development. c) Stopping use of hazardous fuels, promoting biodiesel and biogas.
Strategies for reducing The Trucking Industry’s carbon footprint (recommended) * Reduce idling: Pursue a government solution to reduce discretionary idling through highway infra developments and through financial rewards from technology improvements.

* Fuel efficiency: Encourage fuel efficiency improvement through any program which encompasses the whole frieght and mining industry- miners, shippers, truckers, real estate developers, even dealer service centers and truck stops like weight machines and fuel pumps.

* Support national fuel economy standards: Setting technologically feasible fuel economy standards for heavy duty trucks can reduce fuel consumption if they don’t compromise performance of the vehicles.

INDUSTRY SHAPE

REASON | MAJOR GOALS OF THE INDUSTRY | THINNER PROFIT MARGINS | LESS INTEREST ON TECHNOLOGY IMPROVEMENTS AND MATCHING FUEL COMPLIANCE | ESCALATING FUEL PRICES | TRUCKS WITH INCREASED FUEL EFFICIENCY AND THUS MINIMIZING FUEL CONSUMPTION |

GOAL SHOULD BE “ Goals and aims coincide with the global need for industries to reduce their carbon footprint and to lessen their environmental impact.”

REFERRENCES:
WIKIPEDIA

Pwc

EPA United States Environmental Protection Agency

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