Themain objective of the study is to discuss the international marketingstrategies used by Honda Group to enter into Pakistani Automotive Car Marketfrom 1992 to 2016 and the retrospective recommendations of what internationalmarketing mix strategies to be applied by the company especially after nongrowing trend in their market share and upcoming threat of new internationalentrants into the market.
The automotive industry of Pakistan is a growing industry controlledby Japanese manufacturers, namely, Toyota, Suzuki, and Honda allhave assembly plants and all co-owned with local partners. By a large margin, Honda is the preeminent engine maker inthe world with an output of more than 20 million internal combustionmotors annually; Honda vehicles are the most durable and long-lasting ofany automaker, with 75% of its cars and trucks sold in the last 25 yearsstill on the road (Rothfeder 2014). Honda Atlas Cars is a joint venture between HondaMotor Company Limited, Japan and the Atlas Group, Pakistan.The company was incorporated in 1992 and since then, the company has developedtwenty five 3S dealers (Sales, Service and Spare Parts) fifteen 2S dealers(Service and Spare Parts) and six 1S dealers (Spare Parts) network in all majorcities of Pakistan (Business Recorder 2017). Honda has always looked to international markets asopportunities which have helped the company to plan its production andtechnology from the start and viewed the rest of the world as potentialcustomer base.
While entering into the Pakistani market, the company targetedthe growing middle class and upper class section of the population with highincome earnings along with premium and market skimming price settings. In terms of Automotive Car Market, Suzuki (33%) and Toyota (28%)have grown faster and have high market shares than Honda (25%) (Hembel,nd).Honda, being a Global company and being a steady grower in local PakistaniAutomotive Car Market is facing the threat of decreasing market share fromexisting competitors and from new international entrants. Likewise, in terms of Pakistani AutomotiveMotorcycle Market, Honda has turned the tables and has a growing market shareof more than 50%, leading the motorcycle industry with the adaption of more localizedmarketing strategy, wider target market and different market mix strategy.
In view of this, this termpaper will bring a case study about thechallenges and opportunities faced by the Honda Motor Co. while entering intothe Local Pakistani Car Market and adopting to the public, differentinternationalization strategies applied by the company to enter and gain stable competitive position in this marketduring 1992-2016, and finally the recommended International Marketing Mix Strategiesthat should have been applied retrospectively by the company to become the growingcompany in Pakistan’s Automotive Car Market.2.ChallengesThere were many challenges and opportunities facedby the company when it was entering the Pakistani Automotive Market startingfrom 1992. I will briefly discuss some of the salient features below:2a. Macro and Micro Analysis Following are the external challengesfaced by the company before entering the local market and how Hondastrategically converted them for their benefit: