Maruti Udyog Limited: Industrial Analysis and Policy

Abstract

Maruti Udyog Limited is the locus of a major technology transfer effort, involving the upgradation of India's tiny and antiquated automobile industry, with Japanese technology, currently the latest in the field. In the process three types of issues have arisen. The first set relate to the transfer of both, the hard and soft, Japanese technology to the Indian environment. However, for successful transfer, Maruti Udyog needs to evolve a coherent corporate strategy. Therefore the second set revolves around the question: What role should the company expect to play in the Indian automobile industry? Thus a felt need has arisen for an integrated national policy towards the automobile industry, generating the necessity to deal with a third set of policy?related issues. Technology transfer on the scale envisaged has generated public controversies about matters such as foreign investment, industrial protection, foreign exchange shortages, fiscal actions, energy consumption, air pollution, purchasing capacity, employee skills, etc. The case is intended to provide a basis for discussing public industrial policy and related issues of corporate strategy and manufacturing policy.