Toyota Motor Company (TMC)

Done by: saif Walid Tou

Wassim Ayham Assaf
Tareq Maher Al-Dawodi

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 Table of Contents
Introduction History …………………………………………… 3

Vision and mission ……………………………………………. 3

Goals and Objectives …………………………………………. 4

Swot analysis ………………………………………………….. 4

Firms financial condition ……………………………………… 5

Toyota's goals and objectives ……………………………….. 6

Toyota's strategy ……………………………………………… 6

Toyota's main competitors …………………………………… 7

Ford's strategy ………………………………………………… 7

GM's strategy…………………………………………………… 8

Honda's strategy ………………………………………………. 8

Recommended strategy ……………………………………… 9

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 Introduction (History)
By the end of the nineteenth century, Japan's first power loom was
invented by Sakichi Toyoda, revolutionizing the country's textile
industry. In January 1918, Toyoda created the “Toyoda Spinning and
Weaving Company”, and with the help of his son, Kiichiro Toyoda,
Sakichi was able to reach his lifelong dream of building an automatic
loom in 1924.

Kichiiro then was introduced to the automotive industry in the 1920`s,

throughout his visit to Europe and the United States Of America, and
was able to invest in the £100,000 that Sakichi Toyoda gained for selling
the patent rights of his automatic loom, and established the foundations
of Toyota Motor Corporation, in 1937.

Kiichiro developed a unique production system at Toyota Motors

Corporation (TMC), named the "just- in-time" philosophy" which means
producing only limited quantities of already ordered items with
minimum waste.

This philosophy was adopted by the automotive industry around the

world.

Rising from the ashes of industrial upheaval in post-war Japan, the

largest vehicle manufacturer in Japan was simply Toyota with over 40%
market share. Throughout the late 1950's, Toyota's inroads reached the
foreign market.

Vision:
“To be the most respected and successful enterprise, delight customers
with a wide range of products and solutions in the automobile industry
with the best people and best technology.”

Mission:
Mission of Toyota is to provide safe & sound journey. Toyota is
developing various new technologies from the perspective of energy
saving and diversifying energy sources. Environment has been first and
most important issue in priorities of Toyota and working toward creating
a prosperous society and clean world.

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Goals and Objectives:-
Toyota's goals at the end of 2013 is to go back-to-basics
1- Refocus on human resource development
2- Better product and innovative manufacturing.
3- Stable base of business
4- Enriching live of communities

Swot analysis

Strengths
1. innovative culture: Toyota is one of the best corporations in the
field of innovation and has a culture that is strongly focused on
continuous innovation. The company was the first to use total
quality management systems in their organization, and the first to
produce and sell hybrid cars.
2. Brand reputation valued at $30 Billion: Toyota vehicles are sold in
More than 170 countries because it is environmentally friendly,
safe and durable.
3. Strong brand portfolio: Toyota has a powerfull brand name wich
allows it to sell 70 different models of cars therefore the brand
awareness increases as well as the satisfaction of nearly every
consumer group needs (flagship models: corolla, prius).
4. The leader in "green" cars development: Toyota recognizes that
the market demands environmental friendly cars nowadays,
consumers are more selective in terms of CO2 emissions and fuel
efficiency of the cars the buy.

Weaknesses:

1. Large-scale recalls: over the past few years Toyota had large-
scale vehicle recalls. The business recalled 9 million vehicles in
2009-2010 and 7.43 million cars in 2012. Recall affects the firm
negatively financially and damages firm's brand.
2. Weak presence in the emerging markets: Japan, US and
Europe are the main markets for Toyota but as for the emerging
economies as China or India make only small percentage of
Toyota's sales. GM already has big market share in China
(largest automobile market) and it will be very hard for Toyota
to compete.

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Opportunities:
1. Positive attitude towards "green" vehicles: The awareness of
consumers is increasing towards air pollution caused by cars. As
it impacts the life on earth negatively consumers prefer to buy
new hybrid and electric cars with less CO2.
2. Increasing fuel prices: the continuous increase of fuel prices
created a strong market for Toyota hybrid cars.
3. Changing customer needs: To satisfy more customer groups
Toyota can introduce new car models.
4. Growth through acquisitions: In order to gain new skills, assets,
and access to new markets Toyota should consider acquiring
other car companies as it did in the past.

Threats :
1. Decreasing fuel prices: decreasing fuel prices will reduce the
need for hybrid cars.
2. Rising raw material prices: As raw materials are the main
components of the car manufacturing industry the increase of
their prices will definitely decrease the net income.
3. Intense competition: Nowadays the competition is intense
between car manufacturers for example VW is growing strongly
and GM are becoming more competitive than ever.
4. Natural disasters.

Firms financial condition:-

as of January 2014, Toyota is the fourteenth-largest company in the
world by revenue. In 2012 the largest automobile manufacturer in
production was Toyota. In July 2012 Toyota celebrated the production
of its 200-millionth vehicle. Toyota is the world's first
companythatproduces more than 10 million vehicles per year. It did
so in 2012 according to OICA, and in 2013 according to company data.
As of November 2013, Toyota was the prime listed business in Japan
by market capitalization (value more than twice as much as #2-ranked
SoftBank) and by revenue.

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Toyata's goals and objectives:
Toyota’s corporate goal is to keep its position as a market leader in the
automotive industry and to maintain its growth, while enhancing
profitability and shareholder returns.

Toyota’s Strategy
In order to achieve this corporate goal, Toyota struggles to enhance
its technology, production and marketing, supported by improvements
in quality control, strengthening of cost-competitiveness and personnel
development. Among these, technology is the vital element of growth.As
environmental awareness continues to grow in the market, Toyota is
improving its unique hybrid technology in order to develop
environmentally-friendly products.
Toyota realizes that it should satisfy specific needs of each region
in order to expand globally. The following factors are the reason of
Toyota's growth in the United States, Japan and Europe and its overall
position as one of the world largest automobile producers:

• its timely introduction of new products that meet consumer

demands and incorporate superior design and environmental and
safety technologies.

• its continuing focus on manufacturing high quality products at low-

costs.

• its commitment to investment in research and development and its

sales and production infrastructure.

• its financial strength, which enables Toyota to achieve the above

objectives.

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 Below are Toyota's main competitors:

TM F GM HMC
Market Cap: 179.08B 64.95B 55.38B 63.31B
Employees: 338,875 181,000 219,000 N/A
Qtrly Rev Growth
(yoy): 0.13 0.01 0.01 0.13
Revenue (ttm): 252.04B 147.14B 155.95B 116.34B
Gross Margin (ttm): 0.19 0.12 0.11 0.26
EBITDA (ttm): 34.76B 11.21B 10.95B 11.72B
Operating Margin
(ttm): 0.09 0.03 0.03 0.06
Net Income (ttm): 17.88B 6.53B 3.03B 5.64B

F = Ford Motor Co.

GM = General Motors Company
HMC = Honda Motor Co., Ltd

Ford:-

Ford’s business strategy is embodied in our ONE Ford plan. ONE Ford
enlarges on our Firm’s four-point business plan for accomplishing
success internationally. The four-point business plan consists of the
following:

 Changing the model mix and restructure aggressively to operate

profitably at the current demand.
 Hasten theimprovement of new products our consumers want and value
 Improve our balance sheet and finance our plan
 Work effectively together as a team

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GM :-
General Motors develop strategies that will help maintaining and
increasing its market share, these strategies are as follows:

Position itself in emerging markets:

General Motors has declared last month its plan of spending $500
million in Brazil to finance the manufacturing of small cars for that
country as well as other countries including Argentina and Paraguay.
The automaker is also hoping to expand the region's product
development center.

General Motors' division in Latin America, Africa and Middle East has
launched 17 new products last year and for this year.

GM is implementing it is launching a redesigned Chevrolet Malibu

equipped with quality Chevrolet catalytic converter to compete with
Toyota's Camry.

General Motors will also spend $100 million for the promotion of the new
Malibu but still industry observers are doubtful that an expensive ad
blitz can turn things for the Malibu.

Raise market share .1

percentag

Acquisition of other car manufacturers:

Such as the acquisition of Daweo Motors.

Honda:

Huge investments in R&D. Honda spends 5% of its revenues on R&D to

achieve competitive advantage through various technologies the
business relies on these investments, such as painting the vehicle in an
improved processes,new welding technologies or newhydrogen and
hybrid engines. In 2012, the company possessed 42,000 patents and had
pending requests for 29,000 more patents.

Strong brand image. Consumers are aware that Honda produces the
best quality engine around the world. The company’s brand was valued
at $17 billion wich is the 21st most valuable brand in the world and was
only behind Toyota, Mercedes-Benz and BMW, according to Interbrand.

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Recommended strategy:

According to the low market share for Toyota pickup trucks our
recommended strategy is to develop a new truck that can compete with
Toyota’s rivals to increase the market share. At Toyota they are aware of
this fact so they plan to collaborate with ford to produce a new truck
that will compete with GM and Dodge ram 1500.

In order to implement this strategy, Toyota should innovate a new

technology that allows them to produce new hybrid trucks. Now to
implement this strategy Toyota will put a lot of money and energy to
produce these trucks so the cost of this truck will increase as well as its
price in comparison with other trucks, to overcome this obstacle Toyota
should build a strong marketing strategy makes people aware of the fact
that they will save money on the long run because the fuel consumption
will be lower. For example instead of paying $1000 every month for fuel
you only pay an extra $10,000 and buy Toyota’s new hybrid truck.

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 References

http://www.strategicmanagementinsight.com/mission-statements/toyota-
mission-statement.html

/http://www.toyota-indus.com/corporate/company-profile/vision-mission

http://en.wikipedia.org/wiki/Toyota

http://www.gm.com/company/investors/corporate-strategy.html

http://www.wikinvest.com/stock/Toyota_Motor_(TM)/Toyotas_Strategy

http://www.streetdirectory.com/travel_guide/51055/cars/general_motors_gr
owth_strategy.html

http://corporate.ford.com/microsites/sustainability-report-2012-
13/blueprint-strategy

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