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Competitive advantage of Toyota
Introduction of Toyota
Introduction of Toyota
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Introduction
Toyota has been well-known for long time as the one of the best motor companies in the world. In Thailand, Toyota’s cars are very popular. Moreover, Toyota Service Center has many branches and located all over Thailand. I am interested in Toyota Company because I heard about this company since I was born. Therefore, I would like to do research on Toyota Motor Corporation to learn and understand more about what makes Toyota such a successful company.
General Information and History
Toyota Motor Corporation is a Japanese car company. It operates 75 manufacturing companies globally and markets vehicles in more than 170 companies. Its brands include the Lexus, Prius, Avensis and Auris (“Company”, n.d.).
This company started when Sakichi Toyoda built Toyota Model G Automatic Loom in year 1924. However, its patent was sold to British Company. In year 1933, Automobile Department was established in Toyoda Automatic Loom Works, Ltd. In year 1937, Toyota Motor Corporation was founded and expanded the business later on (“History of Toyota”, n.d.).
Toyota Company’s head office is in Toyota City, Japan. The present President and Representative Director is Akio Toyoda. The main business activities are motor vehicles production and sales (“Toyota Motor Corporation”, n.d.). Last year net revenue of Toyota Motor Corporation is 283.5 billion yen (“Toyota Motor Corporation”, n.d.). Additionally, Toyota Motor Corporation has expand in over 170 countries around the world (“Globalizing and localizing”, n.d.).
Marketing/Image
Now Toyota Motor Corporation has expanded their market around the world, covering 170 countries (“Globalizing and localizing”, n.d.). According to the policy of Toyota vehicles, “Producing vehicles where the demand...
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...ding Toyota vehicles. A Chinese man said that he did not care about brands, but he would not buy Japanese cars (“Open prejudice”, 2013). However, despite large recall and conflict with China, Toyota had the highest sales with 9.75 million vehicles in 2012 (“Toyota back”, 2013). This indicates that Toyota can go further and customers still need Toyota vehicles.
Summary
Toyota Motor Corporation is one of the most successful automobile companies. Because of Kaizen, Toyota never stop create the best product to fulfill customers’ needs. The company is able to extend its market over 170 countries, which indicate that people accept Toyota brand. Although Toyota has to recall many cars for fixing, the total sales of the company are still being the best among other competitors. Car users still believe in current and future products of Toyota, including all green vehicles.
Lexus is the luxury vehicle brand which is the division of the Toyota Motor Corporation. Lexus was launched in the year 1989 and introduced first in US. Now Lexus is sold all over the world. Lexus was founded by Eiji Toyoda. Lexus is now sold in more the 70 countries and regions globally, and now it is graded among the 10 largest Japanese brand which are traded globally. The headquarters of Lexus is located in Nagoya, Japan. And the functional centers are situated in Belgium, Brussels and Torrance, USA and California. Lexus brand is considered as a premium brand. Lexus has been a successful brand and is performing impressively currently. Over 490,000 Lexus vehicles are sold and 60% of the sales happening worldwide is in North America.
Toyota- focused differentiation, medium pricing, breadth of product line is low. Company is known for quality products, and nice styling.
The HRM strategy in Japanese companies is supported by the six pillars of Japanese employment practice lifetime employment, company welfare, quality consciousness, enterprise unions, consensus management and seniority-based reward systems. Toyota is at the heart of global manufacturing, a company that has grown over 70 years to become the world's third largest vehicle manufacturer. (Toyota worldwide 2006) Toyota is the seventh largest company in the world and the third largest manufacturer of automobiles, with production facilities in 26 nations around the world employing more than a quarter of a million people. The decision to manufacture in Europe was based on a corporate policy of building vehicles where the customers are and The United Kingdom was chosen for many reasons including its history of vehicle manufacture, the large domestic automobile market, its components supply base and its excellent links with the rest of Europe.
According to Toyota, they have undertaken a manufacturing revolution that has fundamentally changed established practices; all the way back to the product development and design. They have done this by integrating four areas: design, production engineering, procurement, and component supply. They have achieved higher quality at lower costs by creating standardized, multipurpose components. Also the reduction in cost has heightened the value and fortifies the competitiveness of product. To do this, Toyota has required intensive coordination with its suppliers. Another factor of their Integrated Low Cost is that Toyota steadily feeds cost improvements back into the product to raise their value along with the fact that four Toyota’s seven corporate auditors are outside corporate auditors.
Toyota Motor Corporation is a Japan based company, whose headquarters are located in Aichi Prefecture. The company was founded by Kiichiri Toyoda in 1937. Currently the company’s CEO is Akio Toyoda. Toyota is basically into cars and it is one of the top players in the world in this industry. Toyota also owns two other brands namely Lexus and Scion, which gives the company a lot of advantage over it’s other competitors. Toyota manufactures sedans, saloons, suvs, muvs, pick-up trucks and buses. During the year 2013 Toyota had approximately 333,498 employees, who were working globally. In March 2013, Toyota was ranked as the thirteenth biggest organization globally in terms of its revenue. In the following table we can see the financial report of Toyota Motor Corporation in the year 2013-
(5) Liker, Jeffrey K. The Toyota Way: 14 Management Principles from the World's Greatest Manufacturer. New York: McGraw-Hill, 2004. Print.
For over fifty years, Toyota has established over 50 bases in 26 different countries and regions. Their automobiles have found their way into over 170 countries across the entire globe. In addition, Toyota has design and R&D bases in nine locations overseas, with this they prove that they have achieved consistent globalization as well as localization. The most important part in any Toyota base is the quality assurance. They don’t stamp their product with “Made in the USA” or “Made in Japan”, but instead opt for one label for all: “Made by TOYOTA.” This shows that the product is made in the “Toyota Way.” To achieve this, the company minimized support that comes from Japan to let each of their foreign locations become self-reliant. For example, a Toyota plant recently began production in Texas has made maximum use of its sibling’s experience in Kentucky which has been cultivated over the past 20 years. Toyota believes that in order to reach their goals is through educating people. Multiple Global Production Centers have been built within Motomachi Plant in Toyota City, in United States, the United Kingdom, and Thailand to carry our corresponding activities in the Asia-Pacific, European, and North American regions. To promote the “Toyota Way”, the Toyota Institute established an internal human resources development organization in North America, Europe, Asia, Africa and Oceania. As you can see the pros of the globalization of Toyota are endless. This company alone has created millions of jobs across the world. Winners are not only the workers, but also the buyers, without globalization Toyota automobiles would only be available in Japan. Many people, including me, see globalization of this kind as a beneficial and advantageous result. Toyota companies have not only created jobs for thousands if not millions of people, but their
Kiichiro Toyoda found Toyota Motor Corporation on August 28th 1937. Kiichiro Toyoda is the father of the giant automotive industry, Toyota. The headquarters of Toyota is located in Toyota, Aichi Prefecture, Japan. Toyota Motor Corporation has manufacturing plants all around the world with a total of 32 countries consisting of Malaysia, Japan, America, China, Australia, Thailand, Singapore, Belgium, Bangladesh, Vietnam, Philippines, Pakistan, Indonesia, India, Taiwan, Egypt, South Africa, Kenya, Kazakhstan, Russia, U.K, Turkey, Portugal, Poland, France, Czech Republic, Venezuela, Mexico, Brazil, Argentina and Canada. As a giant in the automotive industry, the company consists 333,498 employees as from 31st March 2013(Toyota, 2013). The information
Toyota’s uses both differentiation and low cost as generic strategies to try and gain a competitive advantage over their competitors in the automotive industry. The market scope that Toyota uses is a broad one that encompasses nearly every type of customer that is in the market to purchase an automobile. Toyota is able to target such a large market because they have something for everyone. Toyota has four wheel drive trucks and SUVs for the outdoor types or those who live in areas that face severe weather conditions, hybrid models like the Prius for the eco-friendly customers that are interested in saving the environment, along with the standard cars for general, everyday use. Additionally, Toyota provides vehicles for all price ranges.
Toyota has adopted an expansion strategy aimed at increasing the company’s market share through sustainable growth. This will be done based on the delivery of high quality, and safe cars, at an affordable price. As the company seeks to expand to new markets, focus will be on maintaining an organizational culture that allows optimum efficiency in the ever dynamic global market.
Toyota seemed to be suffering from a major problem with their decision making. Decision making for an organization the size and influence of Toyota needs to be top of mind for its management structure, from the CEO down to the supervisors in their manufacturing facilities.
The toyota Prius is projected as the “right” car to buy because you will save the planet. Many people tout the benefits on the environment that hybrid cars have. Toyoda has adopted this into many of their hybrid car advertisements to help sell cars to the environmentally conscious consumer. The Prius has been Toyota's top seller in their hybrid car lineup for years, in fact it even tops the hybrid charts across all of car manufactures in america. Prius outsold its closest competitor in the hybrid market, the Ford Fusion, by over 2000 cars.
Toyota Motor Corporation is one of the largest automakers in the world. At its annual conference in Tokyo on May 8, 2008, the company announced that activities through March 2008 generated a sales figure of $252.7 billion, a new record for the company. However, the company is lowering expectations for the coming year due to a stronger yen, a slowing American economy, and the rising cost of raw materials (Rowley, 2008). If Toyota is to continue increasing its revenue, it must examine its business practice and determine on a course of action to maximize its profit.
This factor forced car markets to produce small cars. Toyota satisfied this market requirement, so Toyota became popular in the America car’s market at that period. Furthermore, Toyota had trouble to selling their car in the luxury market, like their model of Crown and Cressida that could not satisfy consumers’ demand of luxury car market whether though its function or its shape. Therefore, now Toyota keeps their style of reliability and low-cost maintenance, which make them popular all over the world. However, there are still some competitors for Toyota’s in different markets. For example, both Ford in the U.S and Honda in Japan are all their
The nonmanufacturing companies can learn and apply from Toyota’s philosophy and practices as listed below: