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Toyota Revs Up U.S.

Sales

A Case Study

Summary
Since 1903 Chevrolet and Ford were dominating US automobile market. But on 2002 a new giant emerged there.

The Toyota Motor Company of Japan

Summary
Toyota-one of the most popular automobile manufacturer of the world was established on 1937. During 1990s, rather than USA they targeted some others part of the world as their most prospective market. But they had to abandon their plan and had to emphasize on US market under different circumstances. Ultimately they succeed tremendously in US auto market in the following decade.

Summary
Question is how?

We must Americanize. Fujio Cho, CEO, Toyota.


After achieving the extraordinary success, Toyota is planning to Grab the top place of American automobile market. Their current Performance clearly indicating that it is quiet possible. Toyota Chairman Hiroshi Okuda joked that the company should Move its headquarters to the United States.

Problem Definition
The Threats and Opportunities of Toyota. The Strengths and Weaknesses of Toyota.
The business level strategy Toyota in US market. Effectiveness of Toyotas Corporate Level Strategy over the next ten years.

Theoretical Framework
Missions SWOT Analysis

Internal Analysis Strengths and Weaknesses

External Analysis Opportunities And Threats

SWOT analysis helps to formulate strategies to: Exploit opportunities and strengths. Neutralize threats. Avoid weakness.

Solutions and Findings


Threats: Competitive Rivalry in different markets. e.g.: Chevrolet and Ford in USA Honda and Nissan in Japan Economic Recession in South-East Asia and Europe. Opportunities: Slow Response from American competitors. Favorable attitude from the Government. Acceptance as a Domestic Brand among customers.

Solutions and Findings


Strengths: Long-term effective planning. Cost Leadership. Widespread production facility. Effective, efficient and advanced Technology. Weaknesses: Mentality of traditionalists inside Toyota. Lack of understanding of American customer.

Business Level Strategy


Porters Generic Strategies Differentiation. e.g.: Aarong Overall Cost Leadership. e.g.: Maruti Automobiles Focus. e.g.: Nestle The Miles and Snow Typology

Prospector. Defender. Analyzer. Reactor.

e.g.: Amazon.com e.g.: Holcim Cement e.g.: Yahoo! e.g.: Biman

Toyotas Business Level Strategy


According to Porters Generic Strategies: Focus Toyota using differentiation focus strategy introducing Different types of products to different market segment. Toyota using overall cost leadership focus strategy in American market. According to Miles and Snow Typology: Analyzer Maintaining existing US market share, Toyota is now planning to catch new customers such as Rural Customer.

Corporate Level Strategy


Single Product Strategy. e.g.: Econo Ball Pen Related Diversification. e.g.: phone company adding wire company
Unrelated Diversification. e.g.: oil company adding computer company

Toyotas Corporate Level Strategy


Toyota following Related Diversification Strategy Focusing US market Toyota developing new products like Hybrid Car, Emission-free car which runs on hydrogen fuel cell etc. with their existing facilities. This strategy is supposed to be successful because the Americans like style, quality and efficiency. US authority also adopting strict policy about emission day by day.

Recommendations and Conclusions


Provide installment facility to individual customers. Provide special facilities to Corporate and Government clients. Forming business alliance with reputed companies and introduce Fusion Marketing. Both Backward and Forward Vertical Integration can be considered as a tool to increase market share.

Thank You

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