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Global Economic Implications of The Toyota Motor Company
Eric, Charles, Molly, Colby, Gene
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Agenda
• Company Overview• Net Revenue / Operating Income• Financial Services Operations• Other Areas of Business• Business In Other Countries• Competition• Product Failure Recovery's• New Technology
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Company Overview
• Public Company• Industry– Automotive– Robotics– Financial Services
• Founded: August 28, 1937
• Founder: Kiichiro Toyoda
• Key People– Fujio Cho (Chairman)– Akio Toyoda
(President and CEO)• Employees: 324,747• Divisions– Lexus– Scion
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Net Revenue / Operating Income
• Japan– 2010 Domestic sales increase by 11.2% (218,000) to 2.16
million units.– Net Revenues declined 7.9% (966.4 billion) to 11.2 trillion– Cost-reduction efforts / lower fixed costs = $12.3 billion
improvement = (225.2 billion)• North America– Vehicle sales decreased 5.2 % (114,000)to 2.10 million
units.– Net Revenues decreased 8.9 % (552.4 billion) to 5.7
trillion
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Financial Services Operations
• OverviewTotal assets: 13.3 trillionNet revenues: 1.2 trillionOperating income: 247.0 billionOperating areas: 33 countries / regionsNumber of customers: About 8.1 milNumber of employees: About 8,000
Toyota Motor Corporation
Overseas Sales Finance
Companies
Toyota Finance Corporation
Toyota Asset Management
Co., Ltd.
Toyota Financial Services
Corporation
Financial Services Operations Organization
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Other Areas Of Business
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Other Business Operations• Intelligent Transport Systems (ITS) Business
– The planning and development of products and services for ITS. The creation of vehicle-infrastructure cooperative systems that support safe driving.
• Information Technology and Telecommunications Business– Engaged in the planning and commercialization of services that
integrate vehicles and cell phones. Also serving as a sales agency for cellphones provided by KDDI corporation.
• E-TOYOTA Business– Developing e-TOYOTA business operations which offer
additional value to customers by integrating IT services with automobiles.
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Other Business Operations 2• Housing Business– Manufacturing luxury houses in Japan.
• Marine Business– Toyota is expanding into the marine business
manufacturing boats and engines.
• Biotechnology and Afforestation Business– Contributing to the creation of a resource recycling society
through its biotechnology and afforestation operations.
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Other Business Operations 3
Toyota uses technologies and expertise gained from the automotive operations to operate a variety of businesses.
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Business In Other Countries
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Business In Other Countries
• Manufacturing and Distributing companies in different countries including:– North America– Latin America– Europe– Africa– Asia (excluding Japan)– Middle East
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Business In Other Countries (Shipping)
• Shipping via boat, hauling 8,500 vehicles• Uses NYK Line – Japanese Shipping Company• Expected imports through Newark to
increase by 20% in 2012 compared to 2011• Rebounding from Natural Disasters• United States and Puerto Rico
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Business In Other Countries (Advertising)
• Toyota creating two new companies to manage marketing– One for Japan– One for Worldwide
• Stems from reorganization of a global marketing division
• The company spends about $1.2 billion annually on ads
• In 2009, Toyota posted first annual loss in 59 years (during recession)
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Competition
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Competition on all Fronts• Asia
– Honda– Hyundai– Mitsubishi
• North America– Ford– Chevrolet – Dodge– Chrysler
• Europe – Fiat– BMW– Saab
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Hometown Competitor
Category Toyota Toyota
Stripped Toyota Loaded Honda
Honda Stripped
Honda loaded
Small Car Corolla 13330 18880 Civic 13010 21210
Family Sedan Camry 18970 25405 Accord 15880 29886
mini-SUV RAV-4 18975 24287 CR-V 17110 26853
mini-van Sienna 28012 36250 Odyssey 24440 35282
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North American Challengers
• Chevrolet– Fuel efficient– Higher safety ratings– Shorter breaking distance
• Ford– Innovative – Clean Running– Pleasing to the eye
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Europe
• BMW– Know for higher class– Have a serious following– More expensive
• Mini– Compact– Has a luxury aspect while still comparable
• Fiat
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Recovering After Product Failures
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Toyota • Faced with big recovery trust
with the product failures
• Did not act early
• Example: Brakes– “brake override system”
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Trustworthiness & Recovery
Trust• Gain Trust:
– Take serious actions– Keep issues open in a
positive way– Responding to customers
Recovery• Toyota actions:
– Take full responsibility for mistakes
– Learn from them– When something happens
act immediately
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Bonds of Trust
• Maximizing customer satisfaction by strengthening bonds
• Standardizing service quality
• Development of new compact car etios
• Position in market
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General Overview
• Toyota focused on customers• Fully investigate• Toyota has grown by quickly responding to market needs• Quality control processes
• Strengthened monitoring function • Strengthening the information gathering function• Increasing the number of technical offices• Human resource development
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New Technology
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New Technology• Prius
• Safety Technology
• Cabin Electronics
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Prius
• Low MPG
• Recyclable batteries
• Solar Technology
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Safety Technology
• Controlled Steering
• Heartbeat Monitor
• Pop-up hood/ Airbags
• Headlights
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Questions?