Assignment 1 / Essay Assignment question: It is sometime suggested that CSR activities are increasing strategic in that it affects that core business of the firm and its growth, profitability….
Toyota Motor Corporation is a multinational car manufacturer in Japan, and the world’s largest automaker currently. One thing may be you don’t know, before the Toyota Motor Corporation, Toyota didn’t produce cars, they made clothes. After Toyota sell their technology of making clothes to the UK, they started manufacturing cars; and eventually became the world’s largest automaker. Presently, Toyota owns and operates the Lexus and Scion brand. Recently, people became more and more concern our environment and whether their cars economic or not, resulting in decision Toyota made that developed hybrid cars.
Toyota Prius, as the first hybrid car had went on sale in Japan in 1997. It was introduce to the entire world in 2001. Now, Prius is sold in more than 40 countries, and its largest market is Japan and North America. In accordance with the United States Environmental Agency, Prius was the most fuel efficient car sold in the U. S. Issues It has a rebound to positive growth in January and February since the number of car sales continued the downward trend in June last year.
In March, the number of car sales is about 110million in China, which is more than the first automobile consuming country-U.S. RMB loans increased by 24. 4% year-on-year in February, and credit terms has achieved a better level in history. According to this message, which is good news to cars company, Toyota maybe have some opportunity in china market. But in other European countries, it still has less business, because the cars market still has a disaster all over the world. For instance, Obama, president of the United States rejected the GM and Chrysler 21. 6 billion U. S. dollars of assistance to request in March 30th.
It means the U. S.cars market still has a decrease, and Toyota also has suffered from the economic recession. But in the other way, due to the economic recession, the price of steels has decreased than before around the world, it has a lowest price in near five years, and many steel-making factories have a lot of stocks in trade. So Toyota has an advantage to continue its business, because it can save money from materials, and it can use the same money to produce more cars. In Japan, rising unemployment and declining wages curbed car buying.
Japan in February to cash income of workers, and the fastest rate of decline in February over the past 5 years while the unemployment rate rose to 4. 4 percent for the highest level in 3 years. According to the Japanese car trade group predicted that the next fiscal year will be Japan’s new vehicle sales dropped 8 percent, only 4. 3 million, a 32-year low. Some countries have made some new laws of tariff to protect domestic industry and business. For instance, in Russia, the government makes a new policy in tariff to control the exporters to its country. (Raise the tariff in import cars from other countries)
Internal Analysis Sustainability in Three Areas -Technology (achieving sustainable mobility) Technological innovations hold the key to the environmental preservation and economic growth that are essential for Toyota to contribute to a prosperous society and the earth. Accordingly, Toyota is conducting research and development aimed at the realization of an automotive society that can coexist with the earth, or sustainable mobility. As you can see from the table 1, it shows trends and forecast of world energy demand by fuel. Obviously, renewable and nuclear energy would be used widely.
So based on the vision of “Zeronize & Maximize”, Toyota aims to minimize the negative impact that vehicles have on the environment, while maximizing their positive aspects, such as convenience, comfort, enjoyment, and excitement. To improve environmental performance, one of Toyota manager said “with respect to power trains, by 2010 we will have installed in all our vehicles a new series of gasoline and diesel engines and transmissions to boost fuel efficiency. In addition, we are currently increasing efforts to further evolve hybrid technology and expand our hybrid line up.
” -Manufacturing (implementing “Sustainable Plant” activities) Sustainability is also being pursued at the plants that drive Toyota manufacturing operations. In July, Toyota initiated “Sustainable Plant” activities with the goal of creating production sites that are in harmony with their natural surroundings. Toyota conducts its “Sustainable Plant” activities globally on three broad fronts. The first energy reduction through the development and introduction of low CO2-emitting production technologies and daily activities.
The second is energy conversion utilizing photovoltaic and other renewable energy sources. The third is tree-planting to foster involvement with local communities and ecological preservation. -Society (Environmental Activities for a Sustainable Future) Toyota engages in a wide range of nurturing society activities at home and abroad as it seeks to become a trusted global corporate citizen and to contribute to the sustainable development of a prosperous society. Toyota implements measures on a national and international level in its efforts to achieve a sustainable level of global environmental preservation.
Recognizing the importance of ongoing efforts deeply rooted in local communities, they proactively contribute to society in each country and region through their development programs for forestry, human resources and the local community. -Resource Saving To achieve efficient use of finite resources, Toyota industries promotes design and development that implements the 3Rs ( table 2 ); reduce materials used by utilizing them more efficiently, reuse products and parts that have completed their service life and recycle resources. Implementing 3R Design for all products
To ensure easy implementation of reducing, reusing and recycling of resources. Starting from the development and design stages they pursue the rationalization of rawmaterials usage and the safety and efficiency of dismantling process. Serval examples illustrate the scope of our efforts in this area. For their new two-wheel drive shovel, a certified environmentally friendly product, Toyota industries utilized recycled materials for the counter weight and re-evaluated the structure of the headlights to improve ease of recycling.
( Cho, F. 2007 ) -competitive advantage Toyota is outstanding at manufacturing equipment and serving a source of competitiveness for each business and protecting against any outflow of proprietary. They are also utilizing their strength in creating manufacturing equipment for the quick startup of operations at oversea production bases. Based on these strengths Toyota focus on raising the production technology capabilities of the industries. External Analysis Porter’s 5 forces Threat of New Entrants
In the past, people thought that the American automobile industry and the Big Three were safe; however, this did not last long time when Japanese automobile companies like Toyota went to American market, and took a lot of` market share of the North American companies. The reason for that is cars are big consumption for every family, and people consider various elements before their buying behaviour. That is rational, so consumer take the car with high quality and lower price home. The point is the threat o new entrants is high if the new entrants have the high technology to manufacture and they control the cost very well.
Power of Suppliers The power of the suppliers is low because that normally automobile supplier rely on the car manufacturer very much. The supplier will has no business if the previous car manufacturer decided to change their supplier. As a result, suppliers hold very little power. Power of Buyers Power of buyer is huge. There are a number of automobile manufacturer all around world, that means consumers have various alternatives. In addition, nowadays, the consumers are very price sensitive, if they think your car is expensive, they turn to look at the Japanese.
If they think your Japanese car is expensive, they turn to look at the cars made by China or India. In a word, consumer can influence the automobile companies to change their cars. Availability of Substitutes This force become higher today. That not only means people will bur other companies’ cars instead of buying your cars. Toyota should be careful with the fact that more people choose the public transportation from several reasons. Like it’s not easy to park private car when you go out, and the cost of having a car goes up.
That different factors makes the more substitutes. Competitive Rivalry Almost every automaker got loss during this financial crisis even the Toyota. But toyota become the top-seller in the period because their sales didn’t went down too much. That’s reasonable due to the fact that company invested a lot into developing some environmental and less gas consuming cars. Additionally, automakers avoid price-based competition, but now the competition has arisen. discount, buy today pay tomorrow, and many strategies are used by the automakers in order to survive.