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Indus Toyota Industries has serving its customers since long time. Indus Toyota motor develops and manufactures automobiles and automobile-related products, such as vehicles, engines, car air-conditioning compressors, car electronics components and devices, and stamping dies.
THE EYES OF THE CUSTOMERS
"Concern beyond Cars" We are providing reliability, after sales service, better performance, safety and spacious. We know that the only way to meet the needs of the customer is by putting our self in the shoes of customers and asking our self what we need, what would make us happy.
Indus motors (Pakistan) started its business in Pakistan as a public limited company in December 1989. The shares of the company are quoted on the stock exchanges of Pakistan. IMC’s production facilities are located at Port Bin Qasim Industrial Zone near Karachi in an area measuring over 105 acres Plant (Indus Motor Company Limited Plot No. N.W.Z/1/P-1, Port Qasim Authority, Karachi, Pakistan) Karachi Sialkot Quetta Islamabad Larkana Rawalpindi Lahore Peshawar Faisalabad Azad Kashmir Sargodha Dera Ismail Khan Multan Mardan
Based on five pillars
• • • • •
Respect for People. Safe and friendly environment for all. Best work practices based on Ethics and Integrity. Teamwork. Honesty is the best policy 2
manufactures. Hilux. and sells the world's motor vehicles. markets. develops. and reliability. performance. Fuel economy. while maintaining high standards of efficiency and cost control. consumer needs the following benefits from corolla • Better performance • • • • • • Spacious Central lock Tracker AC Child lock Internal and external stylish design CUSTOMERS Toyota's are such great vehicles that every one is the user of Toyota or prefer to buy. We are going to analyze on Toyota Corolla. The variants of Corolla are: • Corolla-XLI 3 . Toyota Indus designs. Employment. CONSIDERATIONS IMC is currently working in SBUs which are corolla. Toyota vehicles based on quality. at the right time. The concept is to provide the right product and information. in the right amount. TECHNOLOGIES Just in Time spirit implies two opposing forces of providing fast and flexible response to customers. yet building efficient mechanisms and systems that are efficient and waste-free. BUSINESS FUNCTIONS Automobile sector is one of the fastest growing sectors in Pakistan. in the right manner. dependability. Investment and much more. and for safety and design. We are going with corolla a famous car of Toyota. Coure and Camry. It contributes towards the nation’s economy in the form of Technology Transfer.
0 D VISION STATEMENT “To attract and attain customers with high-value products and the most satisfying ownership experience around the world” MISSION STATEMENT “To be the most successful and respected car company around the globe” Current policies • • • • • • Mandatory deletion program which has brought the industry to current level and to Expansion of auto assembly operations Diversified vendor sector Transfer of technology Development of indigenous industry For future expansion based on international environment we need to move towards a tariff based system BUSINESS OBJECTIVES: • • • • To establish a globally competitive automobile industry in Pakistan by the year 2012. We will start a joint venture with House of Habib (HOH) in production and sales. In the future we plan to further advance the products and systems we have put into the practical use.000 units/year Increased capacity to enable export of automobiles and auto parts by significantly enhancing the industry’s contribution to the economy. 4 .• • • • • Corolla XE Corolla Altis 1794cc Corolla-GLI Corolla-2. by increasing motorization level by enhancing the automobile production to 500.0 D Saloon Corolla-2.
3. we are working to produce cars that are friendly to both people and the earth. Toyota is working on R&D activities to produce vehicles that will perform at the highest level of safety and ensure comfortable driving under various conditions. comfort. CORE PRODUCT (NEEDS) Transport (i. low maintenance cost. Based on the Toyota earth charter. POTENTIAL PRODUCT Future product innovation and featuring) Safety measures 4. high resale value. EXPECTED PRODUCT More Mileage. AUGMENTED PRODUCT (Value added product and services) Good quality.e. innovation. Better Accelerator. BASIC PRODUCT CAR 1. More Reliability. To this end. 5. Toyota’s history has been filled with challenges. Fuel Efficiency 2. after sales service. convenience and mobility) 5 .• • Automotive safety is one of the factors that must be given top priority in car making.
Honda Civic* Luxury car segment Toyota Camry.Product levels MARKET STRUCTURE: Small high segment Toyota Corolla. Honda Accord* Pick-up segment Hilux Ravi* 4X4 segment Land Cruiser APPLICATION PRODUCTS Economy segment Mehran*. Note: Segment of our representative company is in bold form. segments of competitors in auto mobile Industry are written in Italic form with Star Sign (*) 6 . Honda City*. Cuore Small low segment Cultus* Dealership Indus Motors Co. where as.
A 42% 16% 31% 5% 19% 20% 28% 36% 13.MARKET SIZE: Past Growth MARKET SEGMENT Economical Mehran Cuore Small low segment Cultus Liana Small high segment Luxury car segment Pick-up segment 4X4 segment Toyota corolla Honda civic Honda city TOYOTA CAMRY HILUX Ravi LAND CRUISER 2005 31165 8592 15591 23002 12359 11714 3389 3310 3520 2006 35982 7883 21342 5370 30527 12274 16136 21 2551 5418 5165 VOLUME 2007 37007 12776 29880 5964 35762 5610 11848 43 52 10117 2125 2008 35526 12204 27662 2605 33640 5813 8439 17 2001 11828 4727 2009 13421 5852 9181 684 26760 4985 6482 54 1534 12643 1616 Growth P.88% 42.75% 56.5% 7 .
A Growth of Toyota Corolla is assumed to raise almost 20% P. sales promotion. expansion of dealers and strong Customer relationship Total used imported car market is projected to decrease by 43% due to Corolla and Hiace Imports manufacturing in Pakistan Growth of Mehran is assumed to raise almost 18% P.A Liana Production would be expecting to stop in Pakistan by Pak Suzuki in 2012 Growth of Honda Civic is assumed to raise almost 22.A 8 .PROJECTED FUTURE GROWTH: Assumptions: Total new car market trend is expected to increase during period of 09-10 by 28% IMC sales and market share is expected to grow with aggressive marketing.A Growth of Ravi is assumed to raise almost 15% P.5% P.A Growth of Land Cruiser is assumed to raise almost 14% P. Whereas production of Cuore is ended by CKD of Indus Motor Company from 2011 Growth of Cultus is assumed to raise almost 25% P.A.A Growth of Honda City is assumed to raise in less proportion around 3 to 6% % P.A Growth of Toyota Camry is very unpredictable to say either rise or decrease because it is order based and focusing on niche market demand Growth of Hilux is assumed to raise almost 11% P.
Projected Growth: MARKET SEGMENT Mehran Cuore Cultus Toyota corolla Liana Honda civic Honda city TOYOTA CAMRY HILUX Ravi LAND CRUISER 2010 1779 7 1560 1475 0 3827 0 751 5850 6660 10 733 2079 2 490 2011 1922 1 0 1806 9 4439 3 25 6611 6860 16 755 2411 8 560 2012 2402 6 0 2267 7 5016 4 0 7636 7272 28 810 2870 0 612 2013 2835 0 0 2868 6 6019 0 0 8896 7708 87 1000 3214 4 725 Volume Growth P.0 D Saloon Corolla-2.5% Increased 3% to 6% Based on order Growth increased by 11% Growth increased 15% Growth increased 14% Product Life Cycle Stages: We have selected SBU of Toyota corolla. and here we are interested to know that which product of corolla lies at which stage Product Segments Corolla Altis 1794cc Corolla-Gli Corolla-Xli Corolla XE Corolla-2.A Growth by 18% almost Production ended by CKD Growth by 25% Growth by 20% Production ended Growth increased 22.0 D Introduction Growth Maturity Decline 9 .
86% 36% 30% 1.Competition/ segment matrix We are analyzing here market attractiveness with respect to our competitors and segment wise in which we are interested to know historical growth.5% 14% 1.Suzuki Toyota share Competitors share Gross Total Historical Growth Projection Co’s Profitability 18% 28% 30% 23% 70% 8% 12% 15% 10% 21% 26% 23% 70% Competitor extra market share 18% 88% 36. Competition Economy Mehran Cuore Small City High Civic Segments Segment Corolla Luxury Camry Pick up Hilux Ravi 4x4 (Jeep) Land Cruiser Overall 1.5% 3 5% 11% 2.Toyota 3.9% 38% 18% 19% 10 .54% 22% 17% 13.Honda 2. projected growth and company’s profitability with respect to segment covered by our & other companies. We have gather information of market share of companies from different sources and based on assumption that these three companies captured 88% market share overall of automobile sector in Pakistan and remaining shares are covered by rest of the companies.7% 18% 5.3% 15% 43% 56.
Distribution structure: (2008 to 2012) Economy Company Name Mehran For 2008 Year Segment Small High Cuore City/Civic (each) Corolla Segment Baleno/ Liana Pickup Segment Hilux 4x4 Segment Land Cruiser Total Dealership 42 42% 28 28% 27 27% 28 28% 42 42% 28 28% 28 28% 97 56% Economy Company Name Mehran For 2010 Year Segment Small High Cuore City/Civic (each) Corolla Segment Baleno/ Liana Pickup Segment Hilux 4x4 Segment Land Cruiser Total Dealership 45 32 30 32 45 32 32 107 45% 32% 30% 32% 45% 32% 32% 62% The current dealers of Pak Suzuki are 45. and existing dealers of Honda are 30. We have taken average of dealer’s %age in obtaining total with respect to year 11 . current dealers of IMC are 32. Assumption: In 2012 year. That’s how total distribution network shrinks from 62% to 56% in 2012. It is expecting to increase dealership by these three companies till 2012. at least increased 3 to 5 dealers by each company. we have gather information that SBU of Liana/Baleno will expected to stop production in Pakistan by Pak Suzuki so we have not shown here its dealers contribution in Distribution structure.
Economy Company Name Mehran For 2012 Year Segment Small High Cuore City/Civic (each) Corolla Pickup Segment Hilux 4x4 Segment Land Cruiser Total Dealership 48 48% 35 35% 33 33% 35 35% 35 35% 35 35% 116 56% Distributions share and company’s positions (2008) All figures of Sales per dealers are taken basis on assumption and certain idea given by one of dealers to us. 34000 units sold so its turn over share is calculated basis on same formula i. Honda has 30 dealers in Pakistan.3% 2. Based on available information and certain assumption we have calculated outlet coverage of each dealership with respect to each company. in 2009.20% 33. approximately 40000 units sold in 2009-10 year and having 32 dealers overall. Similarly. Similarly Pak Suzuki are having 45 dealers in 2009-10.5%.33% 7.3% turn over share.e.5% 5.33% 13. and its shares per dealer is assumed around 75000 units due to its massive production and large market share of multiple product range.40% 100% Toyota Honda Pak Suzuki Hyundai BMW Turnover Share = Co’s Sales per Dealers/∑ Co’s Sales by all Dealers Outlet Coverage = ∑ Co’s Dealers / ∑ Dealership Total Distribution of Automobile sector is around 135 in Pakistan bases on our estimation for selected companies. Its turn over share is 2.e.70% 22.125% competitors turnover share 3. around 3. % of mln rs All Pakistan distribution 32 30 45 18 10 135 Companies turnover share 3.5% 10% Outlet Coverage 23.e. Companies turn over share is calculated basis on taking assumption of sales per dealers of Toyota i. and its sales per dealer assumed i. 12 .
Ltd Products CC Coure Cultus Toyota corolla Toyota Camry Hilux Land cruiser No Products Honda civic Honda city No Products Mehran Ravi Liana 800cc 800cc 1300cc 1500cc 1300cc Suzuki CC Cost 514000 489000 1229000` 800cc 1000cc 1300cc 2400cc 2800cc 3800cc Atlas Honda CC Cost 1229000 1349000 Cost 709000 897000 1269000 6299000 3140000 13000000 1 2 3 4 5 6 1 2 1 2 3 What do our customers wants? As we are in the auto industry and every day is a new day because every thing inside and outside the organizations changes rapidly i. culture and demand.e. consumers preferences. • They want reliability • They want quality • They want low mileage • They want fuel efficiency • They want innovation and new products. • They want high resale value. • They want safety installed in the cars Do we really know that? 13 . technology. So we are focusing on the following wants of the consumers. trend.PRICE ANALYSIS Are the companies price and cost are competitive? No Indus Motors Co.
you can manage and eliminate threats that would otherwise catch you unaware. it can help you uncover opportunities that you are well placed to exploit. Are we providing these facilities? Yes we are providing these facilities because Indus motors have a large number of products and solutions in the automobile industry with the best people and best technology. they have the benefit of fuel efficiency. SWOT ANALYSIS: SWOT analysis is an analytical tool that for understanding the strength and weakness of organizations and opportunities and threats. We know how to make our customers delight and how to make long term relations with our customers. we are known in the eyes of customers for reliability and best quality.Yes we know that our customers want these facilities. All the parts are easily available at economic prices. We keep tracking and analyzing the needs and demand of our customers. And by understanding the weaknesses of your business. Indus motors also provides the best resale value of their cars in the market which attracts the customers and so forth. Strength: Loyalty from the customers Extensive research and development Highly customer focused cars Strong financial position High resale value Easy availability of spare parts Well established dealer network Enjoying 26 % market share Brand image in the mind of customers Brand loyalty of customers Toyota currently uses ultra high strength steel grades in 2009 model year vehicles Diversified product range Positive work climate and organization culture After sales service Weakness: Low capacity of production with respect to Pak Suzuki 14 . With a thought.
Cater to new market segments such as Small low segment i. 1. Appreciation of yen and also devaluation of Pakistani currency with respect to Dollar currency Higher the discount rate from state bank affects the sales of auto industries.e. they should finance cars by setting their own financings. thus increased on imports Faces problem in gear box and clutch plate of Cuore Opportunity: Expansion to foreign markets particularly in less developed countries Local company’s expansion due to high consumer demand.1000cc- 1200cc range Opportunity to introduce its Toyota corolla with CNG fitted Environmental friendly vehicles Threat: WTO (World trade Order) opening local markets for global competition The rising price of the steel is the great threat to the sector.Almost same shape of Toyota corolla available in 1300 cc and also in 1800cc. if Toyota copes up with this problem they can survive and retain its market position (their own steel plant). (x mart introduce their own bank to finance the banks) Toyota Faces stiff competition with firstly Honda and Pak Suzuki Narrowing industry margins 15 .8 Altis whereas the Honda & other competitors has different shape in its product range Less safety measures provided in most of their brands Lack in ability to make parts locally.
Local expansion due to high consumer demand. Environmental friendly vehicles. Cater to new market segments such as 1000cc range with CNG. OPPORTUNITY Only opportunities after improvement WEAKNESS 1.EXTERNAL ANALYSIS OPPORTUNITY INTERNAL ANALYSIS STRENGTH PROMISING OPPORTUNITIES 1. Unable to meet the local demand THREAT Ability to resist STRENGTHS 16 . 3. Expansion to foreign markets particularly in less developed countries 2. 2.
The rising price of the steel is the great threat to the sector. “See it coming. Higher the discount rate from state bank affects the sales of auto industries. IMC is interested to cater the need of economy segment in future. While Honda says it is a sign of impression. Toyota is the name of durability. if Toyota copes up with this problem they can exist in the market (their own steel plant). Mehran and Alto are considered economical and popular among them. 3. cutting-edge design. style and looks. there is a need to flourish the production of the cars for the upcoming needs of middle and lower middle customers. (X MART INTRODUCE THEIR OWN BANK TO FINANCE THE BANKS) INTENDED BUSINESS: The Toyota corolla is generally designed for the upper and upper middle level customers. The main competitors of it are Honda Atlas and Pak Suzuki. Striking good looks.1. The products of them which have almost the same specifications are: Honda City and Suzuki Liana in 1300 cc. Appreciation of yen also the threat. In future. It is the ideal vehicle according to the roads in the city and customers think that it is most reliable vehicle for them nowadays and for future prospects Toyota should launch new corolla with affordable features for the middle and lower middle customers to beat their competitors those are launching 1300cc cars in low prices. Suzuki say that it’s become a household name because they focus on the middle and upper middle class. So it is the demand of every citizen. they should finance cars by setting their own financings.” PRICE ANALYSIS Are the companies price and cost are competitive? No Indus Motors Co. & focused oriented. safety and comfort. 2. like an arrow. Ltd Products CC Cost 17 . RELATIONS WITH OTHER BUSINESSES: Although the market share of Toyota is the largest in the industry.
technology. We keep tracking and analyzing the needs and demand of our customers.e. So we are focusing on the following wants of the consumers. We know how to make our customers delight and how to make long term relations with our customers. • They want safety installed in the cars Do we really know that? Yes we know that our customers want these facilities. • They want reliability • They want quality • They want low mileage • They want fuel efficiency • They want innovation and new products. trend. Are we providing these facilities? Yes we are providing these facilities because Indus motors have a large number of products and solutions in the automobile industry with the best people and best technology. consumers preferences.1 2 3 4 5 6 No 1 2 No 1 2 3 Coure Cultus Toyota corolla Toyota Camry Hilux Land cruiser Products Honda civic Honda city Products Mehran Ravi Liana What do our customers wants? 800cc 1000cc 1300cc 2400cc 2800cc 3800cc Atlas Honda CC 1500cc 1300cc Suzuki CC 800cc 800cc 1300cc 709000 897000 1269000 6299000 3140000 13000000 Cost 1229000 1349000 Cost 514000 489000 1229000` As we are in the auto industry and every day is a new day because every thing inside and outside the organizations changes rapidly i. culture and demand. • They want high resale value. All the parts are easily available at economic 18 .
they have the benefit of fuel efficiency.prices. For IMC. we are known in the eyes of customers for reliability and best quality. They have heat exchanger. CURRENT STRATEGY: • • • • Synchronized dealership network setup. Toyota concept is purely depends upon Total Quality management (TQM) • • • • • • • 19 . Collect information from customers through quality reports from dealers and questionnaires given to purchases of new cars and suppliers. The main differentiating factors are the overall industry for Toyota cars is its customer’s base and brand loyalty. improved product design and durability of its product. Quality of product has not been comprised with and very heavy investment has been made to build its production facilities based on state of art of technologies. It’s after sale service is improved efficiently with the passage of time. Indus motors also provides the best resale value of their cars in the market which attracts the customers and so forth. Toyota always tries to grasp shifts in customer demands constantly checking for conformity with its standards and acting swiftly to resolve any discrepancies. the vendor supplier to reduce their bargaining power. IMC has installed capital intensive technology. which is shown by their product development program. drying tower etc. the innovative concept revolved around the “Toyota 3 S Dealership”. The vendors work at an established rate that only varies in prices whenever inflation takes place. After sale service is a very important aspect of Toyota motors. spray booth. Toyota Indus Motors Company spends a lot of amount on R&D. Its spare parts are charging reasonable to buy. IMC provides better customer service through adopting product differentiation strategy. They are using conveyer belts to transfer a car during assembling from a station to another station.
The automobile industry facing the biggest threat i. Toyota increases their product prices with this increment. On their part the automobile producers blame the constant devaluation of local currency. discouraging the sales. increases of the steel prices which causes lower down the profit margin.000 units and Honda with 50. the uncertain Rupee-Yen parity. IMC and Atlas Honda products. They also cite internal policies. resulting in massive under-utilization of capacity in the automobile industry.000 units in single shift. Demand of passenger vehicles increased. while Honda was able to utilize only 62 per cent of its total capacity. 20 . due to this the sales of locally assembled cars increases. Toyota 66 per cent. the production capacity of Suzuki increases. Suzuki has an annual production capacity of 100. This leads to increase in prices of Suzuki products up to 38 %. increasing costs of production and the absence of economy of scale to benefit from the purchase of parts and raw materials needed in bulk quantity and at concessionary rates to reduce the prices.e. Suzuki was able to utilize over 72 per cent of its production capacity. Government of Pakistan withdrew the facility to bring cars from oversees under personal baggage.DESCRIPTION: With the increase of the demand from customers for the passenger cars. which further lead to increase in sales and growth of Pak Suzuki.000 units in three shifts followed by Toyota with 33.
for both increased service capacity at our dealerships as well as enhanced convenience for our customers. That is a reason. There is a strong emphasis on After Sales Service at IMC and its dealerships. among vendors and dealerships help to improve standard work and focus our approach to customer oriented that is how they are quickly resolving their key issues throughout the Company and our Dealer network to maximize customer satisfaction.21% and Suzuki has 2.25 % on its sales.874 units. 27. an increase if 26% and translated to a sales value of Rs. 21 . Trend in profit margins The current trend of profit margins of Toyota 5. based on Toyota Production System provides for prompt maintenance of vehicles and has strong customer appeal for speedy delivery of service vehicles with attention to quality detail. Toyota has large customer base with good reputation.5 billion during 2006-2007. 22. Toyota Honda Pak Suzuki This analysis shows that company earned 2.6 billion as compared to Rs. IMC has embarked on the development of an Express Maintenance Program with the assistance of Toyota Motor Corporation. Integration of every department at organization.Key Indicators of How Well the Strategy Is Working Trend in sales and market share The company’s unit sales increased from 29.595 units to a record 35. Acquiring and/or retaining customers IMC has a mission to be delighting their customers and make best possibility of providing the range of products. We have seen increased in Toyota corolla segment by the passage of time except decline in 2008year due to devaluation of currency.23%. Honda and Mitsubishi’s earnings are also very close to each other.53% whereas Honda has 2. we hope to achieve our long-term goal of becoming # 1 in Customer Satisfaction in Pakistan by implementing Customer Relationship strategies and policies that will motivate our CR staff to perform at increasingly higher standards. Our Complaint Handling Procedure provides clear guidelines on how to achieve quick resolution of customer complaints. In living up to this vision.
a 20% increase compared to the dividend payment in 2005. the EPS has continued to decrease due to decline profits.70 and Shareholders Equity was up 40% to Rs 6. The Company’s Return on Equity for the year was 42% (2004-05 of 33%). This increase is due to the high increase in reserves. our total assets have risen by 21% to Rs 16 billion. An amount of Rs 1. Efforts at continuous improvement activities Toyota Indus motors doing continuous efforts for improvement and reducing complaints from customers. • Develop advanced Skill Training Centre to improve the work practices and improve the standard of workforce • Improving Total quality management system across the organization. several other projects are also being implemented. This continuous increase has shown that the stockholders are well catered to and their share in the business has continued to increase. 22 . Currently it stands at Rs 131 with a YoY increase of 9.59) to FY07 (34. Trend in stock price and stockholder value The company's book value has increased consistently over the years. Reserves have continued to increase while no new shares have been issued. These include: • A new Jig Shop for making jigs for future models. They invested large amount in R&D for getting feedback from customers by surveys and questionnaires through dealers. Dividend per share had increased from FY03 (7) to FY07 (13). Overall financial strength and credit ranking There is no doubt that IMC has strong back up and having strong financial strength. This also shows that the management is taking good care of the stockholders interests. • Extensions to our CKD Warehouse and CBU yard. and dealers and also pay attention such activities introduce and improve friendly environment. Onwards. A final payment of Rs 7 per share has been proposed to shareholders. As part of on-going plant expansion.26 billion.705. while the Earnings per Share rose 78% to Rs 33.3 million is recommended for appropriation to the General Reserves that will be utilized for our continuing growth and capacity expansion. This too has been due to the decreasing profits for the company. Earnings per share (EPS) for the company had also showed continuous increase from FY01 (2. making a total payment for the year of Rs 12 per share. vendors.93).1%. and since has decreased to 10 (FY09). During last year.
KI-J activity has been initiated at IMC which involves hazards identification. e-commerce.81 (FY03). visualization and fixing problems on a priority basis. after which it decreased to 7. as per Toyota's CR Activity Ideals. is to create corporate trust based on integrity and fair handling of Inquiries and Complaints by: ● Opening a larger window for customers ● Handling Inquiries and Complaints swiftly and surely ● Making the "Voice of the Customer" the basis for corporate renewal. etc. The price then increased consistently till FY07 when it was 261. It decreased to 253. considering capability and built-in-quality and achieving these targets through team work and cross functional support. This facility will help in reduction of carbon dioxide emissions through the use of natural gas to operate engines and turbines.63 (simple average). the market price of the company's share was 107. Image and reputation with customers During the year. M-Type Jig has been installed for Hilux production which is used in the weld shop for assembly of the main body. Thailand. the Customer Relationship (CR) team focused on putting in place customer-friendly policies and procedures at IMC and its 3S dealerships to achieve quick turnaround on customer inquiries and complaints to maximize Customer Satisfaction. • • For the first time in the history of IMC. Safety and Standardized Work. while the average for FY09 became 137. Toyota took part for the first time and excelled in the Asia Pacific Skill Contest at APGPC (Asia Pacific Global Production Centre). At the end of FY09. Then onwards the P/E ratio increased to 8. During the year. Our vision is to build effective CR. The market price of the company's share was 14.65 (simple average) in FY02. It was 3.72. the Company started the environment friendly Co-generation Power Plant. by setting common targets voluntarily.68 in FY08. as these areas ensure Built-in-Quality. quality.19 in FY02. It is to visualize and share weaknesses globally. training and awareness sessions were conducted to enhance the capabilities of our members in the areas of Quality.80 (FY09). and ●Improving our corporate image and educating customers to support Sales. innovation. In order to achieve the desired targets results.The price to earnings ratio (P/E) has showed variance. and Service activities Leadership role(s) – Technology. from whence it decreased to 2.03 in FY08. • • • 23 . and then plunged down after the collapse of the stock market.37 (a YoY decrease of around -46%).
whereas the renowned brand of IMC is Toyota corolla whose sales and growth are comparatively high than other portfolios. IMC consider its pricing strategy as secondary part of success achievement. retailers or the final customers. Honda charged a bit higher price than IMC product ranges. Toyota use JIT (just in time) approach for handling of raw material. They are stored until they are needed on the production/ assembly line. and they need to be sent along the supply chain to wholesalers. Honda Atlas is very crucial in the providing Quality product to customers. pricing strategy is also strong support to product and brands because it has directly impacts on sales volume of product portfolios. Operations This is where goods are manufactured or assembled.Are the Company’s Price & Cost Competitive? Indus Motors Company has mission to provide quality vehicles by keeping in view customers preference. Toyota motors are known for their reliability which comes from efficient operations. Outbound logistics The goods are now finished. The perception behind that brand make as it talk itself and then customer will attain and will not as such consider price. The value chain of Toyota Indus motors company Primary activities Inbound logistics Here goods are received from a company’s suppliers. 24 . Goods are moved around the organization. IMC’s perception is that quality is the key to attract & retain the customer’s base. The have adopted reasonable pricing strategy as per its product range. on the other hand. Toyota corolla achieved price-quality leadership overall in Pakistan. Toyota motors purchase their raw material from all around the world. Individual operations could include organizing the parts to make new cars and the final tune for a new car’s engine. In order to maximize their availability of raw material Toyota motors maintain good relationship with their suppliers. Toyota motors make their product easily assessable.
Support Activities Procurement This function is responsible for all purchasing of goods. Technology development Technology is an important source of competitive advantage. customer relationship management (crm) and many other technological developments. training and so on. Toyota motors uses following techniques to retain their employees: • Recruitment • • • • Selection Training and development Compensation Maintenance Firm infrastructure 25 . at this stage the Toyota motors prepares the offering to meet the needs of targeted customers. Human resource management (HRM) Employees are an expensive and vital resource. Toyota motors manage recruitment and selection. Toyota values their customers. training and development. Service This includes all area of service such as final checking. Toyota motors will be responsible for outsourcing (components or operations that would normally be done in-house are done by other organizations). internet marketing activities.Marketing and sales In true customer oriented fashion. after-sales service. and rewards and remuneration. Companies need to innovate to reduce costs and to protect and sustain competitive advantage. Toyota motors implemented production technology. complaints handling. service and materials. lean manufacturing. The aim is to secure the lowest possible price for purchases of the highest possible quality. The mission and objectives of the Toyota motors is the driving force behind the HRM strategy. and e-purchasing (using IT and web-based technologies to achieve procurement aims). Toyota motors consider their employees as HUMAN CAPITAL. This area focuses strongly upon marketing communications and the promotions mix.
Mehran and Alto are considered economical and popular among them. So. This segment has very potential to Increase the Sale Volume of Toyota. FORWARD INTEGRATION According to the available Data it reveals that in “Economy Segment” Coure have a strong competitor Mehran due to two reasons: 1) Low Price 2) Number of Dealers Toyota has 32 dealers while Suzuki has 45 dealers. COST LEADERSHIP STRATEGY Suzuki says that it’s become a House hold name because they focus in the Middle and Upper Middle class. Toyota should adopt “Backward Integration Strategy” to overcome expected future problem.a. although Coure is their to this class but it’s so expensive than Alto and Mehran.This activity includes and is driven by corporate or strategic planning. Toyota motors implemented management information system (MIS). Mehran growth p. is 42% while coure just 16% question is why? Toyota should adopt cost leadership strategy to focus Middle and Lower Middle class customer to beat their competitors in 800cc and 1000cc cars. EXPECTED SUGGESTED STRATEGIES BACKWARD INTEGRATION Steel price are going high and it may be cause of increasing cost of product and also create problem in availability of steel which is very key Raw Material of automobile industry. FINAL STRATEGY According our assessment “Backward Strategy” is better for Toyota. and other mechanisms for planning and control in different departments. ( Toyota have a very good Balance Sheet). In this situation Toyota should adopt “Forward Integration” to take control of dealers and number of dealer should be increased. 26 .
27 .If Toyota adopt this Strategy than No change in Vision and Mission Statement.