PREPARED BY: S. QURRAT-UL-AIN KAZMI REG ID: 4494 CLASS ID: 9316 SUBMITTED TO: SIR SHAKEEL BAIG DATE: 01 March 2010
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“Toyota seeks to create a more prosperous Society through automotive manufacturing…”
“Toyota aims to achieve long-term, stable growth in harmony with the environment, the global economy, the local communities it serves, and its stakeholders…”
Supporting One Another in Life and Living
We aspire toward the realization of a society in which each individual can live with dignity and hope. To this end, we support efforts to activate the wisdom found in everyday life and to build a good society through mutual support and collaboration among neighbors.
Searching for the Art of Living Better
In today's globalized world, nature is on the verge of crisis, while culture is undergoing a rapid transformation. We wish to contribute to the creation of a beautiful environment and dynamic local culture by nurturing relationships with the people of the world and learning from nature's wisdom, so that everyone can enjoy a compassionate and fulfilling coexistence.
Toward a Fulfilling Future
We support initiatives to enrich the lives and minds of young people, with the aim of fostering the next generation, on whom the future depends. We hope that this will enable the next generation to respect each other's cultures from a broader perspective and to forge a path to the achievement of lasting peace.
New investment by Toyota in factories in the US and China saw 2005 profits rise. • Diversified product range, highly targeted marketing and a commitment to lean manufacturing and quality.
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• In 2003 Toyota knocked its rivals Ford into third spot, to become the World's second largest carmaker with 6.78 million units. Many are now saying that Toyota may become the largest automaker surpassing General Motors by next year. • Uses marketing techniques to identify and satisfy customer needs, and as emphasized by the case video, on customer relationships.
Manufacturers need to make sure that it is their models that consumers want versus competitors. • Most products targeted to the US and Japan only - shifting attention to the Chinese market • Movements in exchange rates could see the already narrow margins in the car market being reduced. • Company needs to cautiously keep producing cars in order to retain its operational efficiency, especially in the case of the Prius, which the case study states had a backorder dating back six months.
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Lexus and Toyota now have a reputation for manufacturing environmentally friendly vehicles. Lexus has RX 400h hybrid, and Toyota has it Prius. Rocketing oil prices have seen sales of the new hybrid vehicles increase. Toyota has also sold on its technology to other motor manufacturers, for example Ford has bought into the technology for its new Explorer SUV Hybrid. Toyota is to target the 'urban youth' market. The company has launched its new Aygo, which is targeted at the streetwise youth market.
In 2005 the company had to recall 88,000 SUVs and pickup trucks due to faulty front suspension systems. Toyota faces tremendous competitive rivalry in the car market. Competition is increasing almost daily, with new entrants coming into the market from China, South Korea and new plants in Eastern Europe.
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Toyota aggressively marketed their cars to Americans as being fuel-efficient environmentally friendly small size and having better build quality than other Brands. In the 1980's they had people tell the story of hitting 100,000 miles in their Toyota while other different cars were died at 80,000 miles. Toyota found that many of their cars were going 200,000 miles. That was a huge marketing success and it didn't even cost much money. (Building a Quality Brand Strategy). Now TOYOTA team is improving by concentrating on being a "green" company that cares about the environment. Diversity in their products which maximize market share, profitability of the company as all the society sectors (Youth, Men/Women, rich) are being served with products that are under their convenience.
Overseas production for reducing labor cost. Building a Huge Dealers network overall the world, that’s made their products reachable for all around the world. Built the best system (TOYOTA Production system-TPS) that organizes manufacturing and logistics for their automobile manufacturer, including interaction with suppliers and customers. Their system has proven its effectiveness through the past and present. And Now TPS system being studied & followed by other automakers. After many years of the excellence TOYOTA brand become known in selling a high quality, low maintenance, reliable and fuel efficient vehicles with widely available spare parts. By the excellent reputation that TOYOTA has built through the past, their cars have got the best resale value. This participates in “Captives Customer” and maximizes customer retention, market share, profitability and maximizes Net marketing contribution. In the past TOYOTA MOTOR COMPANY has lunched “Scion” for youth market, because the younger customer has a greater "lifetime value" to the company. (The younger person has more car purchases in his future than does the older one).
Individuals overall the world
SCION - Youth market (16-30) College degree, median income $30,000-$50,000 per year. TOYOTA - Medium class (25 and up), college degree, median income $40,000 and up
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LEXUS - Toyota's luxury division (35 and up), college degree, median income $65,000 and up. Companies. Manufactories. Institutions.
Following are the current Toyota Brands Cars • Yaris • Corolla • Matrix • Camry • Camry Solara • Prius • Venza • Avalon Trucks • • • Tacoma Tundra Hilux (VIGO)
SUVs and Vans • • • • • • • Rav4 FJ Cruiser Highlander Sequoia 4Runner Land Cruiser Sienna
Hybrids • • • Prius Camry Hybrid Highlander Hybrid
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THE MARKETING MIX
Corolla is a goods and service combination that Toyota offers to the consumers. It comes in various models like 1300 cc Xli and Gli, 1800 cc Altis and Diesel 2.0D Saloon. The 1.8 Liter VVTi Altis and 1.3 Liter VVTi Xli and Gli are suited for roads of Pakistan. The car comes in choice of 9 metallic and matte finished colors. Various options like Automatic/Manual transmission and sunroof are available according to choice of the customer. Safety goes beyond the structural designs to ensure maximum passenger protection. Included are SRS airbag, whiplash injury protection system, seat belts with pretension force limiter, ABS with Brake assist, and LED lamps. Diesel models are also available.
Toyota Corolla has always had a lower price tag as compared to most of its competitors. The new base model Corolla is available for Rs 1,269,000 as compared to Rs 1,525,000 Honda Civic. The price is considerably higher than Rs 1,070,000 Suzuki Liana and Rs 1,050,000 Honda City. But Corolla has always proved to be worth every rupee.
Toyota's corporate philosophy revolves around customer satisfaction, which is symbolized in the 3S Concept. Toyota is the Pioneer in the 3S System, which offers Sales, Service and Spare Parts all from the same facility. Toyota has 30 dealers all over Pakistan, including major cities of Islamabad, Lahore Karachi, Multan, Quetta, Peshawar and other cities like Hyderabad, Sialkot, Dera Ismail Khan, Faisalabad, Gujranwala, Mardan, Mirpur Azad Kashmir, Rahimyar Khan Rawalpindi, Abbotabad and Sargodha. Indus Motor Corporation and its service Department has undertaken extensive training of its dealer' service staff by conducting over 30 specialized course a year for service managers/service advisors, service Engineers and Technicians. Over 200 mandays are devoted each year to Service Training.
Extensive promotion of Corolla is carried out through TV commercials, newspapers, broachers, websites and banners. Dealership salespeople assist potential buyers and persuade them that Corolla is the best car for them. Indus Motor Corporation is also running a Toyota Club program to create community of Toyota Corolla owners.
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Toyota Corolla uses multiple segmentation techniques to segment the Pakistan market. Corolla segments the Pakistan market demographically according to income: • Upper Class • Upper Middle Class • Lower Middle Class • Lower Class It also segments the market according to company loyalty. Corolla has been in Pakistan for decades and has a huge following of Corolla fans that prefer a Toyota Corolla over anything else. Toyota Corolla segments the market geographically as well and along with major cities, also concentrated on rural areas where there are no dealerships of its competitors.
About a decade ago, the major target segments of Toyota Corolla were Upper Class and Upper Middle Class. But with introduction of consumer finance and property boom, the target segments changed. As the upper class moved to more distinguished vehicles like BMW, Mercedes Benz or likes of Honda Accord and Toyota Camry, Toyota Corolla targeted the Lower Middle Class. This is a much bigger segment as compared to Upper class and thus the sales increased from 4,761 in 1995-96 to 35,762 in 2006-07. It targeted the income segment which could afford a lesser priced car in the past and persuaded them to purchase a Toyota Corolla through financing from a bank.
Over the years Toyota Corolla has positioned itself as a multi-dimensional vehicle in the minds of consumers. It is a work horse with durability and very easy access to spare parts and repair. Companies which need fleets of cars like Rent a Car, Huge Corporations or Radio Cab companies prefer Toyota Corolla over anything else. The major reason is lower price as compared to other vehicles, low maintenance cost, durability and resale value. At the same time, Corolla is also positioned as a luxury sedan, a status symbol. In the status conscious market of Pakistan, this positioning played in the favor of Toyota Corolla as Lower Middle Class looked to purchase luxurious cars.
KEY SUCCESS FACTOR
Quality of parts used.
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Best quality control to monitor manufacturing process to ensure there are no manufacturing defects. Better customer service to facilitate customers. Reduction in prices.