Report Toyota
Headquartered in Toyota, Aichi, Japan, Toyota Motor Corporation is a Japanese automotive manufacturer with 338.875 employees worldwide, as of March 2014. Being the twelfth-largest company in the world by revenue, Toyota is the world’s first automobile manufacturer to produce more than 10 million vehicles per year. It is also the number one automobile manufacturer in Japan, the third largest manufacturer in the world by unit sales, but number eight in sales in Continental Europe. Founded by Kiichiro Toyoda in 1937 as a spinoff from his father’s company Toyota Industries, the multinational corporation produces vehicles under 5 brands today, including the Toyota brands, Hino, Lexus, Ranz and Scion.
1) There is a high demand for automobiles in Europe and the domestic Japanese market may lack the size to support efficient scale manufacturing facilities, hence sparking Toyota’s move of its manufacturing for European sales into Europe. However, the delay could be due to Toyota’s decision to maintain control over manufacturing and marketing on domestic grounds. The original international entry mode into Europe was via exporting and this involved low expense to establish operations in Europe. Toyota could have aimed to minimize cost and at the same time, gauge the perceptivity from the European consumers before shifting its manufacturing for European sales to Europe. In addition, this allowed Toyota to gain higher potential returns and without the risk of any licensee imitating technology and product for its own use.
In 2001, only 24% of the autos sold in Europe were manufactured in Europe, the remainder being imported from Japan. Toyota eventually shifted its manufacturing operations for European sales over to Europe, despite the costly venture. This could be due to the high transportation costs and tariffs imposed as a result of exporting manufactured goods from Japan to Europe. Furthermore, the competitors in Europe are growing fast and the need for global
1) There is a high demand for automobiles in Europe and the domestic Japanese market may lack the size to support efficient scale manufacturing facilities, hence sparking Toyota’s move of its manufacturing for European sales into Europe. However, the delay could be due to Toyota’s decision to maintain control over manufacturing and marketing on domestic grounds. The original international entry mode into Europe was via exporting and this involved low expense to establish operations in Europe. Toyota could have aimed to minimize cost and at the same time, gauge the perceptivity from the European consumers before shifting its manufacturing for European sales to Europe. In addition, this allowed Toyota to gain higher potential returns and without the risk of any licensee imitating technology and product for its own use.
In 2001, only 24% of the autos sold in Europe were manufactured in Europe, the remainder being imported from Japan. Toyota eventually shifted its manufacturing operations for European sales over to Europe, despite the costly venture. This could be due to the high transportation costs and tariffs imposed as a result of exporting manufactured goods from Japan to Europe. Furthermore, the competitors in Europe are growing fast and the need for global
References: 1) Toyota. (n.d.). Retrieved April 11, 2015, from http://en.wikipedia.org/wiki/Toyota 2) Welcome to Toyota Singapore. (n.d.). Retrieved April 11, 2015, from http://www.toyotasingapore.com.sg/ 3) Hitt, M., & Ireland, R. (2007). Management of strategy: Concepts and cases. Australia: Thomson/South-Western. 4)