Toyota and Volkswagen supply chain management

Topics: Automotive industry, Volkswagen Group, Supply chain management Pages: 20 (4873 words) Published: August 14, 2005

This assignment gives the overview of the Toyota and Volkswagen. It also explains about their supply chain relationship of those manufacturers. It also gives the advantages and disadvantages of those companies. I have also compared the strategies of Toyota and Volkswagen. I have collected some details regarding the future scope and threats for both the manufacturers. I have given some general statistics of both the companies. Then I have given some future strategies of those concerns.


Supply chain: Supply chain encompasses all activities associated with the flow and transformation of goods from the raw materials stage (extraction) through to the end user all well as the associated information flows. Material and information flow both up and down the supply chain.

Supply chain management: supply chain is the integration of these activities through improved supply chain relationships, to achieve a sustainable competitive advantage.


In this modern world automotive sector is a rapidly growing sector in various aspects. The automotive manufacturers are developing new products according to the latest trends. Meanwhile the competition in this field is also increasing to a great extent. To sustain in this day-by-day increasing competition, the automotive manufacturers all over the world are in a position to update their product according to the modern trend and to make products by reading the mindset of the customers to stay and develop in the market. Other than these two main aspects they are in a position to concentrate on their product quality, reduction in lead-time and they should be in a position to supply their products at a competitive price.

The above seen aspects should be achieved during the design and the production stage of the product. It is impossible for a company to make this happen unless they receive the quality product in right time at the right price from their suppliers because these automotive manufacturers greatly rely upon the suppliers for nearly 80% of their components. So the performance of the supplier reflects on the performance of the manufacturer. So the manufacturers should concentrate on whole supply chain to develop their product rather concentrating only on their company. This is possible only when the manufacturer and the supplier works together to solve their problems and evolve a cost effective and quality product in right time. The above-mentioned out put is possible only when the relationship between the supplier and the manufacturer is healthy. This healthy relationship leads to the competitiveness in the market for the manufacturers.

In this modern automotive trend the manufacturers work a lot to develop their product by developing their existing supply base and by developing the new supply bases. To make this happen different companies work out different strategies. Volkswagen and Toyota are two leading competitors in the globe today. Volkswagen is Mexican company and Toyota is Japanese company, both the concerns use different methodology to increase their competitive advantage but both the companies concentrate mainly in improving the existing suppliers capability and performance.

In this assignment we are going to see the difference in approach of both manufacturers and the comparison between their approaches. For simplicity we are dividing the approaches as western approach (Volkswagen) and Japanese approach (Toyota). We are going to see the success and failures of these companies by adopting their strategies. We are going to see the future trends in general for the future automotive manufacturers development.


Toyota Motor Corporation develops and manufactures vehicles, and is one of the largest car manufacturers in the world offering a wide range of products from mini vehicles to trucks. In addition to its core business, Toyota has a large business portfolio in financial...

References: WWW.TOYOTA.COM
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