Università della Svizzera Italiana
Coursework in Corporate Strategy Prof. Erik Larsen
Group Members: Kaloyan Blagoev Mariam Hayryan Robin Müller Dragana Stajic Immanuel Wüthrich Örs Zékany
During the 1990s a global and strong emphasis has been put on the environmental issues worldwide, legally binding documents being signed by governments, obliging to adopt “green” policies. Manufacturers had to follow the governments. Toyota answered to the “green debate” challenge by introducing the first mass-produced hybrid car in 1997. Toyota, the pioneer of Japan’s automobile industry was established as an independent company in 1937. Since 1958 the company has been exporting and started to manufacturing abroad. In 1950 Toyota Motor Sales Company was established which merged into the Corporation in 1982. Managing a truck and four car companies and producing over 5.5 million vehicles per year, Toyota is today the largest automobile producer in the world. The two pillars of Toyota Production System are just-in-time and built-in quality. The Porter’s 5 forces analysis of the car industry for the late 1990s shows low threat of new entrants, as well as low bargaining power of both buyers and suppliers. The threat of substitutes and the competitive rivalry were high. The SWOT analysis for the period between 1990 and 2000 shows that the main challenges of the decade were caused by legal (tariff-barriers) and macro-economical factors (oil crisis 1990, economical crisis 1997 in Asia), while the environmental concern was both a threat and an opportunity for Toyota. Its main strengths were the experience in the “greener” car sector and the introduction of Prius, as well as the successful Toyota Production System. The fact that the company had to recall some cars due to quality defficiencies, was its main weakness. The SWOT analysis looking at Toyota in 2009, shows increasing demands for cars, active cooperation in production and “green image” in Europe among opportunities. The economic situation as well as the current and upcoming competition are threats Toyota faces. The strong international position and being both, leader of the car industry in general as well as in the hybrid automobile segment are listed under strengths. The main weaknesses are the production overcapacities. Forecast predicts yielding the leading position in the worldwide car market to Volkswagen Group, due to its rapid acquisition strategy, though Toyota is still in a strong position, especially with its leadership for hybrid cars. Toyota needs to fit the production capacities to the actual needs to keep the leadership in the environmental-friendly car segment, also in the coming decade.
“…We are striving to create a new automotive paradigm one that contributes to a bountiful society as it helps preserve the Earth’s environment”. Fujio Cho, Chairman Toyota Motor Corporation1
Global environmental problems are indeed among the major challenges of the 21st century and they became a crucial aspect of the corporate social responsibility of big manufacturers. Due to the UN Framework Convention on Climate Change treaty in 1992 and the Kyoto Protocol, which...
Chialin, Ch (2001): Design for the environment: A quality-based model for green product development, in: Management Science, Vol
Toyota to spend $114M on car recall, May 19, 1999, Global News Wire, 1999
Toyota profit surges, but slower growth seen, May 22, 1997, The financial Post (Toronto, Canada), Financial Post Ltd.
Cullision, A.E.(1996): Time running out for Japan’s just-in-time
Please join StudyMode to read the full document