Assignment 3:  Case 7-2 “Carmakers Target Gen Y”

The purpose of this report is to become familiar with research tools, to introduce a framework for secondary industry research and gain to practical experience in creating an executive summary. This research paper looks at a broad set of indicators on the Canadian new vehicle industries. The Canadian automotive industry produces light duty vehicles — cars, vans, pickup trucks; heavy duty vehicles—trucks, transit buses, school buses, military vehicles; and a wide range of parts, components, and systems used in vehicles of this nature. To complement its manufacturing activities, the industry boasts a well-developed vehicle dealer network, plus an aftermarket organization which has grown into a world-class distribution system and service provider (Canadian automotive industry, 2014). Canada accounts for a small amount of 4.6% of the Americas new cars market value (New Cars in Canada, 2016). Throughout the project I became more aware of how much the industry is worth. The worlds automotive industry accounts for around $1 trillion in annual sales. (Canada’s Auto and Auto Parts Industry Industrial Outlook, 2006). However, in 2015 the Canadian new cars market had total revenues of $15.0 billion. The market is expected to grow substantially by 18% in 2020 (New Cars in Canada, 2016).

They have specific qualities they search for in cars, like affordability, quality and durability. They are vey conscious about safety and low price, and don’t have brand loyalty.

Ideas introduced in the article assist in understanding Ford’s current situation. Ford reported sharp falls in U.S. auto sales in May 2008. Sales of its most profitable pickups and SUVs suffered the most (“US Auto Sales Slide”). Some of the main

I will be comparing both companies General Motors Company and Ford Motor Company for the past three years. We will be able to see all the trends these two automotive manufacturers have and which one may be better to invest in by looking at the last few year’s ratios and percentages. This will give us a better understanding and the knowledge of who maybe the industry leader and who is the follower. These are both major corporations that strive off customer loyalty and both competing on a global scale to make their mark in the one of the top automotive manufacturers in the world. This analysis will give us an understanding of what lies ahead in the future for these two manufacturers.

In the previous couple of years, purchasers have requested an ever increasing number of autos that are reasonable as well as fuel-proficient. This ascent popular is because of the changing variables in the essence of the purchasers, the ascent in populace, the rising salary, the ascent in costs of substitutes, and the drop in the costs of supplement items and administrations. Honda and Toyota have both made a significant entirety of cash by exploiting the chance of these ascents sought after.

Competition is good for producers but better for consumers, more competition in the market means more: ideas, channels of distribution, market stability and competitive (lower) prices for consumers. Ultimately, healthy competition forces producers to offer better products and services at lower prices. Automobiles provide people with “…aspirational value in addition to a basic mode of transportation…” (Reinhardt, Yao & Egawa, 2006) consumers make purchasing “decision based on the styling, color, and concept of the cars in addition to functions and pricing” (Reinhardt, Yao & Egawa, 2006). So far, TMC has been trying to catch up with Honda and Nissan in the ‘innovative’ department. Let’s not forget the criticism the company previously faced for offering its customers “…proliferation of look-alike cars…and following rather than setting a trend” (Reinhardt, Yao & Egawa, 2006).Since, Mr.

Ford Motor Company has been in business since the 19th century and it has enjoyed a rather successful run as one of the top automobile industries in the United States. Ford Motor Company is a prosperous business because of strategic changes that it was willing to develop and implement. Successful corporations have to adapt to the constantly changing environment or the company will be doomed to failure. In other words, customer shopping habits change as new products are introduced to the market or when other factors beyond Ford Motor Company’s control affect which vehicles are sold. For example, there is an increased demand for fuel efficient cars when the price per gallon of gasoline increases. In its long history, Ford Motor Company has demonstrated the willingness to cut its losses and try innovative techniques in order to maximize profit and maintain customer satisfaction and sustainability. Although the company no longer resembles the same corporation that Henry Ford built, it remains an example of how successful businesses should adapt to their changing environment by being receptive to different strategies.

Recommendation: Toyota should continue developing the Prius, despite the technical difficulties present at the moment. The company’s kaizen maxim is the most reliable tool to guarantee that, once mass-production of the Prius starts, the new model will comply with Toyota’s efficiency and reliability standards. The value created by the Prius is not only that of uncovering a new possible market, but of making Toyota a carmaker that sets the standards of it (Exhibit D). Okuda should continue to pressure the G21 to produce a safe, reliable and innovative car. The Prius should be produced by 1997 to avoid other companies winning the race, as happened with the Direct Injection technology. Additionally, the Prius should be marketed first in Japan. Japan is not only Toyota’s largest market (allowing to have more cars to be evaluated by the production line staff); but also the gasoline prices are the highest among its different markets, a car 100% more fuel-efficient would be of great value for potential buyers. If the car probes to be a success, Toyota will have in its hands a product able to be commercialized to its other markets in America and Europe. The hybrid powertrain will not only make Toyota a

In 2003, Toyota Motor Company decided to open a new branch directly aimed towards the younger generation. Toyota decided to name the company Scion and build vehicles that would be desirable to 18-30 year old. What seemed to be a great idea at the time did not last longer than 15 years before it was shut down and dissolved back into its big brother company, Toyota. Various articles were released, each presenting a different spin on the story. However, it was obvious that Scion created a clear goal, yet failed to form a structured business plan.

b. Start over and by 1960 Toyota has a new Toyopet that can withstand American conditions

One of the best ways of improving corporate image in the automobile industry is by ensuring that the industry satisfy the needs of consumers. These needs would include the utility derived from their product, the safety assurance of the brands and the overall best performance in the lifetime assessment as for the environmental effects. There is a global concern over the carbon dioxide emission in the Automobile industry and the consumers are now given a chance to adopt a lifestyle that is caring to the environment. The electric and Hybrid brands have promised to revolutionize and rival the traditional cars in their economy on fuel and their friendliness to the

Manufacturers create multiple product lines to sell to multiple price sensitive groups (Simchi-Levi, Kaminsky & Simchi-Levi, 2008, p. 397). Toyota and all other automotive manufacturers use product versioning to separate and capture both the high-end and low-end customers. Toyota uses product versioning in multiple ways; it is used by creating different styles of vehicles as well as different classes of those vehicles. Toyota creates multiple sizes of sedans, SUV’s and Trucks. Within sedans there is the Prius, Corolla, Camry and Avalon. In the SUV category, they produce the Rav4, Highlander, 4Runner, and Sequoia. The Tacoma and Tundra are produced within their truck category. These different vehicles come in different packages that provide different options that segment customers into their buying desires, based on price conscience or those wanting higher end finishing’s. As an example, if two customers both purchase a Camry from the same dealership, one customer may want an entry level package with just enough options to have a vehicle to drive. The other customer may want every option available on the Camry. Both customers purchased a Toyota Camry, yet the actual vehicles they received have major differences and very different prices. By having multiple options of the same vehicle, Toyota is able to capture multiple groups of customers.

The Scion on the other hand targeted the young that were seeking a product that is affordable, high performing and is a modern style alternative to Toyota's existing lineup. Toyota also used this style and brand to build brand loyalty as a byproduct of their strategy. Both automakers applied Demographic Segmentation portions such as age distribution, income levels, and gender (Element) considerations. Next, they used portions of Psychographic Segmentation, which involves grouping people in terms of attitudes, values and lifestyles. I see this strongly in the Scion strategy. Another part of their strategy is the primary source of advertising. For the targeted groups they are marketing to, their strategy had to be different. To reach generation Y population, it was best suited to reach them through various untraditional venues such as via internet, which is where Gen Y spends most of their time. Traditional advertising means seemed to turn the Gen

When buying a car today, many aspects come into role play, and two of the most important factors are reliability and durability. Many cars have a bad reputation; many GM vehicles are known to die out after reaching 100,000 miles. When buying a car, the owner would appreciate it if he or she can sell the car after reaching a certain amount of miles, and not have a problem selling it. It is important for any person to feel confident that his or her vehicle will not die out quickly and can last a long time. Many American cars have a bad reputation for being known to die out quickly. Many foreign car manufacturers like Toyota have a good reputation and are known to make vehicles that can last up to 500,000 miles if used well. This has a big impact for anyone in the reliability and durability aspect, because he or she doesn’t need to worry about the car dying out quickly, or if he or she can sell it after some time. There are a lot more cars on roads today, then the amount there were in the 60’s, 70’s or the 80’s. Meaning that, there are a lot more accidents and a lot more deaths and injuries that are caused from automobile incidents. Safety has an important role when a car is being bought, people check for specifications such as

Thus far, our product strategy of successively expanding our model range, from smaller cars to luxury sedans, full-sized pickup trucks, large SUVs, and crossover vehicles has proved successful. In a bid to further extend our customer base, we have established the Scion marketing group, which will develop a range of vehicles targeting young, first-time car buyers. With respect to environmental issues, Toyota’s hybrid automobile Prius, which was introduced to the North American market in 2000, has been extremely well received and development is under way to launch our next-generation hybrid car. The Company intends to