Threat Of New Entry ( Weak )

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Threat of New Entry (Weak): • Large amount of capital required • High retaliation possible from existing companies, if new entrants would bring innovative products and ideas to the industry • Few legal barriers protect existing companies from new entrants • All automotive companies have established brand image and reputation • Products are mainly differentiated by design and engineering quality • New entrant could easily access suppliers and distributors • It is very hard to achieve economies of scale for small companies • Governments often protect their home markets by introducing high import taxes Supplier power (Weak): • Large number of suppliers • Some suppliers are large but the most of them are pretty small • Companies…show more content…
The company 's market share for Toyota and Lexus brands, (excluding mini vehicles) in Japan was 45.5% in FY2012. Similarly, Toyota has a market share of 12.2% in North America, 13.4% market share in Asia (excluding Japan and China), and 4.3% market share in Europe. In addition, the company holds a 7% share of the Chinese market and a significant market share in South and Central America, Oceania, Africa and the Middle East regions. Such strong market position allows the company to gain competitive advantage and also expand into international markets. In addition, Toyota holds a portfolio of strong brands in the automotive industry. Thus, the company 's strong market position gives it significant competitive advantage and helps it to register higher sales growth in domestic and international markets. Strong focus on R&D: Toyota has a strong focus on R&D to expand its product portfolio and improve the functionality, quality; safety and environmental compatibility of its products. The company 's R&D efforts are directed at developing new products and processes and improving the capabilities of existing products. The company conducts its R&D operations at 14 facilities worldwide. Strong focus on R&D
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