Toyota Group And Its Organizational Strategy

Toyota was thought to be the best quality car in the 1970s and 1980s but, due to Japanese competition, American car manufactures soon began to close the rankings gap. At the top of their game in 2010, Toyota had to stop manufacturing and order a large recall of automobiles. While leadership was probably considered great at the height of Toyota’s success, changes were obviously needed during the recall period and management needed to be as adaptable to those changing conditions. The only thing regarded as permanent in a market economy is change

Cole, R. E. (2011). What really happened to Toyota? MIT Sloan Management Review, 52(4), 29-35. Retrieved from http://search.proquest.com.library.capella.edu/docview/875531966?accountid=27965

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Ever since the 2008 recession US automobile companies have been on a steady downhill slide, but actually you can trace this downward trend even further back than 2008. US car companies have been feeling the heat since as early as the late 1980s when Japanese car companies laid claim to American manufacturing plants . Despite a shot in the arm in sales over the past five years, American firms are still on the decline. This case analysis aims to diagnosis the problem, provide analysis of the problem, and propose a viable solution to the problem from the perspective of the US automobile market share leader, General Motors.

The American automotive industry began in the 1890’s. It evolved into the largest industry in the world as a result of the size of its domestic market and mass production.the American auto industry began with hundreds of manufacturers, but by the end of the 1920’s it was dominated by three large companies, General Motors, ford and Chrysler. By the end of the Great Depression and world war 2 these companies prospered making the U.S the country which provided three quarters of the worlds vehicle . They however did not remain number one, Japan overtook the market in the 1980s and China in 2008., making the U.S second in the world. The impact of the global market caused the American auto industry to suffer considerably. Japan and China were producing more vehicles at cheaper prices. Labor cost were cheaper therefore companies took their factories to these countries. In 2008 the American auto industry was on the brink of collapse . Access to credit for loans decreased and sales plunged by 40 percent. Chrysler and GM both sort

Up until about the 1960s, the Big Three dominated the automotive landscape in the United States. The oligopolistic trio topped out at about a combined 90% market share in a domestic industry with only seven remaining producers (International Encyclopedia). The intra-industry domestic rivalries experienced a new foe beginning in the 60s. Starting with Volkswagen and Toyota, foreign competition began to chip away at the Big Three’s stranglehold of the US market.

us that are old, enough to remember how the Big 3 automakers almost collapsed back in the late 70's, early 80's, the world was made aware of the troubles in these plants. The autoworkers seemed to be sucking the companies dry with their extravagant labor agreements, while their levity, quality and design of their product was lackluster. The oil embargo that OPEC orchestrated also revealed a problem with U.S. automakers, they were unwilling to adapt to the changing environment around them. Meanwhile the Japanese automakers were busy making fuel-efficient, smaller, less expensive vehicles; the Big 3 resisted this change with their very fiber. They continued to crank out their muscle cars, and their gas-guzzlers. Consumers lost confidence in the U.S. automobile and quickly switched to the cheaper more fuel-efficient Japanese models.

With the increase of global competition, the manufacturers of vehicles in the US had been negatively

The Auto Industry in the United States has flourished ever since it’s revolution in the early 1900s. “Although the blueprint for the modern automobile was perfected in Germany and France in the late 1800s, Americans dominated the industry in the first half of the twentieth century. Henry Ford innovated mass-production techniques that became standard, with Ford, General Motors and Chrysler emerging as the “Big Three” auto companies by the 1920s (Foner & Garraty 1991).” Henry Ford’s focus was to produce an automobile that could be accepted by middle class Americans. The American automobile industry is subject to global competition like any other industry. As stated earlier, the automobile was first perfected in Germany and France. In 1995, the United States and Japan made a trade agreement that provided more dealer outlets and allowed easier replacement part selling in each other’s countries (Nauss 1995). This makes auto parts and auto-replacement parts for Japanese cars easier to access in the United States and vice versa. Not only does this provide for more US jobs, but it also provides for more Japanese jobs in the auto industry (Nauss 1995)! But furthermore, it increases the global competition. “Japanese automotive manufacturers include Toyota, Honda, Daihatsu, Nissan, Suzuki, Mazda, Mitsubishi, Subaru, Isuzu, Kawasaki, Yamaha, and Mitsuoka. Cars designed in Japan have won the European Car of the Year, International Car of the Year, and World Car of the Year awards many

Asian and European car manufacturers became major threats to the US market shares. The economic

As any other industry, the automobile industry is not without its fair share of global challenges. In 1982, Honda opened the doors to its first US auto plant. Two years later, in 1984, Toyota entered into a “joint venture with General Motors called the New United Motor Manufacturing Inc., (NUMMI). Later, in 1989, the company launched its luxury division, LEXUS, creating a multinational approach to automobile manufacturing, with an increase in product sales soaring in the USA (Toyota Company History, (n.d.).

The network is extremely complex to operate and manage. Toyota’s size enables it to maintain control over the logistics network by partnering with Third party logistics companies. The logistics partners provide a dedicated fleet of trucks and drivers to operate Toyota’s logistics network. In addition, the entities in the network work closely with Toyota to design and plan routes. The shared transportation enables suppliers to receive small orders without increasing transportation costs.

Comparison and Contrast of General Motors and Toyota Motor Thomas Hong, Ph.D. The Impact of Technology on Organization University of Phoenix November 12, 2007

We will start the external analysis with the PESTEL analysis of the automotive sector followed by the Porter’s five forces analysis and we will end by having a look at the key competitors and competitor pricing.

Toyota also has a strong portfolio of prestigious brands such as Prius, Camry, Toyota, Lexus, Corolla, Land cruiser, Hilux and other brands. In fact, the annual Brands Top 100 ranked Toyota a leading brand. This strong branding and market position allows Toyota to market its product with premium prices and high profit margins.