-Short background of a company-
Motor Co. was established as an independent and separate company in 1937.
Although it is founding family’s name was written in the Kanji
(“Toyoda”), the company name was changed to a similar word in katakana –
(“Toyota”) because the latter has 8 strokes which is
regarded as a lucky number in East Asian culture. Headquarters are located
in Toyota City, an industrial city in the east of Nagoya, Japan. Toyota Motor
Corporation began to exist in 1933 as a division of the Toyoda Automatic Loom
Works, Ltd. (later Toyota Industries Corporation, now a subsidiary), a Japanese
manufacturer who was founded by Toyoda Sakichi. Its first production car, the
Model AA sedan, was released in 1936. The following year the division was
incorporated as the Toyota Motor Company, Ltd., an automotive spin-off headed
by Toyoda Kiichiro, Sakichi’s son. Toyota subsequently established few related
companies, including Toyoda Machine Works, Ltd. (1941), and Toyota Auto Body,
Ltd. (1945). However, faced with particular facilities and a crisis economy in
the time of World
War II, the company was forced to temporarily stop
its automotive production.
By the 1950s
Toyota’s automobile production factories were back in operation, and in order
to gain competitiveness the company began a careful study of American
automobile manufacturers, owing to perceive U.S. technical and economic
techniques. Today Toyota assembly plants and
distributes also in many countries. In addition to automotive products, its
subsidiaries manufacture rubber and cork materials, steel, synthetic resins, automatic looms, cotton
and woolen goods. Others deal in real estate, housing units, along with the
import and export of raw materials.
– Business Model –
For more precise allocation of areas of
responsibility and quick decisions, the automotive business of Toyota Motor
Corporation will be divided into 4 main structural units from April this year,
which will autonomously determine the most interesting and suitable business
models for sustainable growth in the world market.
– “Lexus International” (will unite all work on the brand in the
– Toyota No.1 (will be responsible for all Toyota brand operations in Europe,
including Russia, North America and Japan);
– Toyota No.2 (will be responsible for all operations for the Toyota brand in
Asia, East Asia, the Middle East and Africa, Latin America, Oceania and the
– “Components” (development and production of transmissions, engines
and other works in the market of spare parts and auto components).
purpose of the work of the structural unit of Lexus International, formed in
June 2012, is the centralized management of all operations that are somehow
connected with Lexus cars and the strengthening of the image of this brand as a
premium brand with the quality of Jaan.
business units Toyota No1 and Toyota No.2 will be handed over to executive
vice-presidents of Toyota Motor Corporation. Under their responsibility will be
a comprehensive development of the Toyota brand in various markets: from
development and production to the implementation of finished cars.
structural unit “Components” will unite all operations of the company
Toyota in the world for the development, production and putting into the world
markets of auto components, including engines and gearboxes, and spare parts.
Responsible for the operations of the business unit will be the Executive Vice
President of Toyota Motor Corporation.
Corporation’s organizational structure is based on the different business
operations of the company around the globe. As one of the world’s leading
automobile manufacturers, Toyota hires its organizational structure to support strategic
direction and business goals. This structure is also connected to the
traditional organizational structures used in Japanese businesses. The effectiveness
of Toyota in maintaining a powerful global appearance shows its ability to use
its organizational structure to maximize capacity and efficiency utilization.
And this organizational structure is actually contributing to Toyota’s success
in the global market.
main task of Toyota’s production system is to increase profits by reducing
production costs, that is, by eliminating the costs of unnecessary supplies and
labor. The concept of costs in this case is very broad. Typically, these are
past, present and future cash outlays derived from sales revenues. Thus, costs
include not only production costs and distribution costs. In order to achieve
cost reduction, production must adapt quickly and flexibly to changes in demand
in the market. The external environment of an organization is conditions and
factors that arise independently of its activities and have a significant
impact on it.
factors affecting the external environment of Toyota Motor LLC are factors of
the business environment and factors of indirect impact.
of the business environment of LLC “Toyota Motor” consist of:
Consumers – consumers of manufactured products are almost the whole contingent
of men, women from 18 to 70 years. These are people who constantly use the services
of service centers, attending various presentations of new Toyota brands.
Suppliers – from the position of macroscopic representation, the organization
is a system for converting “inputs” and “outputs”. The main
types of inputs are labor, materials, equipment, energy, capital.
relationship between Toyota Motor LLC and the suppliers that provide input of
these resources is the direct impact of the external environment on the
organization. Variability of quality and price of resources creates certain
Materials – the inability to provide supplies in the right quantities and in
the required time can create great difficulties for Toyota Motor LLC.
a supply system requires close cooperation of Toyota Motor LLC with suppliers.
Capital – for the growth and prosperity of Toyota Motor LLC, we need
“suppliers” of capital. There are many types of potential investors –
banks, investment and credit programs, shareholders, private individuals.
Competitive environment – Japan’s main competitors (Toyota) in the direction
of: the manufacture and sale of cars are: Europe (Honda, Nissan and Ford
Motor.) and America (General Motors).
Partners – an authorized partner is a company that is authorized by Toyota
Motor LLC for retail sale, as well as warranty and non-warranty maintenance of
Toyota cars during the construction period in the region of the Authorized
Partner of the dealer center of Toyota LLC.
– International Expansion-
When segmenting the market and identifying the target audience, Toyota
is guided by its famous philosophy “the right car in the right
place.” Considering the market of each country separately, the company,
nevertheless, allocates several global centers of concentration of its
activity. The US market is an unconditional priority of the company. This is
due to the fact that 25% of all manufactured products are consumed in the USA,
that is, almost as much as in Japan itself.
The European market remains for the company the most unknown and, at the
same time, the most promising. In Europe, the company sells only 11% of its
total production. Toyota has developed its market strategy at different levels
– globally, regionally, and nationally, based on an assessment of customer
needs. One of the key factors for designing the strategy of segmentation,
targeting and positioning of Toyota is always an analysis of the state of the
market, the economy, the purchasing power of the target audience and its
The basic elements and at the same time orienting Toyota’s marketing
planning, which allowed the company to win the trust of customers, are the
? Ecological cleanliness of the
? Product safety
? Low operating costs of the product
? Quality after-sales service
In 2010, the company set itself an ambitious goal of growing a 15% share
of the world market by 2015. In this regard, the European market is of special
strategic importance. Sales in Europe are quite sensitive to the external
circumstances of the economic environment and before falling to the level of 9
years ago almost doubled.