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Current Opportunities, Threats, and Actions for Toyota

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Like other companies, Toyota operates in a complex global industry. In order to develop and execute a successful strategy, the Toyota corporation must take into account the global automotive environment.

To complete Module 2 Case Assignment, please read the information in the background material, look for more information, and then write a 4 to 5 pages report for your professor and the executives of Toyota corporation by answering the following questions:

i) What are the current opportunities for Toyota?

ii) What threats are they facing?

iii) What actions are they taking to respond to these environmental contingencies?

iv) Based on your analysis and findings, what actions should they take? Please provide some recommendations in brief.

Step 1: Return to Toyota's annual report (http://www.toyota-global.com/investors/ir_library/annual/pdf/2009/pdf/p10_16.pdf) and read what the chairman and the president say in their introductory messages are the biggest external threat and opportunity facing Toyota. Then read what some independent analysts are saying:

Anonymous (2010). TrueCar forecasts April auto sales and incentives spending; Industry sales up 23%; Toyota incentives reach record highs. PR Newswire. Retrieved August, 2011, from http://proquest.umi.com/pqdweb?did=2015705341&Fmt=3&clientId=29440&RQT=309&VName=PQD

Investopedia.com (2011). The industry handbook: Automobiles. Investopedia. Retrieved August, 2011, from http://www.investopedia.com/features/industryhandbook/automobile.asp

Hitokoto, T. (2010, May 13). Big carmakers back on the road. Yomiuri Shimbun (Japan). Retrieved August, 2011, from http://web.ebscohost.com/ehost/detail?vid=3&hid=14&sid=1d339a39-33fa-4450-aa6f-4440ea5ed390%40sessionmgr4&bdata=JnNpdGU9ZWhvc3QtbGl2ZQ%3d%3d#db=nfh&AN=2W63667972997 (Ebscohost library)

Please use the following steps to access articles from Ebscohost library:

i) Type website: http://search.ebscohost.com

ii) Type user ID and Password: Username: s3642728; Password: welcome

iii) Click on "Image Search"

iii) Type the name of the article (e.g., Big carmakers back on the road) and then click on "search"

Step 2: Drawing on the background and case materials, and any additional source if you choose, identify two main threats and two major opportunities facing the automobile industry. Do the executives at Toyota and the independent analyst agree?

Step 3: Browse through the annual report and locate ways that Toyota is addressing these threats and opportunities.

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The solution discusses current opportunities, threats and actions for Toyota.

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Current opportunities:

Company Spotlight (2010) provides that Toyota has the opportunity to benefit from increased demand for hybrid electric vehicles whereby demand is estimated to be 4 million units by 2015. Increased demand for hybrid electric vehicles id driven by increasing cost of fuel and strict regulations on emissions. Company Spotlight (2010) provides that the primary market for hybrid electric cars include the United States, Western Europe and Japan.

In Toyota Annual Report (2010) the company's President provides that next generation eco cars pose as pillars to the company's growth. Toyota is looking into the development of electric vehicles in a partnership with Tesla Motors. Toyota's chairman agrees with the president and provides that advances in environmental technology are the future for the automobile industry. Toyota has the opportunity to enhance its market position by emphasizing on hybrid electric vehicles whereby the company expands its product line up thus creating demand for the products (Company Spotlight, 2010).

Another opportunity provided by that company's President is expansion into new markets whereby the company aims to increase its market share. Toyota Annual Report (2009) provides that the company has emerging markets in China and other markets in Asia and also in central and South America. The Asian market is projected to drive automobile demand for much of the decade (Company Spotlight, 2010). The company aims to exploit this opportunity by introducing competitive models that meet customer needs in a timely manner.

Toyota has taken major strides to increase its presence in the Asian market where the company has 10 manufacturing companies in China (Company Spotlight, 2010). Toyota aims to increase production capacity in Asian countries thus increasing manufacturing and it also intends to its marketing operations in this markets.

Toyota's president provides another opportunity to the company and this is the fact that the automobile industry is on the road to recovery. TrueCar (2010) forecasted that Toyota's sales units would increase by 38.7% in April 2010 compared to same time in previous year. Company Spotlight provides that ...

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