Toyota-Strategy-for-Chinese-Market

ToyotaStrategyforChineseMarketCM130227BongsooKangCM130242NoboruNishiharaCM140204KensyoUchidaCM140234FanXiaoyuContents2ⅠIntroⅡIndustryAnalysisⅢStrategyReviewⅣConclusionProfile3CompanyNameToyotaMotorCorporationPresidentandRepresentativeDirectorAkioToyodaHeadOffice1Toyota-Cho,ToyotaCity,AichiPrefecture471-8571,JapanDatefoundedAugust28,1937Capital397.05billionyen(asofMay2014)MainBusinessActivitiesMotorVehicleProductionandSalesNumberofemployees(consolidated)338,875(asofMarch31,2014)-10%0%10%20%30%40%50%050,000100,000150,000200,000250,000300,00020002001200220032004200520062007200820092010201120122013TotalSalesROS(OP)(USDmillion)IncreasingRevenueStably&RecoveringProfitabilityImportanceofChinaStrategyforToyota4□ChinabecamethemostattractivemarketintheautomotiveindustryMarketSize(Unit):China17.3mnUS15.4mnJapan5.0mn(cf.Europe17.8mn)Penetration:US919W.Europe613Japan545China64Overallmarketattractiveness:China&USarehigh,butEurope&JapanarelowAttractivenessofMarketGlobalValueComparison5(USDbillion)RankCompanyRevenueProfitAssetMarketValue1Volkswagen254.028.6408.294.42Toyota224.53.4371.3167.23Daimler150.88.0211.964.14Ford134.35.7190.651.85BMW98.86.6165.560.06GM152.36.2149.438.57Nissan113.74.1133.443.48Honda96.02.6140.972.49Hyundai-Kia75.07.6114.341.510SAIC74.93.348.126.7*Source:Forbes(1,000unit)*source:BestSellingCar2,3951,03885784380772971467854605001,0001,5002,0002,5003,000VolkswagenHyundaiToyotaNissanBuick(GM)HondaChevrolet(GM)FordKia2013AutomobileCompanyRank2013GlobalbrandsalesinchinaＸ４□ToyotahaslowpositioninChinacomparingVWToyotahascompetedagainstVWonevenpositionintheworld-ToyotawasrankedN0.2ofAutomotiveBrandbyForbesin2013However,ToyotaisonastickywicketinChinesemarket-Toyotaonlysold857kunitsbutTWsold2,395k(aboutquadruple)in2013Therefore,itisveryimportantforToyotatoset-upthestrategyofChinesemarketContents6ⅠIntroⅡIndustryAnalysisⅢStrategyReviewⅣConclusionNewentrantsNewentrantsNewentrantssubstitutesRent-a-car・leaseCarsharing、autobiketrainUsedcardealercomplementCaraccessoryshopinsuranceoilNextgenerationstandairplaneMotorvehicleStandard-sizedautomobileVOLKSWAGENAGTOYOTADAIMLERAGGeneralMotorsCoFordMotorCoHONDAHYUNDAITransporterDAIMLERAG、VOLKSWAGENAG、HYUNDAIMOTOR、TATAMOTORS、ISUZU、HINO、MITUBISHIHUSOLightvehicleDAIHATSU、SUZUKI、HONDA、NISSANCorporationIndividualSuppliersMotorVehicleBuyersBuyersofbuyersordinaryLargeincomeearnerLowincomeearnerTransportindustrySportscarTVR、Ferrari、Maserati、LamborghiniTradingcompanyDealerPTASTRAINTERNATIONALTBKSIMEDARBYBERHADJARDINECYCLE&CARRIAGELTDAYALACORPORATIONHotaiMotorCo.,Ltd.BRILLIANCECHINAAUTOMOTIVEHOLDINGSLIMITEDAutoNationIncINCHCAPEPLCPenskeAutomotiveGroupIncIMPERIALHOLDINGSLIMITEDＡＴGroupＶＴHoldingsSuppliersofsuppliersNewentrantsPartsofcars（Tier1）assemblingtireElectricalcomponentrubbersuspensionExhaustportengineSeatbeltMetalworkingmicrocomputerPartsofcars（Tier2）assemblingtireElectricalcomponentrubbersuspensionExhaustportengineSeatbeltmetalworkingmicrocomputerMotorVehicleIndustry5ForcesinDetails8ForcesPowerReason１RivalryStrongAlotofplayers,lowgrowthrate,greatfixedassets,andlittleswitchingcost,etc.２SupplierWeakHighconcentrationrateamongsuppliers,standardization,lowshareofanyonepart,etc.３BuyerWeakStrongpowerofmakersbyhighconcentration,lowmarginfordealers,qualitydeterminedbymakers,notaffectedbydealers,etc.４NewEntryWeakEconomiesofscaleworkswell,greatini$tialinvestmentneeded,hardtoretrieve,etc.５SubstitutenormalNodestructiveinnovation,lowprofitmarginofsubstitutes,butincreasingcost-performance,etc.5forcesanalysis9IndustryCompetitorsIntensityofrivalryHIGHSuppliersNewentrantsBuyersSubstitutesThreatofnewentrantsLOWBargainingpowerofbuyersLOWThreatofsubstitutesNORMALBargainingpowerofsuppliersLOWAccordingto5forcesanalysis,profitpotentialofmotorvehicleindustryisbasicallyhigh.PESTanalysisinChina10①PoliticalFactors②EconomicFactors③Social-Culturalfactors④TechnologicalFactors・ChineseCommunistParty(One-partydictatorship)・WorseningofsentimentstowardsJapaninChina,dangerofextremedemonstration・CollaborationbetweencompanieswithCommunistParty(usingbribery)・Strictregulationsofautomobileindustry・Strengtheningofemissionregulationsfordieselvehicles・Proposedregulationsinimprovingfuelefficiency・Automobilepurchaselimitpolicyinordertoalleviatetrafficcongestionproblems(Shanghai&Beijing)Beijingwinningprobabilityof2%・Exemptionofvehicle-numberplatelotteryPurchaseincentivesinBeijing・Economicgrowthrecession・Highgrowthinautomobileindustry・Amplificationofwagegap・Employmentinsecurityamongyoungsters・Increaseinlaborcosts・Netexchangeratespolicy・Concernofpropertybubbleburst・Environmentalproblems・Withdrawalofforeign-investedcompanies(factories)・SlowdevelopmentofChineselocalcompanies・One-childpolicy・Accelerationofagingpopulationwithfallingbirthrate・Demographicshiftcausedbymigrationfromruraltourbanareas・Inadequatewelfareandpensionsystem・Buyingbehaviorvariesaccordingtoagegroups(Beforeandafter1980s)・Conspicuousconsumptionduetocultureofbeingappearance-conscious(notsosignificantrecently)・Publicamenitiesarestillnotsoreadilyavailable