Analysing Growth Opportunities and Key Transformations in

Toyota's Marketing Landscape

Student number

Module name and code- Contemporary Marketing Practice

(BMDM5001)

Tutor name- Max Chikwanha

Submission date

Word count

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2|Page
Table of Contents
Task 2..........................................................................................................................................................4
1. Introduction:........................................................................................................................................4
2. Environmental analysis (Macro and Micro).........................................................................................4
2.1. PESTLE Analysis - Key Factors:.................................................................................................4
2.1.1. Environmental...........................................................................................................................4
2.1.2. Political:.....................................................................................................................................5
2.1.3. Technological Factors:...............................................................................................................6
2.2. Porter's Five Forces Analysis for Toyota (High-Ranked Factors):...............................................6
2.2.1. Bargaining Power of Suppliers (High):..................................................................................6
2.2.2 Rivalry Among Existing Competitors (High):...............................................................................7
2.3. Competitor Capability Analysis - Toyota vs. Competitor (e.g., Honda)......................................7
3. Situation analysis SWOT:..............................................................................................................10
3.1. Converting Weaknesses into Strengths:................................................................................10
3.2. Turning Threats into Opportunities:......................................................................................11
3.3. Proposed Growth Opportunities............................................................................................12
4. Conclusion.........................................................................................................................................12
References:................................................................................................................................................13
Appendix...................................................................................................................................................17
TASK 1 – Audit Research.........................................................................................................................17
Macro Environment (PESTLE Table).......................................................................................................17
External Micro Environment (Porter's Five Forces & Competitor Capability Analysis)...........................20
Porter’s Five Forces...............................................................................................................................20
Competitor Capability Analysis - Toyota vs. Honda (Example):...........................................................21
Internal Micro Environment (SWOT)....................................................................................................22

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Task 2

1. Introduction:
Founded by Kiichiro Toyoda on August 28, 1937, and based in Toyota City, Aichi, Japan, Toyota Motor
(Toyota, 2022) Corporation had a net revenue of JPY 31.9 trillion (about USD 280 billion) in fiscal year
2022 (Toyota, 2023). Toyota is well-known for its dedication to sustainability and innovation and has a
significant presence in the auto sector (Liker, 2021). This paper aims to comprehensively examine the
macro, micro, and internal aspects that affect Toyota's marketing environment. The PESTLE framework,
Porter's Five Forces analysis, competitor capability assessment, and SWOT analysis are all used in the
research to find critical insights about Toyota's strengths, weaknesses, opportunities, and threats. The
results will help comprehend Toyota's growth prospects and difficulties in the B2C market.

2. Environmental analysis (Macro and Micro)

Environmental analysis includes assessing the external factors, involving macro (e.g., economic, political,
social) and micro (e.g., industry-specific) elements, that may influence a company's operations and
strategies (Mc Lintock and Hofmann, 2020). The PESTLE, Porter's Five Forces, and Competitor
Capability analyses' most essential factors for Toyota and their effects on the business's performance are
examined and evaluated in detail in the appendix.

2.1. PESTLE Analysis - Key Factors:

2.1.1. Environmental

Impact: The automotive sector is significantly impacted by the worldwide concern for the environment
and climate change. Investments in electric and hybrid technologies are becoming necessary due to
governments enforcing higher pollution norms and regulations (Coetzee et al., 2016). With a target of a
68% reduction in emissions by 2035 compared to the base year of 2019, Toyota has set emissions
reduction targets for Scope 1 and 2 emissions. This aim aligns with attempts to keep global warming to
1.5 degrees Celsius, as indicated by its validation/approval class of "1.5°C." (Toyota, 2021).

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 Fig 1: Toyota CO2 emissions in different regions (Toyota, 2021)

Implications: The rising demand for environmentally friendly automobiles aligns with Toyota's long-
standing dedication to sustainability and its position as a hybrid and electric vehicle technology leader.
Toyota now has the chance to increase its market share of ecologically friendly consumers (Coetzee et al.,
2016).

2.1.2. Political:
Trade policies

Impact: modifications to international trade agreements and tariffs may affect Toyota's supply chain and
production costs, particularly given the company's vast worldwide manufacturing network. Implications:
To reduce the risks associated with trade uncertainties, Toyota must adjust to changing trade policies by
diversifying its supply chain and, where appropriate, contemplating local manufacture. Toyota

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emphasised that the amount contributed to raising a five-year investment pledge from $10 billion to
nearly $13 billion in the US in 2017 (Shirouzu, 2019).

2.1.3. Technological Factors:

Impact: The automobile sector is changing due to advancements in connected cars, autonomous driving
systems, and digital sales, all of which demand significant investments in research and development
(Nkomo, 2019).

Implications: Toyota's technological and innovative prowess is essential to tackling these revolutionary
changes. Staying on the cutting edge of technology is crucial to satisfy client expectations and remain
competitive. Toyota plans to introduce next-generation lithium-ion batteries with faster charging times
and longer ranges starting in 2026 (Financial Tribune, 2023).

Fig 2: Activity of Toyota Group on Batteries and Fuels (Know made, 2022)

2.2. Porter's Five Forces Analysis for Toyota (High-Ranked Factors):

2.2.1. Bargaining Power of Suppliers (High):
Impact: High bargaining power is possessed by a small group of suppliers of essential components, such
as semiconductors and speciality materials. The substantial impact is highlighted by recent disruptions in
the supply chain (Kito et al., 2019).

Implications: Toyota needs to keep strong ties with its suppliers, diversify its sources whenever feasible,
and have backup plans to ensure the stability of its supply chain.

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2.2.2 Rivalry Among Existing Competitors (High):
Impact: There are many national and international competitors (Mercedes Benz, BMW, Ford, Honda,
Nissan, Audi, Tesla, Volkswagen, Hyundai) in the fiercely competitive automobile sector (Bhasin, 2023).
Innovation, pricing competition, and product differentiation are some of the elements that fuel intense
rivalry (Miyazaki, 2017).

Fig 3: Toyota and Competitors (Alonso, 2023)

Implications: Toyota has applied lean manufacturing practices and new inventive technologies to gain a
competitive edge through cost leadership, differentiation, and focus. However, to satisfy the growing
demands of its clientele and hold onto its position as the industry leader, the business must continuously
assess and improve its competencies in these domains (Rahman and Acharaya, 2020).

2.3. Competitor Capability Analysis - Toyota vs. Competitor (e.g., Honda)

Elements Toyota Competitor (e.g., Honda)
Product Pioneer in hybrid/electric tech Strong focus on hybrid tech
Innovation
Revenue Toyota is the top automaker in the world, In 2021, Honda's revenue was 14.5
selling more than 10.5 million cars globally trillion yen, which was less than half
in 2021. of Toyota's revenue (start. io., 2022).
Market Share High global market share Strong presence with a slightly smaller

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 market share
Pricing Major World's research shows that Toyota Offers competitive pricing for their
easily outperforms Honda in terms of both products
vehicle choices and cost (Major World,
2023).
Production Efficient global manufacturing has a Honda's turbocharged units face
Efficiency reputation for reliability, which results in reliability complaints (Indy Auto Man,
higher resale value for their vehicles. 2018)
Brand Loyalty Strong brand loyalty Developing brand loyalty
Environmental Strong sustainability initiatives Increasing focus on sustainability
Efforts
Technological Innovations in connectivity and autonomous Focus on innovation but not as
Advancements tech advanced as Toyota

Fig: Comparison of Toyota's Automotive Revenue with Honda's Automotive Revenue (Trefis, 2019)

Implications for Toyota

Product Innovation: Toyota leads the market due to its innovative electric and hybrid technology work.
The upshot is that Toyota needs to keep funding R&D to be on the cutting edge of technology and grow
its line of electric vehicles (Matsuo, 2015).

Market Share: Toyota has a sizable worldwide market share, which helps it to benefit from economies
of scale. To improve cost efficiency, Toyota should use its market share to bargain favourably with
partners and suppliers (Palmer et al., 2018).

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 Fig 4: Toyota Motor US Market Share (Cox Automotive, 2023)

Production Efficiency: Toyota lowers production costs through its effective worldwide manufacturing
operations. Toyota can continue to offer high-quality products at competitive prices (Oetomo, 2017).

Fig 5: Toyota Worldwide production (Carlier, 2023)

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Brand Loyalty: A strong brand helps keep customers longer. To strengthen brand loyalty, Toyota should
keep improving customer pleasure and experience (Toma and Naruo, 2017).

Environmental Efforts: As consumer demand for eco-friendly products grows, Toyota responds with
robust sustainability measures. To satisfy growing consumer desires for environmentally friendly
automobiles, Toyota should continue to be committed to sustainability—possibly even stepping up its
initiatives.

Technological Developments: Future developments in automobile trends will largely depend on Toyota's
connectedness and autonomous technology advances. To meet changing customer expectations and
maintain its competitiveness, Toyota must be at the forefront of technical breakthroughs (Paladugu and
Grau, 2020).

3. Situation analysis SWOT:

3.1. Converting Weaknesses into Strengths:
North American Reliance into Global Diversification

Strategy: Toyota should broaden its geographical reach by venturing into developing nations. Lithium-
ion batteries for the EVs that Toyota plans to build in North America starting in 2025 will be supplied by
LG Energy Solution, a South Korean company (Fujimoto, 2018).

Benefits: It will lower risk and open up new clientele and expansion prospects.

Integrating Supply Chain Risks into Sturdy Supply Chain Management

Strategy: Use digital technology and various vendors to increase the supply chain's resilience. The Toyota
Production System, also called TPS, has received recognition for its ability to withstand supply chain
interruptions from events like the Great Tōhoku Earthquake and the COVID-19 pandemic. The TPS
guidelines guarantee that learning to perform tasks more effectively is closely linked to regular work
(Marszewska, 2016).

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 Fig 6: Supply Chain Toyota (Toyota 2015)

Benefits: Guarantees continuous output and reduces the effect of disturbances.

Brand Perceptions into Brand Modernization

Strategy: Bring the brand up to date to appeal to younger, tech-savvy customers. Toyota's infotainment
systems have finally been modernised (Goreham, 2022).

Benefits: Gains long-term brand relevance and diversifies the client base.

Pricing Pressure into Value Innovation

Strategy: Put quality, fuel economy, and cutting-edge technology at the forefront of value innovation (Liu
and Meng, 2017).

Benefits: Maintains brand value, draws in cost-conscious customers, and guarantees profitability.

Combustion Engine Dependency into Electric Transformation

Strategy: Accelerate the transition to hybrid and electric technology a strategy.

Benefits: Guarantees sustainability by adapting to market trends and customer preferences.

3.2. Turning Threats into Opportunities:

Transitioning from Regulation to Sustainability Leadership

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Strategy: Make proactive investments in environmentally friendly procedures and greener technologies
(Gabrelli, 2016).

Benefits: Promotes compliance, reputation, and access to government incentives.

Intense Competition into Collaborative Innovation

Strategy: Toyota must work with startups, IT firms, and industry participants (Safitri et al., 2023).

Benefits: Promotes innovation, produces fresh product lines, and keeps a company competitive.

3.3. Proposed Growth Opportunities

Growth in the Electric car Market:

Justification: Toyota's proficiency with electric and hybrid technologies is a significant advantage in the
quickly expanding electric car market. Toyota can increase its market share in environmentally friendly
vehicles by adding more electric vehicles to its lineup and investing in infrastructure for charging them
(Martin et al., 2021).

Developments in Autonomous Driving:

Justification: The automobile industry has identified autonomous driving technology as a significant
trend. Toyota should keep spending money on R&D to improve its capacity for autonomous driving.
Toyota can significantly impact this developing market and adapt to shifting consumer demands by
providing safe and dependable autonomous vehicles (Wang et al., 2018).

4. Conclusion
In conclusion, key insights are revealed by this thorough examination of Toyota's marketing environment,
which includes Porter's Five Forces, PESTLE, Competitor Capability, and SWOT analyses. To strengthen
its position, Toyota should broaden its market reach, add variety to its supply chain, update its image, and
prioritise value innovation. To turn challenges into opportunities, it should prioritise sustainability and
collaborative innovation. The electric vehicle market and autonomous driving technology developments
present growth opportunities, building on Toyota's advantages in these domains.

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Appendix

TASK 1 – Audit Research

Macro Environment (PESTLE Table)

External/Internal factor to consider Opportunity or Threat Ranking

Political -Toyota must make large financial investments in Opportunity: Toyota can High
electric and hybrid technologies in order to comply advance its electric and
with stricter pollution regulations. hybrid technologies,
-The worldwide production network of Toyota is lower costs, and become
susceptible to modifications in international trade more competitive in the
agreements and levies (Ferguson, 2023). green car market with the
-Demand for Toyota's environmentally friendly help of government
vehicles is fueled by government subsidies for research and
electric and hybrid vehicles. development subsidies
-Tight safety regulations, particularly those (Takeuchi et al., 2018).
pertaining to ADAS, have an impact on product
development and consumer preferences (Takeuchi et Threat: Stricter safety
al., 2008). laws, especially those
-Toyota may be able to obtain government financing pertaining to ADAS, can
for EV infrastructure development and research. necessitate large
expenditures in product
development and
production procedures,

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 which could increase
costs and reduce a
company's ability to
compete in the market
(Ferguson, 2023).
Economic -Toyota's sales may decline during economic Opportunity: As petrol Medium
downturns when consumers postpone making large prices rise, there may be
purchases like cars. a greater demand for
-Because Toyota imports and exports automobiles Toyota's fuel-efficient
and parts, fluctuating exchange rates have an impact hybrid vehicles, which
on its global operations (Ohno, 2019). might improve sales and
market share in the
-Variations in the price of oil affect consumer environmentally
choices, which may increase demand for hybrid and conscious auto industry
fuel-efficient vehicles. (Dillon, 2019).
-Toyota's production costs and product pricing may Threat: Consumer
be impacted by inflation (Dillon, 2019). spending on cars may
-Changes in interest rates impact consumer financing decline during economic
for automobile purchases, which impacts sales downturns, which might
numbers. affect Toyota's sales and
profitability, especially
for expensive models
(Ohno, 2019).
Social -Toyota's environmentally friendly electric and Opportunity: Toyota may Medium
hybrid vehicles are in higher demand as take advantage of
environmental consciousness grows. consumers' increased
-Toyota develops its products and develops its environmental
marketing strategy in response to consumer demand consciousness by adding
for technology, connectivity, and safety features more electric and hybrid
(Sisson and Elshennawy, 2015). vehicles to its inventory.
-The demand for tiny, urban-friendly hybrid cars is This will provide Toyota
being driven by urbanisation. a competitive advantage
-In many countries, an ageing population raises the in the market for
need for automobiles with cutting-edge accessibility environmentally friendly
and safety features (Iyoda et al., 2016). cars (Iyoda et al., 2016).
Threat: Changing
consumer tastes towards
safety features and
cutting-edge technology
may need ongoing R&D
expenditures, which
could raise
manufacturing prices and
put pressure on the

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 market (Sisson and
Elshennawy, 2015).
Technological -The expansion of e-commerce and online vehicle Opportunity: By Low
sales platforms will help Toyota improve its online embracing digitalization
presence. and e-commerce
-Keeping up with connected car and autonomous platforms, Toyota can
driving technologies requires funding research and improve its online sales
development (Barron et al., 2017). and increase its market
-Toyota's product lineup and sustainability initiatives share by contacting tech-
are impacted by hydrogen and electric fuel cell savvy customers and
technological advancements. increasing income
-To improve customer insights and product (Yumiya et al., 2015).
development, Toyota can leverage big data and
analytics (Yumiya et al., 2015). Threat: Toyota's
-The protection of consumer data and vehicle resources may be
integrity necessitates addressing cybersecurity strained and its product
concerns as automobiles become increasingly development and
networked. operations may become
more difficult due to the
necessity of making
significant expenditures
in cybersecurity and
connected vehicle
technologies (Barron et
al., 2017).
Legal -Adherence to regulatory requirements pertaining to Opportunity: Toyota can Low
emissions from automobiles and ecological improve its image for
benchmarks (Yoshida and Kojima, 2015). building safe, eco-
-Complying with rules and guidelines pertaining to friendly cars by adhering
advanced driver assistance systems (ADAS) and strictly to safety and
vehicle safety. emission laws. This will
-Intellectual Property Protection: This section draw in eco-aware
discusses the legal aspects of defending Toyota's customers and prioritise
technological and automotive breakthroughs and safety (Wang, 2017).
intellectual property rights (Yoshida and Kojima,
2015). Threat: To protect
-Adherence to employment laws encompassing Toyota's technological
labour agreements, rules governing the workplace, breakthroughs against
and labour entitlements. legal disputes and
challenges from rivals,
complex and ever-
evolving intellectual
property protection
regulations may

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 necessitate ongoing legal
resources and measures.
Ecological -Toyota is reducing emissions and developing Opportunity: Toyota may High
sustainable automobiles in response to climate draw in eco-aware
concerns. customers by showcasing
-Toyota must make investments in greener its dedication to
technologies and modify its product selection in sustainability and
order to comply with stricter emission regulations lowering carbon
(Madoh et al., 2019). emissions. This would
-Toyota is impacted by the rising demand for improve the company's
sustainable production practises and recyclable reputation and increase
materials. its market share in the
-Resources scarcity, such as rare earth metals, can eco-friendly vehicle
affect supply chain resilience and production costs. industry (Madoh et al.,
-The public's opinion of Toyota's sustainability 2019).
initiatives is shaped by environmental activists and
organisations (Lyod, 2016). Threat: Toyota's
competitiveness and
profitability may be
impacted by resource
scarcity, particularly with
regard to rare earth
metals, which could
cause supply chain
disruptions and higher
production costs (Lyod,
2016).

External Micro Environment (Porter's Five Forces & Competitor

Capability Analysis)
Porter’s Five Forces
Bargaining Power of Suppliers
Questions Description Ranking

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 1. What is the bargaining
power of suppliers in today's
environment (select one)?
What are your top 3 reasons for
the response you gave?
2.What will be the bargaining
power of suppliers be in 3-5
years (select one)? What are
your top 3 reasons for the
response you gave?
3. What moves are your
suppliers likely to make in the
next 3-5 years?
4. What moves do you need to
make in the next 3-5 years?
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Restricted Suppliers: As recent interruptions have
shown, Toyota, like the larger automobile industry,
depends on a small number of vital component
suppliers. The supplier's bargaining leverage is
strengthened by this dependence (Feugerson, 2023). High
Supplier Concentration: Toyota's cost structure and
profitability are impacted by the substantial terms
and pricing influence exerted by a limited group of
important suppliers.
Growth in Demand for Essential Components: As
Toyota's lineup of vehicles includes more electric
and hybrid vehicles, demand for particular parts has
grown, strengthening supplier negotiating leverage
(Toyota, 2015).
Technological Advancements: As the automotive
industry continues to migrate towards electric and
hybrid vehicles, specialised parts like cutting-edge
batteries and semiconductors will become more
important, strengthening suppliers' negotiating
position (Shirouzou, 2019). High
Supply Chain Complexity: The automotive business
will always have complex global supply networks,
which calls for strong supplier partnerships and
gives suppliers a lot of sway (Matsuo, 2015).
Environmental restrictions: Automakers such as
Toyota will be forced to invest in cleaner technology
by strict environmental restrictions and the drive for
sustainability, which will provide suppliers of eco-
friendly materials significant bargaining power. This
pattern will continue to affect Toyota's
manufacturing procedures (Nkomo, 2019).
Invest in Innovation
Diversify and Mitigate Risks
Embrace Sustainability
Enhance Supply Chain Efficiency
Explore Strategic Partnerships
Develop new connections with suppliers to lessen
your reliance on existing ones.
Invest in the internal production of essential
components, such as semiconductors, to bolster in-
house capabilities.

Bargaining power of Customers
Questions
1. What is the bargaining
power of customers in today's
environment (select one)?
What are your top 3 reasons for
the response you gave?
2.What will the bargaining
power of customers be in 3-5
years (select one)? What are
your top 3 reasons for the
response you gave?
3. What moves are your
customers likely to make in the
next 3-5 years?
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Agree on solid, protracted agreements with
important suppliers.
Work with suppliers to implement eco-friendly
procedures.
Description Ranking
Customer Price Setting Power: In the car industry,
knowledgeable customers have the ability to
compare prices and affect pricing decisions (Liker,
2021). Medium
Customer Perception of Differentiation: In a very
competitive market, Toyota must continue to provide
unique products.
Cost of Switching to Competitors: Customers are
discouraged from switching brands or vehicle types
by the high upfront costs and possible loss of resale
value.
Technical Development and Distinction: Toyota Medium
needs to continue innovating to maintain its
uniqueness in the face of customers who are well-
informed thanks to technological improvements.
Transition to Electric and Hybrid Vehicles: Toyota
benefits from a growing consumer demand for
environmentally friendly solutions (Nkomo, 2019).
Cost of Ownership and Switching: Two important
deterrents to brand or model switching are money
and customer loyalty.
Transition to Eco-Friendly Vehicles
Embrace Advanced Technology
Value Sustainability
Seek Cost-Effective Solutions
Explore Mobility Services

4. What moves do you need to
make in the next 3-5 years?
Questions
1. What is the threat of
substitution in today's
environment (select one)?
What are your top 3 reasons for
the response you gave?
2.What will the threat of
substitutes be in 3-5 years
(select one)? What are your top
3 reasons for the response you
gave?
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Demand Transparency
Expand Supplier network: To lessen reliance on a
small number of essential suppliers, Toyota should
think about expanding its supplier network.
Form Sturdy Long-Term Partnerships: You can
improve cooperation and obtain stable terms by
forming sturdy long-term partnerships with
important suppliers (Nkomo, 2019).
Invest in In-House Manufacturing: Investigating in-
house production capacity for essential components
can lessen susceptibility to interruptions in the
supply chain (Toyota, 2021).
Threat of Substitution
Description Ranking
Restricted Alternatives: While personal vehicles
offer convenience that is difficult to replace, they are
not a reliable option for long-distance or necessary
transit.
Models that are Hybrid and Electric: Toyota's Medium
significant presence in these car types lessens the
possibility of consumer substitution (Liker, 2021).
Absence of Mature Substitution Market: The pricing
and charging infrastructure issues that emerging
markets for electric and autonomous vehicles must
deal with lessen the likelihood of an instantaneous
substitute.
Developments in Electric Vehicles: Toyota's robust
EV business will present enticing substitutes for
conventional automobiles.
Growing Trends in Eco-Friendly Transportation:
Toyota's product line reflects consumers' shifting Medium
preferences for eco-friendliness (Martins et al.,
2021).
Developed Reputation and Customer Loyalty: The
threat of substitutes is lessened by Toyota's
 established reputation and the trust of its customers.
3. What substitute offerings Electric and Autonomous Vehicles
could impact your industry Ride-Sharing and Mobility Services
over the next 3-5 years Public Transportation and Active Mobility

4. What strategic moves do you Toyota can maintain its competitiveness by

need to make in the next 3-5
years to counter this threat?
providing cutting-edge substitutes for conventional
cars through investments in electric and autonomous
technologies.
Toyota can better accommodate evolving customer
preferences and offer more transportation options by
investigating mobility service partnerships.
Improving environmental activities and
sustainability will be in line with the increasing need
for eco-friendly solutions in the face of replacements
that are emerging (Martins et al., 2021).

Threat of New Entrants

Questions Description Ranking
1. What is the threat of New High Capital Requirements: The automobile industry
Entrants in today's has high entry barriers due to the need for significant
environment (select one)? capital inputs.
What are your top 3 reasons for Economies of Scale: Larger manufacturers can
the response you gave? reduce costs by virtue of their scale, which Medium
discourages new competitors (Liu and Meng, 2017).
Brand and Reputation: It is difficult for new entrants
to establish a strong brand and to earn trust because
these things need time and money.
2. What will the threat of New High Capital Requirements: New entrants in the
Entrants be in 3-5 years (select automotive business are discouraged by the high
one)? What are your top 3 initial capital inputs required.
reasons for the response you Established Competition: New entrants face
gave? competition from established automakers with
considerable brand recognition, such as Toyota.
Technological Advancements: Newcomers face Medium
obstacles due to ongoing research and development
investments in autonomous and electric technologies
(liker, 2021).
3. What strategic moves do Innovation and Technology Investment
you need to make in the next 3- Brand Strengthening

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 5 years to counter this threat? R&D Focus on Advanced Technologies

Competitive Rivalry
Questions Description Ranking
1. What is the level of Toyota is up against a lot of competition in the very High
competitive rivalry in today's competitive automotive industry.
environment (select one)? Product difference: Toyota's fierce competitiveness is
What are your top 3 reasons for mostly fueled by competition in innovation and
the response you gave? product difference (Liu and Meng, 2017).
Market rivalry: In the growing market for hybrid and
electric vehicles, Toyota faces intense rivalry.
2. What will be the level of Growth of the Electric and Hybrid Vehicle Market for High
competitive rivalry in 3-5 years Toyota: As the market for electric and hybrid vehicles
(select one)? What are your top continues to grow, Toyota should prepare for more
3 reasons for the response you intense competition.
gave? Technological Developments for Toyota: As the
automobile industry continues to improve
technologically, Toyota could expect more
competition.
Regulation and Sustainability Shifts for Toyota: As
sustainability and environmental rules gain
prominence in the automobile industry, Toyota needs
to get ready for increased competition.
3. What moves are your key The expansion of electric vehicle (EV) options is
competitors likely to make in anticipated from competitors in an effort to take share
the next 3-5 years? of the expanding market. This involves making
investments in EV technologies, enhancing the
charging network, and releasing new electric vehicles
(Trefis, 2021).
Competition will persist in emphasising the

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4. What strategic moves do
you need to make in the next 3-
5 years?
incorporation of cutting-edge technology into their
automobiles, such as greater connectivity, safety
systems, and autonomous driving capabilities.
Sustainability Initiatives: By using greener production
procedures, cutting emissions, and utilising more
environmentally friendly components in their cars,
rivals will probably place a strong emphasis on
sustainability (Wang, 2021).
Stress Electric and Hybrid Portfolio: Toyota should
keep adding more electric and hybrid cars to its
lineup, making use of its knowledge of
environmentally beneficial technology (Yamiya et al.,
2015).
Invest in Advanced Technology: To stay ahead of the
competition, give top priority to investments in
cutting-edge inventions, autonomous driving systems,
and linked automobile technology.
Boost Sustainability Initiatives: Make more of an
attempt to adhere to strict environmental standards
and to make vehicle design and manufacture more
sustainable (Madoh et al., 2019).

Competitor Capability Analysis - Toyota vs. Honda (Example):

Elements Toyota Honda
Products Ranges Diverse product range, including Offers a wide range of vehicles, including
sedans, SUVs, trucks, and hybrids. sedans, SUVs, and hybrids.
Profits or Market High global market share and Strong market presence and profits but a
Share profitability. slightly smaller market share than Toyota.
Pricing Strategy Competitive pricing with a focus on A similar focus is on competitive pricing and
affordability. affordability.
Distribution Extensive global distribution network. Strong distribution channels worldwide.
Channels
Social Media Active and engaged on social media Active on social media but with a somewhat
Presence platforms, with a large following. smaller following compared to Toyota.
Innovation and Pioneering in hybrid and electric Invests in advanced technologies and has a
Technology vehicle technology. presence in the electric vehicle market.
Marketing Tactics Effective marketing campaigns and Strong marketing efforts and brand presence.
strong brand presence.

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Internal Micro Environment (SWOT)
Here is a SWOT analysis for Toyota, informed by insights from the PESTLE analysis, Porter's Five
Forces, and competitor capability analysis:
Strengths
1. Global Presence: Toyota has a competitive
advantage due to its solid reputation and
widespread presence worldwide.
2. Innovation: Toyota pioneered electric and
hybrid car development.
3. Diverse Product Offering: Meeting consumer
preferences is achieved by providing a large
selection of vehicle models (Saftri et al., 2023).
4. Supply Chain Management: Resource flow is
guaranteed by Toyota's robust supply chain.
5. Sustainability: Toyota's dedication
sustainability aligns with the growing market for
environmentally friendly goods (Goreham, 2022).
Opportunities
1. Electric Vehicles: There is room to grow in the
expanding electric car sector.
2. Technological Developments: Toyota can use
its technological know-how to create linked and
driverless cars (Gabrelli, 2016).
3. Global Expansion: Entering emerging markets
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Weaknesses
1. North American Dependency: One weakness of
Toyota is its reliance on the North American
market.
2. Supply Chain Vulnerabilities: Toyota's supply
chain has vulnerabilities brought to light by recent
interruptions (Liu and Meng, 2017).
3. Brand Perceptions: Its conservative brand
image impacts Toyota's appeal in some markets.
4. Pricing Pressure: Price battles fought to remain
competitive may impact profitability.
to 5. Dependency on Combustion Engines: As the
industry moves towards electric mobility,
Toyota's reliance on conventional engines poses a
challenge.
Threats
1. Intense Competition: Both long-standing
competitors and recent entrants face fierce
industry competition.
2. Regulatory Changes: Costly adjustments may
be required as regulations change.
3. Supply Chain Disruptions: Production may be
 can help reach a wider audience. hampered by persistent vulnerabilities (Wang et
4. Sustainability Initiatives: Purchasing al., 2018).
environmentally friendly production techniques 4. Consumer Preferences: Adjustment is
aligns with current worldwide trends. necessary if priorities are shifted to include
5. Strategic Alliances: Increasing competitiveness electric and driverless vehicles.
can be achieved by collaborating with IT 5. Geopolitical Factors: International activities
companies or other automakers (Liu and Meng, may be impacted by trade conflicts and
2017). geopolitical concerns.

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