TOYOTA STRATEGIES AND INITIATIVES

IN EUROPE

LAUNCH OF THE AYGO

TOYOTA GLOBAL:BECOMING
NO:1
In 2005,toyota sales hit the 2 million units
level for the 1st time and toyota held 13.7%
of the US market(up from 9.3% in 2000)
Between 1990 and 2005,the no. of toyota
factories increased from 20 factories in 14
countries to 47n factories in 26 countries.
Toyota was one of the 9 members of the
“$10 billion club”.(2005: net income $12.35
billion and revenue of $189 billion).
Toyota wants to increase its market share
of 11%(2005) to 15%(2010).
 TOYOTA &GM
GM MOTORS TOYOTA
Market cap – 2.2% Market cap – 35%
Sales – 13% Sales – 11%
 TOYOTA IN EUROPE
“WE ARE GROWING STEP BY STEP”
With the launch of the YARIS model in 1999
toyota sales took off.
The goal of achieving 8,00,000 units in
europe was reached 2 years ahead of time.
(in 2003 instead of 2005).
PRIUS- the hybrid car, helped toyota to
become the technology and also helped it to
position itself better. But only 18,000 units
were sold in europe.
LEXUS- only 25,000 units sold in europe
compared to 2,50,000 units in America
Among the automobile manufacturing
companies of asia toyota held highest
market share & sales in europe.
Inspite of all these success it stated “its
sales goal of 1.2 million units in europe by
2010.
 PSA
(Peugeot Société Anonyme)
France based company was almost not famous
among end users but the company brand
peugeot and citroen was famous.
PSA increased its european market share from
12% to 15.5%(1998-2003) and fell down by 14%
by 2005.
But still it was european 2nd biggest automobile
manafacturer in europe after VW.
PSA is known for its JV with fiat, ford, and BMW
TOYOTA & PSA AS JOINED
FORCES
TOYOTA PEUGEOT CTROEN
AUTOMOBILE (TPCA)
50:50 JV, kolin, czeh republic
3,00,000 units max capacity(2:1)
93% of parts were standardized among 3
type cars.(peugeot 107, citroen C1, aygo)
3000 employees
Toyota TPS used for running the factory
PSA manage all purchasing functions.
80% of parts were supplied by suppliers in
czeh republic and TPCA were directly
dealing with 150 tier 1 suppliers.
In additional to that european suppliers were
eager in supplying to TPCA as many of their
traditional customers has cut down their
production. So they can grow with toyota in
europe.
 RUNNING TPCA AND
OVERCOMING OBSTACLES
ABSENTEEISM: TPCA operate on shifts
and employees work 4 days/week and 10
hours/day. But they were pushed to work
continuously for 6 days which resulted in
much unscheduled leave. Management
soon changed the shifts and took
necessary calls.
TALENT MANAGEMENT: Hyundai started
hiring for its czeh factory.
BARRIERS: TPCA was dealing with 3
company cultures namely japanese,
french and czeh. 2 companies had
different production style and history. Also
need to overcome language barrier.
MEETING STRUCTURE: Inorder to minimize
miscommunication TPCA had systematic meeting
structure.
DAILY PRODUCTION MEETING: Eveyday 8:30a.m
managers discuss about quality, absenteeism and major
problems
PROJECT LEADERS MEETINGS: 10 to 20 managers
from PSA and 30 to 40 managers from toyota meet on
monthly basis.
STEERING COMMITTEE: TPCA’s highest
decision making committee. Critical
decisions are made. Consist of 5 members
from each company and meeting is carried
yearly twice either at toyota HQ in tokyo or
in PSA HQ in paris.
AYGO=I+GO
MARKETING CHALLENGES
OF AYGO
93% standardized parts and how to
differentiate from its 2 siblings was really a
problem
Just in 2005 toyota launched Yaris which
is bigger than AYGO and also $3000 more
so more commission was given.
Plant capacity is 300000 (2:1) which
should be determined only by demand.
The average age of toyoto customers is
50+ years in europe. This is the 1st time
they are targeting.
 UNDERSTANDING GEN Y
Indiviualistic
Internet savvy
Immune to traditional advertisements
Attribute
MARKETING STRATEGIES
FOR AYGO
Phase 1
Phase 2
Sponsoring rap concerts
Dealer training
Aygo nights
Aygo city tour
Mobile services
 CONCLUSION
Michael porter suggests that strategy
formulation requires an analysis of the
attractiveness of the industry and the
company’s position within the industry.
This analysis becomes the basis of
formulating generic strategies.
 GENERIC STRATEGIES
PORTER’S INDUSTRY ANALYSIS:
5 forces
Competition among companies
Threat of new companies entering the
market
Threat of substitutes
Bargaining power of suppliers
Bargaining power of buyers
 GENERIC STRATEGIES
Overall cost leadership strategy
Differentiation strategy
Focused strategy
Toyota 'world's largest
carmaker'
Japan's Toyota has overtaken US rival
General Motors to become the world's
biggest carmaker, a spokesman for the
company has said.
According to company figures, Toyota sold
2.348 million vehicles in the first three
months of 2007.
General Motors (GM) is estimated to have
sold 2.26 million cars and small trucks
during the same period.
THANK YOU
 TEAM MEMBERS

C.SURESH KUMAR
S.M.ARUN SENTHIL KUMAR
D.RAMAN