Toyota

Hyunsuk(Philip) Kim (UNC PID 720439991)

Executive Summary

I suggest that Toyota penetrate the hybrid powertrain segment fast but the launching timing should be balanced carefully till the end of 1998, considering the trade-off between unresolved issues about technology, production and first mover opportunity. Following 3 reasons- macro environment issues, growth opportunity through leveraging distinctive resources and first mover benefits - validate the entry of Toyota into the new segment.

Analysis

Macro environment issues

One of options to address below issues could be hybrid car for Toyota as it is fuel effiennt, environment friendly and also it can get the Toyota the competitive position in new segment compared to other players.

Category | Challenges |

Government regulations | Public concern about air pollution, fuel scarcityTechnology-forcing regulations such as ZEV initiating aggressive environmental regulations. |

Economy/Political risk | Increasing oil demand due to the expanding automobile productonVolatile oil price by the political risk in Middle east |

Intensive global competition | Industry becoming global by companies seeking growth chances across all major markets. |

Growth opportunity through leveraging distinctive resources.

Toyota is struggling with declining sales and profit due to the mature domestic market and also being criticized for its similar looking and old fashioned design. So, innovation to upgrade the company image and development of the new product should be considered for the sustainability of Toyota.

- “Kaizen” as Distinctive Resource

: Critical part of Toyota success derive from its production system. Thus, many competitors such as U.S manufacturers tried to imitate but failed because it’s secret is not physical system but commitment to learning which needs considerable investment for their knowledge and skills. These workforce make Toyota lower the cost continuously and get Prius affordable price range without...