SWOT Analysis of Toyota will elaborate the Strength & Weakness of, and the Opportunities & Threats for Toyota Motor.
Company Overview
Toyota Motor was founded by Kichiro Toyoda in the year of 1937 as a spinoff from his father’s company Toyota Industries to manufacture automobiles.
It is a Japanese automotive company, headquarter is in Toyota, Aichi, Japan. It’s a multinational automotive company, and by March 2014 it consisted more than 338,875 employees worldwide (Wikipedia). It is the first company that manufactured 10 million cars per year from 2012. In that year, Toyota announced it had manufactured its 200 millionth car.
SWOT Analysis of Toyota
Strength – In the first part of SWOT analysis of Toyota, Strength of Toyota is discussed.
“Internal Strategic Analysis”
- Strong Human Resource: for long term sustainable competitive advantages, a firm must invest in human resource. Toyota exactly did it. It has 338,875 skilled and experienced employees all over the world, as of March, 2014.
- Innovative: Toyota has innovative organizational culture. It facilitates rapid innovation.
- Strong Brand Image: Toyota is one of the oldest automotive brand. From the inception, it has been introducing different types of cars to its buyers which helped it to create a strong brand image.
- Strong Diversified Product Portfolio: Toyota has large number of products to offer which makes it sustainable in the current competitive market. It offers electric cars, full automotive diesel cars, hybrid cars etc.
- High Production Capability: The Company acquired high capability in producing cars, has been producing 10 million cars per year from 2012.
Weakness – In the second part of SWOT analysis of Toyota, Strength of Toyota is discussed.
“Internal Strategic Analysis”
- Dependence on Suppliers: Toyota Motor depends to a large extent on its suppliers. This creates a strong dependent relationship with it suppliers (Hino, (2012).
- Vehicle Recall: Toyota has recalled its cars for last few years. It is making Toyota financially weak which may
bring negative effect to future investment and the reputation as well. - Weak Presence in South Asia: Toyota does not offer hybrid, electric, or fuel efficient cars in South-Asia; as a
result it has no strong presence in South-Asia market.
Opportunities – In the third part of SWOT analysis of Toyota, Strength of Toyota is discussed.
“External Strategic Analysis”
- Growing Developing Nations: the demand of cars is increasing in developing nations.
- Growing concern for Environment pollution: people are becoming more concern for the environment; as a result there is a possible boom in sale of environment friendly cars.
- Rising demand of fuel efficient cars: the demand is always increasing for fuel efficient cars which is Toyota’s
latest offering.
Threats – In the fourth part of SWOT analysis of Toyota, Strength of Toyota is discussed.
“External Strategic Analysis”
- Number of Competitor: Number of competitor is not small in this industry. Toyota has large number of competitors including Fords, Mitsubishi, Volkswagen, and Honda.
- Growing Market of Low Cost Vehicles: Of course there is a huge market in South-Asian countries, and the demand for fuel efficient cars is high, but most of the buyers are interested in low cost cars.
- Carbon Emission Standards: If any government introduces new carbon emission standards, it may harm the market share.
- Rising Raw Material Costs: Rising raw material cost may increase the sale price.
- Yen Vs. Dollar: there is always a risk associated with exchange rate as it is a global company.
Recommendation Based on SWOT analysis of Toyota
As the strength discussed, Toyota Motor has great strength internationally. But to address the threats based on
competition, it must increase the competitive advantages by offering more environment friendly cars.
As the strength discussed, Toyota Motor has great strength internationally. But to address the threats based on
competition, it must increase the competitive advantages by offering more environment friendly cars.
Disclaimer:
This SWOT Analysis has been made using information freely available from difference online sources. It is created to use for educational purposes only.
[This SWOT analysis of Toyota conducted throughout the year 2015, and it will be updated time to time.]
References:
- Toyota-Global
- Toyota Wiki
- Toyota Body
- “INSIDE THE MIND OF TOYOTA: MANAGEMENT PRINCIPLES FOR ENDURING GROWTH” by Satoshi Hino
- gotabout.info
