PROJECT REPORT ON TOYOTA KIRLOSKAR MOTOR LIMITED

For the partial fulfilment of 3 year full time course BACHELOR OF BUSINESS ADMINISTRATION 2010-2011

Submitted to--DAV COLLEGE,CHANDIGARH

Submitted by--PANCHAM GAUR ROLL NO.6747 PUPIN NO.-17508000768

PREFACE

As a part of course curriculum of Bachelor of business administration we were asked to prepare a project report on a company and its marketing strategies.

I have put my sincere efforts to accomplish my objectives within the stipulated time. Despite all limitations, obstructs, hurdles and hindrances, I have toiled and worked to my optimum potential to achieve desired goals. Being neophytes in the highly competitive world of business. I came across some difficulties to make my objective a reality. Anyhow with the kind of help and genuine interest and the guidance of my supervisor. I am presenting this hand carved effort. I tried my level best to conduct a research to gain a thorough knowledge about the project on topic, Study of marketing strategies of Toyota. I put the best of my efforts and have also tried to be justice with available. If anywhere something is found unacceptable or unnecessary to the theme; you are welcomed with your valuable suggestions. Thanks and regards Yours sincerely Pancham Gaur

ACKNOWLEDGEMENT

I would like to thank Toyota Motors Corporation, for constant guidance to conduct the present arduous project and untiring cooperation which they extended to me throughout the duration of my summer training. Getting a project ready requires the work and effort of many people. I would like all those who have contributed in completing this project. First of all, I would like to send my sincere thanks to MR. MANISH GARG for his helpful hand in the completion of my project. I would like to take an opportunity to thank all the people especially my TEACHERS AND PARENTS who helped me in collecting necessary information and making of the report. I am grateful to all of them for their time, energy and wisdom.

(PANCHAM GAUR)

CONTENTS
Chapter 1 Conceptual Discussion (Theoretical Backdrop & Literature Review) 5

Chapter 2 Introduction 13 1.1. Overview of Industry as a whole 1.2. Profile of the Organization 1.3. Growth of the Organization 1.4. S.W.O.T Analysis of the Organization 1.5. Competition Information Chapter 3 - Objective & Methodology 51 2.1. Significance 2.2. Managerial usefulness of the study 2.3. Objectives 2.4. Scope of the study 2.5. Methodology Chapter 4 - Data Analysis Chapter 5 - Findings and Recommendations ANNEXURES: Include the following details in this section BIBLIOGRAPHY 73 57 68 70

CHAPTER 1 CONCEPTUAL DISCUSSION MARKETING

What is marketing? There are many different definitions of marketing. Consider some of the following alternative definitions: The all-embracing function that links the business with customer needs and wants in order to get the right product to the right place at the right time The achievement of corporate goals through meeting and exceeding customer needs better than the competition The management process that identifies, anticipates and supplies customer requirements efficiently and profitably Marketing may be defined as a set of human activities directed at facilitating and consummating exchanges Which definition is right? In short, they all are. They all try to embody the essence of marketing: Marketing is about meeting the needs and wants of customers; Marketing is a business-wide function it is not something that operates alone from other business activities; Marketing is about understanding customers and finding ways to provide products or services which customers demand To help put things into context, you may find it helpful to often refer to the following diagram which summarises the key elements of marketing and their relationships:

Figure 1.2

MARKETING CONCEPT AND ORIENTATION

It is a fundamental idea of marketing that organisations survive and prosper through meeting the needs and wants of customers. This important perspective is commonly known as the marketing concept. The marketing concept is about matching a company's capabilities with customer wants. This matching process takes place in what is called the marketing environment. Businesses do not undertake marketing activities alone. They face threats from competitors, and changes in the political, economic, social and technological environment. All these factors have to be taken into account as a business tries to match its capabilities with the needs and wants of its target customers. An organisation that adopts the marketing concept accepts the needs of potential customers as the basis for its operations. Success is dependent on satisfying customer needs. What are customer needs and wants? A need is a basic requirement that an individual wishes to satisfy. People have basic needs for food, shelter, affection, esteem and self-development. Many of these needs are created from human biology and the nature of social relationships. Customer needs are, therefore, very broad. Whilst customer needs are broad, customer wants are usually quite narrow. A want is a desire for a specific product or service to satisfy the underlying need. Consider this example: Consumers need to eat when they are hungry. What they want to eat and in what kind of environment will vary enormously. For some, eating at McDonalds satisfies the need to meet hunger. For others a microwaved ready-meal meets the

need. Some consumers are never satisfied unless their food comes served with a bottle of fine Chardonnay. Consumer wants are shaped by social and cultural forces, the media and marketing activities of businesses. This leads onto another important concept - that of customer demand: Consumer demand is a want for a specific product supported by an ability and willingness to pay for it. For example, many consumers around the globe want a Mercedes. But relatively few are able and willing to buy one. Businesses therefore have not only to make products that consumers want, but they also have to make them affordable to a sufficient number to create profitable demand. Businesses do not create customer needs or the social status in which customer needs are influenced. It is not McDonalds that makes people hungry. However, businesses do try to influence demand by designing products and services that are

Attractive Work well Are affordable Are available

Businesses also try to communicate the relevant features of their products through advertising and other marketing promotion.

MARKETING MIX
The marketing mix is generally accepted as the use and specification of the four Ps describing the strategic position of a product in the marketplace. One version of the origins of the marketing mix starts in 1948 when James Culliton said that a marketing decision should be a result of something similar to a recipe. This version continued in 1953 when Neil Borden, in his American Marketing Association presidential address, took the recipe idea one step further and coined the term 'Marketing-Mix'. A prominent marketer, E. Jerome McCarthy, proposed a 4 P classification in 1960, which would see wide popularity. The four Ps concept is explained in most marketing textbooks and classes.

DEFINITION
Although some marketers[who?] have added other Ps, such as personnel and packaging, the fundamentals of marketing typically identifies the four Ps of the marketing mix as referring to: Product -An object or a service that is mass produced or manufactured on a large scale with a specific volume of units. A typical example of a mass produced service is the hotel industry. A less obvious but ubiquitous mass produced service is a computer operating system. Typical examples of a mass produced objects are the motor car and the disposable razor. Price The price is the amount a customer pays for the product. It is determined by a number of factors including market share, competition, material costs, product identity and the customer's perceived value of the product. The business may increase or decrease the price of product if other stores have the same product. Place Place represents the location where a product can be purchased. It is often referred to as the distribution channel. It can include any physical store as well as virtual stores on the Internet. Promotion Promotion represents all of the communications that a marketer may use in the marketplace. Promotion has four distinct elements - advertising, public relations, word of

mouth and point of sale. A certain amount of crossover occurs when promotion uses the four principal elements together, which is common in film promotion. Advertising covers any communication that is paid for, from television and cinema commercials, radio and Internet adverts through print media and billboards. One of the most notable means of promotion today is the Promotional Product, as in useful items distributed to targeted audiences with no obligation attached. This category has grown each year for the past decade while most other forms have suffered. It is the only form of advertising that targets all five senses and has the recipient thanking the giver. Public relations are where the communication is not directly paid for and includes press releases, sponsorship deals, exhibitions, conferences, seminars or trade fairs and events. Word of mouth is any apparently informal communication about the product by ordinary individuals, satisfied customers or people specifically engaged to create word of mouth momentum. Sales staff often plays an important role in word of mouth and Public Relations (see Product above). Broadly defined, optimizing the marketing mix is the primary responsibility of marketing. By offering the product with the right combination of the four Ps marketers can improve their results and marketing effectiveness. Making small changes in the marketing mix is typically considered to be a tactical change. Making large changes in any of the four Ps can be considered strategic. For example, a large change in the price, say from $19.00 to $39.00 would be considered a strategic change in the position of the product. However a change of $131 to $130.99 would be considered a tactical change, potentially related to a promotional offer.

CRITICISMS
Peter Doyle claims that the marketing mix approach leads to unprofitable decisions because it is not grounded in financial objectives such as increasing shareholder value. According to Doyle it has never been clear what criteria to use in determining an optimum marketing mix. Objectives such as providing solutions for customers at low cost have not generated adequate profit margins. Doyle claims that developing marketing based objectives while ignoring profitability has resulted in the dot-com crash and the Japanese economic collapse. He also claims that pursuing a ROI approach while ignoring marketing objectives is just as problematic. He argues that a net present value approach maximizing shareholder value provides a "rational framework" for managing the marketing mix. Some people claim the four Ps are too strongly oriented towards consumer markets and do not offer an appropriate model for industrial product marketing. Others claim it has too strong of a product market perspective and is not appropriate for the marketing of services. An expanded system based on Seven Ps stresses the importance of Place, Product, Price, Promotion, People, Process, and Physical evidence

MARKET RESEARCH
Market research is for discovering what people want, need, or believe. It can also involve discovering how they act. Once that research is complete it can be used to determine how to market your specific product. MR-Anywhere is a very good platform for market research and analysis For starting up a business there are a few things that are important: Market information Market information is making known the prices of the different commodities in the market, the supply and the demand. Information about the markets can be obtained in several different varieties and formats. Examples of market information questions are: Who are the customers? Where are they located and how can they be contacted?

What quantity and quality do they want? When is the best time to sell? Market segmentation Market segmentation is the division of the market or population into subgroups with similar motivations. Widely used bases for segmenting include geographic differences, personality differences, demographic differences, use of product differences, and psychographic differences. Market trends The upward or downward movements of a market, during a period of time. The market size is more difficult to estimate if you are starting with something completely new. In this case, you will have to derive the figures from the number of potential customers or customer segments. [Ilar 1998] But besides information about the target market you also need information about your competitor, your customers, products etc. A few techniques are: Customer analysis Choice Modelling Competitor analysis Risk analysis Product research Advertising research

CHAPTER 2 - INTRODUCTION

2.1. OVERVIEW - INDIAN AUTOMOBILE INDUSTRY

Over a period of more than two decades the Indian Automobile industry has been driving its own growth through phases. The entry of Suzuki Corporation in Indian passenger car manufacturing is often pointed as the first sign of India turning to a market economy. Since then the automobile sector witnessed rapid growth year after year. By late-90's the industry reached self reliance in engine and component manufacturing from the status of large scale importer. With comparatively higher rate of economic growth rate index against that of great global powers, India has become a hub of domestic and exports business. The automobile sector has been contributing its share to the shining economic performance of India in the recent years. With the Indian middle class earning higher per capita income, more people are ready to own private vehicles including cars and two-wheelers. Product movements and manned services have boosted in the sales of medium and sized commercial vehicles for passenger and goods transport. Side by side with fresh vehicle sales growth, the automotive components sector has witnessed big growth. The domestic auto components consumption has crossed rupees 9000 crores and an export of one half size of this figure Overview Of Automobile Industry The Indian automobile industry is going through a technological change where each firm is engaged in changing its processes and technologies to sustain the competitive advantage and provide customers with the optimized products and services. Starting from the two wheelers, trucks, and tractors to the multi utility vehicles, commercial vehicles and the luxury vehicles, the Indian automobile industry has achieved tremendous amount of success in the recent years.

As per Society of Indian Automobile Manufacturers (SIAM) the market share of each segment of the industry is as follows:.

The market shares of the segments of the automobile industry

The automobile industry had a growth of 15.4 % during April-January 2007, with the average annual growth of 10-15% over the last decade or so. With the incremental investment of $3540 billion, the growth is expected to double in the next 10 years. Consistent growth and dedication have made the Indian automobile industry the second- largest tractor and two-wheeler manufacturer in the world. It is also the fifth-largest commercial vehicle manufacturer in the world. The Indian automobile market is among the largest in Asia.

The key players like Hindustan Motors, Maruti Udyog, Fiat India Private Ltd, Tata Motors, Bajaj Motors, Hero Motors, Ashok Leyland, Mahindra & Mahindra have been dominating the vehicle industry. A few of the foreign players like Toyota Kirloskar Motor Ltd., Skoda India Private Ltd., Honda Siel Cars India Ltd. have also entered the market and have catered to the customers needs to a large extent.

Not only the Indian companies but also the international car manufacturing companies are focusing on compact cars to be delivered in the Indian market at a much smaller price. Moreover, the automobile companies are coming up with financial schemes such as easy EMI repayment systems to boost sales. There have been exhibitions like Auto-expo at Pragati Maidan, New Delhi to share the technological advancements. Besides, there are many new projects coming up in the automobile industry leading to the growth of the sector. The Government of India has liberalized the foreign exchange and equity regulations and has also reduced the tariff on imports, contributing significantly to the growth of the sector. Having firmly established its presence in the domestic markets, the Indian automobile sector is now penetrating the international arena. Vehicle exports from India are at their highest levels. The leaders of the Indian automobile sector, such as Tata Motors, Maruti and Mahindra and Mahindra are leading the exports to Europe, Middle East and African and Asian markets. The Ministry of Heavy Industries has released the Automotive Plan 2006-2016, with the motive of making India the most popular manufacturing hub for automobiles and its components in Asia. The plan focuses on the removal of all the bottlenecks that are inhibiting its growth in the domestic as well as international arena.

Top Ten Players in Indian Automobile Sector

The domestic players as well as the foreign players dominate the Indian automobile sector. The key players contributing to the growth of the sector are discussed below.

Top Ten Players in Indian Automobile Sector

Maruti Suzuki India Hero Motors Limited Tata Group Bajaj Auto Limited Mahindra Group Ashok Leyland Yamaha Motor India Hyundai Motors India Limited Toyota Kirloskar Motor Private Limited Honda Siel Cars India Limited

1.2. COMPANY PROFILE

The story of Toyota Motor Corporation began in September 1933 when Toyota Automatic Loom created a new division devoted to the production of automobiles under the direction of the founder's son, Kiichiro Toyota. Soon thereafter, the division produced its first Type A Engine in 1934, which was used in the first Model A1 passenger car in May 1935 and the G1 truck in August 1935. Production of the Model AA passenger car started in 1936. Although the Toyota Group is most well known today for its cars, it is still in the textile business and still makes automatic looms (fully computerized, of course), and electric sewing machines which are available worldwide. Toyota Motor Co. was established as an independent company in 1937. Although the founding family name is Toyoda, the company name was changed to:

Signify the separation of the founders' work life from home life; Simplify the pronunciation, and Give the company an auspicious beginning. Toyota is considered luckier than Toyoda in Japan, where eight is regarded as a lucky number, and eight is the number of strokes it takes to write Toyota in Katakana.

During the Pacific War the company was dedicated to truck production for the Imperial Army. Because of severe shortages in Japan, military trucks were kept as simple as possible. For example, the trucks had only one headlight on the center of the hood.

Commercial passenger car production started in 1947 with the model SA. In 1950 a separate sales company Toyota Motor Sales Co. was established (which lasted until July 1982). In April 1956 the Toyota dealer chain was established.

Replica of the Toyota Model AA, the first production model of Toyota in 1936

HEADQUARTERS: TOYOTA CITY, JAPAN

ASSEMBLY PLANTS OVER THE WORLD

Toyota has factories all over the world, manufacturing or assembling vehicles for local markets, including its most popular model, the Corolla. Toyota has manufacturing or assembly plants in the United States, Australia, Canada, Indonesia, Poland, South Africa, Turkey, the United Kingdom, France, Brazil, and more recently India, Argentina and Czech Republic. Toyota also builds and sells cars in China in a joint venture with Tianjin Xiali. Toyota New Zealand assembled vehicles until 1998, when it switched to importing cars from Japan and Australia. Cars from these plants are often exported to other countries.

Toyota Car Model:

Innova

Camry

Avalon

Matrix

Corolla

Prius

TRUCKS:

Tacoma

Tundra

SPORTS UTILITY VEHICLES( SUVs):

4runner

Land cruiser

OVERVIEW
In 2006, Toyota was engaged in a variety of projects designed to solidify its foundations while continuing to grow.

On the product front, Lexus launched its new flagship model, the LS, and the new global Camry went on sale. In Japan, a new Corolla range was introduced, emphasizing the importance of this best-selling car.

In manufacturing, several new projects were started around the world. In May, manufacture of the Camry began in Guangzhou, China, while in the United States, the Kentucky plant, which in October celebrated 20 years of production, started manufacturing the first Toyota hybrid vehicle to be made in North America, the Camry Hybrid. In November, the Texas plant began producing the new Tundra truck, a key vehicle in Toyotas North American lineup. In Japan, Toyota Motor Kyushu, Inc. began full-scale operations at its engine factory, while Toyota Motor Tohoku Co., Ltd. increased its manufacturing capacity.

In human resources development, following the establishment of the Asia Pacific Global Production Center in Thailand in August 2005, Toyota established the North American Production Center in the U.S. in February, and the European Global Production Center in the United Kingdom in March. Established as branches of the Global Production Center in Japan, these were created to spread Toyotas manufacturing knowledge and skills throughout the world in pace with the rapid growth of Toyotas overseas manufacturing. The centers educate trainers for local manufacturing plants in all regions, with trainees passing on what they learn to team members on their return to their plants.

In R&D, Toyota focused its efforts on three key areas: environment, safety and energy. It made a special effort in the area of the environment by expanding its lineup of hybrid vehicles, and has worked on R&D relating to plug-in hybrid. In addition, as part of Toyotas efforts to respond to the diversification of energy, in 2007 Toyota introduced a flex fuel vehicle* in the Brazilian market that will run on 100% bio-ethanol fuel. From this point on, based on the philosophy of providing the right car, in the right place, at the right time, and in accordance with the infrastructure and customer needs of each region, Toyota will continue to promote efforts to develop environmentally friendly technology and vehicles.

CORPORATE DATA

Company Name

Toyota Motor Corporation August 28, 1937

Established

Tokyo Head Office 1-4-18 Koraku, Bunkyo-ku, Tokyo 112-8701, Japan Phone: (03)3817-7111 Nagoya Office 4-7-1 Meieki, Nakamura-ku, Nagoya City, Aichi Prefecture 4508711, Japan Phone: (052)552-2111

Head Office

Toyota-Cho, Toyota City , Aichi Prefecture 471-8571 , Japan Phone : (03)3817-7111

Since its foundation, Toyota has conducted business with contributing to the development of a prosperous society through the manufacture of automobiles as a guiding principle. When I became president two years ago, I called on all employees to work with me in returning to our origins and asking earnestly whether Toyota is truly contributing to society and whether we are doing everything we should be doing. On the occasion of Toyotas 70th anniversary, we will reinforce our measures designed to return to our core principle, which is to "repay the earth and society through technological innovation (and contribute to enhancing the quality of life everywhere.

GUIDING PRINCIPLES

 Honor the language and spirit of the law of every nation and undertake open and fair corporate activities to be a
good corporate citizen of the world. Respect the culture and customs of every nation and contribute to economic and social development through corporate activities in the communities. Dedicate ourselves to providing clean and safe products and to enhancing the quality of life everywhere through all our activities. Create and develop advanced technologies and provide outstanding products and services that fulfill the needs of customers worldwide. Foster a corporate culture that enhances individual creativity and teamwork value, while honoring mutual trust and respect between labor and management. Pursue growth in harmony with the global community through innovative management. Work with business partners in research and creation to achieve stable, long-term growth and mutual benefits, while keeping ourselves open to new partnerships.

PERCEPTS
Be contributive to the development and welfare of the country by working together, regardless
of position, in faithfully fulfilling your duties.

Be at the vanguard of the times through endless creativity, inquisitiveness and pursuit of
improvement.

Be practical and avoid frivolity. Be kind and generous; strive to create a warm, homelike atmosphere.
Be reverent, and show gratitude for things great and small in thought and deed

MANAGERIAL INFORMATION

1. Executives 1) Board of Directors (26 people) Name Fujio Cho* Katsuhiro Nakagawa Katsuaki Watanabe Tokuichi Uranishi Title Chairman Vice Chairman President Executive Vice President

Kazuo Okamoto Kyoji Sasazu Mitsuo Kinoshita Yoshimi Inaba Takeshi Uchiyamada Masatami Takimoto Akio Toyoda Tetsuo Hattori Yukitoshi Funo Takeshi Suzuki Atsushi Niimi Hajime Wakayama Hiroshi Takada Teiji Tachibana Shinichi Sasaki Shin Kanada Akira Okabe Yoshio Shirai Yoichiro Ichimaru Shoji Ikawa Shoichiro Toyoda Hiroshi Okuda**

Executive Vice President Executive Vice President Executive Vice President Executive Vice President Executive Vice President Executive Vice President Executive Vice President Senior Managing Director Senior Managing Director Senior Managing Director Senior Managing Director Senior Managing Director Senior Managing Director Senior Managing Director Senior Managing Director Senior Managing Director Senior Managing Director Senior Managing Director Senior Managing Director Senior Managing Director Honorary Chairman Senior Advisor, Member of the Board

*Promoted, **Changed

2) Corporate Auditors (7 people) Name Hideaki Miyahara Chiaki Yamaguchi Masaki Nakatsugawa* Yasutaka Okamura Yoichi Kaya Yoichi Morishita* Akishige Okada* *Newly appointed Title Corporate Auditor Corporate Auditor Corporate Auditor Corporate Auditor (external) Corporate Auditor (external) Corporate Auditor (external) Corporate Auditor (external)

3) Managing Officers (49 people) Name Koichi Ina Yoshikazu Amano Takeshi Yoshida Shinzo Kobuki Akira Sasaki Hiroshi Kawakami Iwao Nihashi Tadashi Arashima Masamoto Maekawa Title Managing Officer Managing Officer Managing Officer Managing Officer Managing Officer Managing Officer Managing Officer Managing Officer Managing Officer

Mamoru Furuhashi Satoshi Ozawa Seiichi Sudo Yasuhiko Ichihashi Tadashi Yamashina Takashi Hata James E. Press Gary L. Convis Wahei Hirai Tatehito Ueda Takashi Shigematsu Yuzo Ushiyama Yasumori Ihara Takahiko Ijichi Toshio Furutani Tetsuo Agata Senta Morioka Hironobu Inoue Kazuhiko Takarada Masayuki Nakai Toshiki Hayama Takahiro Iwase Akihito Tsuji

Managing Officer Managing Officer Managing Officer Managing Officer Managing Officer Managing Officer Managing Officer Managing Officer Managing Officer Managing Officer Managing Officer Managing Officer Managing Officer Managing Officer Managing Officer Managing Officer Managing Officer Managing Officer Managing Officer Managing Officer Managing Officer Managing Officer Managing Officer

Yoshihiko Masuda Nobuo Kobayashi Yoshimasa Ishii Tatsuya Kaneko Takeshi Shirane Masanao Tomozoe Katsunori Itasaka Tokuyuki Takahashi Real (Ray) Tanguay Ryoichi Sasaki* Seiho Kawakami* Yasuhiro Yokoi* Takahiro Fujioka* Masanobu Kawase* Yukio Nishikawa* Hirofumi Muta* Thierry Dombreval* *Newly appointed

Managing Officer Managing Officer Managing Officer Managing Officer Managing Officer Managing Officer Managing Officer Managing Officer Managing Officer Managing Officer Managing Officer Managing Officer Managing Officer Managing Officer Managing Officer Managing Officer Managing Officer

As a result of the above changes, TMC now has, 1 chairman, 1 vice chairman, 1 president, 8 executive vice presidents, 13 senior managing directors, 1 honorary chairman, 1 senior advisor, member of the board, 7 auditors and 49 managing officers, for a total of 82 executives. 2. Retiring Corporate Auditors and Managing Officers (10 people) Yoshiro Hayashi (Appointed as Advisor)

Hiroshi Okabe Tadashi Ishikawa Hitoshi Nishiyama Alan J. Jones Yoshikatsu Tanaka Nobuyoshi Hisada Mitsuhisa Kato John H. Conomos Takis J. Athanasopoulos

(Appointed as Advisor) (Appointed as Advisor) (Appointed as Advisor) (Appointed as Advisor) (Appointed as Advisor) (Appointed as Advisor)

3. Executives' Areas of Responsibility and Titles 1) Executive Vice Presidents and Senior Managing Directors Name Tokuichi Uranishi New Executive Vice President -Global Planning Operations -Overseas (Americas, Europe & Africa, Asia, Oceania & Middle East) -The Americas Operations Group (Chief Officer) -Europe & Africa Operations Group (Chief Officer) Executive Vice President -Research & Development (R & D Management, Technical Administration, Design, Product Development, Vehicle Engineering, Motor Sports) -Technical Administration Group (Chief Officer) -Design Group (Chief Officer) -Motorsport Business Former Executive Vice President -Overseas (Overseas Planning Americas, Europe & Africa, Asia, Oceania & Middle East) -Europe & Africa Operations Group (Chief Officer)

Kazuo Okamoto

Executive Vice President -Research & Development (R & D Management, Technical Administration, Design, Product Development, Vehicle Engineering, Motor Sports) -Design Group (Chief Officer)

Management Dept. -Motor Sports Div. Kyoji Sasazu Mitsuo Kinoshita Executive Vice President -Global Planning Operations -Japan Sales Operations Executive Vice President -Corporate Planning -General Administration & Human Resources -Accounting -Information Systems -Business Development -Government & Public Affairs -Housing -General Administration & Human Resources Group (Chief Officer) -Global Audit Div. -Corporate Planning Div. Executive Vice President -Overseas (China) -Customer Service -China Operations Group (Chief Officer) Executive Vice President -Domestic Sales Operations Executive Vice President -Corporate Planning -General Administration & Human Resources -Finance & Accounting -Information Systems -Business Development -Government & Public Affairs -Housing -Global Audit Div. -Corporate Planning Div. -Research Div. Executive Vice President -Overseas (China) -Customer Service -China Operations Group (Chief Officer) -China Office Executive Vice President -Production -TQM -Environmental Affairs Executive Vice President -Quality Control -Research & Development (Power Train, Future Project) -Fuel Cell System Development -Power Train Development Group (Chief Officer) -Fuel Cell System Development Group (Chief Officer) Executive Vice President -Product Management -IT & ITS -Purchasing

Yoshimi Inaba

Takeshi Executive Vice President Uchiyamada -Production -TQM -Environmental Affairs Masatami Takimoto Executive Vice President -Quality -Research & Development (Power Train, Future Project) -Fuel Cell System Development -Power Train Development Group (Chief Officer) -Fuel Cell System Development Group (Chief Officer) -Future Project Div. Executive Vice President -Product Management -IT & ITS -Purchasing

Akio Toyoda

-Quality -IT & ITS Group (Chief Officer) -e-TOYOTA Div. Tetsuo Hattori Senior Managing Director -Vehicle Engineering Group (Chief Officer) -Environmental Affairs Div.

-IT & ITS Group (Chief Officer) -e-TOYOTA Div. Senior Managing Director -Quality Group (Chief Officer) -Vehicle Engineering Group (Chief Officer) -Future Project Div. -Motor Sports Div. Senior Managing Director -The Americas Operations Group (Chief Officer) -Toyota Motor Sales, U.S.A., Inc. Senior Managing Director -Finance & Accounting Group (Chief Officer) -Information Systems Group (Chief Officer) Senior Managing Director -Production Control & Logistics Group (Chief Officer) -Manufacturing Group (Chief Officer) -TQM Promotion Div. Senior Managing Director -Business Development Group (Chief Officer) -Purchasing Group (Chief Officer) Senior Managing Director -Overseas Planning Operations Group (Chief Officer) -Product Management Div. Senior Managing Director -General Administration & Human Resources Group (Chief Officer) -Housing Group (Chief Officer)

Yukitoshi Funo

Senior Managing Director -Toyota Motor North America, Inc. -Toyota Motor Sales, U.S.A., Inc. Senior Managing Director -Business Development Group (Chief Officer) -Accounting Group (Chief Officer) Senior Managing Director -Strategic Production Planning Group (Chief Officer) -Manufacturing Group (Chief Officer) -TQM Promotion Div. Senior Managing Director -Purchasing Group (Chief Officer)

Takeshi Suzuki

Atsushi Niimi

Hajime Wakayama

Hiroshi Takada

Senior Managing Director -Global Planning Operations Group (Chief Officer) -Product Management Div. Senior Managing Director -Government & Public Affairs Group (Chief Officer) -Housing Group (Chief Officer) -Legal Div. Senior Managing Director

Teiji Tachibana

Shinichi

Senior Managing Director

Sasaki

-Quality Group (Chief Officer) -Toyota Motor Europe NV/SA -Toyota Motor Engineering & Manufacturing Europe NV/SA

Shin Kanada

Senior Managing Director -Information Systems Group (Chief Officer) -Research Div. -Global External Affairs Div. Senior Managing Director -Asia, Oceania & Middle East Operations Group(Chief Officer) Senior Managing Director -Product Development Group (Chief Officer) -R&D Management Div. -TOYOTA Development Center 2 (General Manager) Senior Managing Director -Japan Sales Operations Group (Chief Officer) -Customer Service Operations Group (Chief Officer) Senior Managing Director -Production Engineering Group (Chief Officer)

Senior Managing Director -Government & Public Affairs Group (Chief Officer) Senior Managing Director -Asia, Oceania & Middle East Operations Group (Chief Officer) -Taiwan Office Senior Managing Director -Technical Administration Group -Product Development Group -Environmental Affairs Div. -R&D Management Div. Senior Managing Director -Domestic Sales Operations Group (Chief Officer) -Customer Service Operations Group (Chief Officer) Senior Managing Director -Production Engineering Group (Chief Officer)

Akira Okabe

Yoshio Shirai

Yoichiro Ichimaru

Shoji Ikawa

2) Managing Officers (Only those with new responsibilities or those newly appointed listed) Name Koichi Ina New -Miyoshi Plant (General Manager) -Myochi Plant (General Manager) -Operations Management Consulting Div. -Global Strategic Production Planning Div. -Production Control Div. -Project Planning & Management Div. -Global Production Center (General Manager) -China Div. -Toyota Technical Center, China -TQM Promotion Div. -Technical Service Div. -Customer Relations Div. -Quality Div. -Customer Quality Engineering Div. -Fuel Cell Production Engineering Div. -Toyota Motor Europe NV/SA -Toyota Motor Europe NV/SA (TMME Company) -Japan Sales Planning Div. -Japan Marketing Div. -Toyopet channel Operations Div. -Secretarial Div. -General Administration Div. -Human Resources Div. -Labor Relations Div. -Toyota Institute -Nagoya General Administration Div. -Toyota Technical Skills Academy -Medical Support Div. -Toyota Motor Engineering & Manufacturing North America, Inc** -Toyota Motor Engineering & Former -Takaoka Plant (General Manager) -Tsutsumi Plant (General Manager) -Vehicle Planning & Production Engineering Div. -Stamping Production Engineering Div. -Body Assembly Engineering Div. -General Assembly Engineering Div. -Toyota Technical Center, China -Customer Relations Div. -Quality Div. -Customer Quality Engineering Div. -Fuel Cell Production Engineering Div.

Akira Sasaki Iwao Nihashi

Tadashi Arashima Masamoto Maekawa Satoshi Ozawa

-Toyota Motor Europe NV/SA

-Domestic Sales Planning Div. -Domestic Marketing Div. -Toyopet channel Operations Div. -Corporate Planning Div. -Research Div. -Product Management Div.

Seiichi Sudo Yasuhiko

-Toyota Motor Manufacturing North America, Inc. -Toyota Technical Center, U.S.A.,

Ichihashi

Manufacturing North America, Inc**

Inc.

-Motorsport Business Management -Technical Administration Div. Tadashi -TOYOTA Development Center 1 Yamashina Dept -Engineering Data Control & (General Manager and Executive Management Div. Chief Engineer) -Motor Sports Div. -Engineering Data Control & -Technical Administration Div. Management Div. Takashi Hata -Corporate Planning Div. -Research Div. -Product Management Div. -LEXUS Product & Marketing Planning Div. -Toyota Motor North America, Inc. -Toyota Motor Engineering & Manufacturing North America, Inc** -Future Project Div. -Intellectual Property Div. -Higashifuji Technical Administration Div. -Power Train Engineering Div. 2 -Power Train Management Engineering Div. -Environmental Affairs Div. -Service Parts Administration Div. -Logistics Planning Div. -Production Parts Logistics Div. -Vehicle Logistics Div. -Service Parts Logistics Div. -Affiliated Companies Finance Div. -Accounting Div. -Cost KAIZEN Div. -Affiliated Companies Finance Division -Accounting Division -Finance Division -Toyota Motor Sales, U.S.A., Inc -Toyota Motor North America, Inc. -Toyota Motor Manufacturing North America, Inc. -Environmental Affairs Div. -Future Project Div. -Intellectual Property Div. -Higashifuji Technical Administration Div. -Power Train Engineering Div. 2 -Power Train Management Engineering Div. -e-TOYOTA Div. -Business Development Div. -Marine Business Div. -Biotechnology & Afforestation Business Div. (General Manager) -IT & ITS Planning Div. -IT & ITS Sales Div. -Secretarial Division -General Administration Div. -Human Resources Div. -Labor Relations Div. -Toyota Institute -Nagoya General Administration Div. -Toyota Technical Skills Academy -Medical Support Division

James E. Press Gary L. Convis Tatehito Ueda

Yasumori Ihara

Takahiko Ijichi

Toshio

-Motorsport Business Management -Overseas Planning Div.

Furutani

Dept. -Global Planning Div. -Global Marketing Div. -Toyota Motor Europe NV/SA (R&D/Manufacturing Company)

-Overseas Marketing Div.

Tetsuo Agata

-Honsha Plant (General Manager) -Environmental Affairs Div. -Global Strategic Production Planning Div. -Production Control Div. -Project Planning & Management Div. -Service Parts Administration Div. -Global Production Center (General Manager) -Motomachi Plant (General Manager) -Environmental Affairs Div. -Corporate Citizenship Div. -Global External Affairs Div. -Public Affairs Div. -Government & Industrial Affairs Div. -Corporate Public Relations Div. -Production Engineering Planning Div. -Production Engineering Development Div. -Partner Robot Development Div. -Instrumentation Engineering Div. -Fundamental Production Engineering Div. -Power Train Prototype Engineering Div. -Engine Production Engineering Div. -Drive Train Engineering Div. -Chassis Production Engineering Div. -HV Power Train Production Engineering Div.

Kazuhiko Takarada

-Motomachi Plant (General Manager) -Kinuura Plant (General Manager) -Motorsport Business Management Dept. -Corporate Citizenship Div. -Global External Affairs Div. -Public Affairs Div. -Government & Industrial Affairs Div. -Corporate Public Relations Div. -Production Engineering Planning Div. -Production Engineering Development Div. -Partner Robot Development Div. -Instrumentation Engineering Div. -Production & Logistics Systems Engineering Div. -Fundamental Production Engineering Div. -Power Train & Chassis Prototype Production & Engineering Div. -Engine Production Engineering Div. -Drive Train Engineering Div. -Chassis Production Engineering Div. -HV Power Train Production Engineering Div. -Teiho Plant (General Manager) -Teiho Plant Machinery & Die Engineering Administration Div. -Mechatronics Systems Div. -Stamping Die & Tool Div.

Masayuki Nakai

Toshiki Hayama

-Die & Mold Div. Takahiro Iwase -Kamigo Plant (General Manager) -Shimoyama Plant (General Manager) -Tahara Plant (General Manager) -Dealer Human Resources Development Div. -Japan Fleet Sales & Conversion Vehicle Div. -Toyota channel Operations Div. -Kamigo Plant (General Manager) -Shimoyama Plant (General Manager) -Dealer Human Resources Development Div. -Toyota channel Operations Div.

Katsunori Itasaka

-Toyota Motor Engineering & Real C. Tanguay Manufacturing North America, Inc* Ryoichi Sasaki*

-Toyota Motor Manufacturing North America, Inc. -Toyota Motor Manufacturing Canada, Inc.

-Asia, Oceania & Middle East -Toyota Motor Thailand Co., Ltd. Project Div. -Toyota Motor Asia Pacific PTE Ltd (Singapore) -Toyota Motor Asia Pacific Co., Ltd (Thailand) -Toyota Motor Thailand Co., Ltd -General Manager, Chassis Engineering Div. 2 -General Manager, LEXUS Domestic Sales & Marketing Div.

-TOYOTA Development Center 2 Seiho Kawakami* (Deputy General Manager) Yasuhiko Yokoi* Takahiro Fujioka* Masanobu Kawase* -Used Car Business Div. -LEXUS Domestic Sales & Marketing Div.

-Takaoka Plant (General Manager) -Senior Executive Director, Toyota -Tsutsumi Plant (General Motor Manufacturing (UK) Ltd. Manager) -TOYOTA Development Center 1 (General Manager) -Project General Manager, Technical Administration Div. -Project General Manager, Tokyo Secretarial Div.

-e-TOYOTA Div. Yukio Nishikawa* -Business Development Div. -Marine Business Div. -Biotechnology & Afforestation Business Div. -IT & ITS Planning Div. -IT & ITS Sales Div. Hirofumi Muta* -Honsha Plant (General Manager) -Vehicle Planning & Production Engineering Div. -Stamping Production Engineering

-General Manager, Production Engineering Planning Div.

Div. -Body Assembly Engineering Div. -General Assembly Engineering Div. -Hirose Plant (General Manager) -Hirose Plant Electronic Components Engineering Div. -Hirose Plant Electronic Components Manufacturing Div. -Toyota Motor Europe NV/SA Thierry Dombreval* (TMME Company) -Toyota Motor Europe NV/SA (TMME Company)

* Newly appointed **On April 1, 2006, Toyota Motor Engineering and Manufacturing North America, Inc. was established by integrating the functions of Toyota Technical Center, U.S.A., Inc. and Toyota Motor Manufacturing North America, Inc.

4. Organizational Changes 1) Domestic Sales Operations Group and Overseas Planning Operations Group - The Domestic Sales Operations Group and the Overseas Planning Operations Group have been reorganized. - Sales and planning functions, which were divided by region, i.e. domestic and overseas, have been integrated.

Purpose As a global business management function of Toyota's global headquarters, to allow close coordination between TMC and various regions, including Japan, and to implement the "most-suitable growth strategy from a global perspective" though product, price and supply-and-demand strategies

2) Government & Public Affairs Group / General Administration & Human Resources Group - The transfer of some divisions/departments of the General Administration & Human Resources Group to the Government & Public Affairs Group, have taken place as follows: After Changes Government & Public Affairs Group - Public Affairs Administration Dept. (transfer) - Tokyo Secretarial Div. (transfer) - Tokyo General Administration Div. (transfer) Before Changes General Administration & Human Resources Group - Public Affairs Administration Dept. - Tokyo Secretarial Div. - Tokyo General Administration Div.

Purpose To optimize the structural organization and distribution of human resources by consolidating the divisions and departments relevant to government & public affairs 3) Production Control & Logistics Group - The name of the Production Control & Logistics Group has changed. After Change Strategic Production Planning Group (name changed) Before Change Production Control & Logistics Group

Purpose To create a name that reflects a strengthened stance toward planning that considers the actual situation of global production activities 4) Housing Group (Housing Company) - The name of the Housing Group (Housing Company) has changed. After Change Housing Group (name changed) Before Change Housing Group (Housing Company)

Purpose To reflect the achievement of the original objective to reinforce operational structures through the introduction of the "company" system 5) Divisions/departments not belonging to a group; Asia, Oceania & Middle East Operations Group; China Operations Group - The transfer of some divisions/departments to relevant groups. After Changes Before Changes

Asia, Oceania & Middle East Operations Group - Taiwan Office (transfer) China Operations Group - China Office (transfer)

Divisions/departments not belonging to a Group - Taiwan Office - China Office

Purpose To clarify the chain of command and to optimize the structural organization and distribution of human resources As a result of the above changes, the number of divisions has increased from 228 to 229.

GROWTH
Lasting growth for Toyota will depend on aligning our interests with the larger interests of customers and the community. We must be a company where people think seriously about the role and responsibility of their company in the world. Our economic and industrial contribution in each region grows, for example, as we globalize our operations. Another way to align our interests with the larger interests of the community is through technology.

By the end of 1997, we will introduce the world's first new-energy transport that is commercially competitive with conventional automobiles. That is when we will put a hybridelectric passenger car onto the market in Japan. Our hybrid-electric car will have a gasoline engine to generate electricity or provide supplementary power to the wheels. It is twice as fuelefficient as conventionally powered vehicles of comparable size and performance. Equally important, the value of its potential fuel savings could prove greater than its cost premium over conventional vehicles. So, it actually could save money for car owners.

Survival and growth in our industry will hinge on developing technologies for reducing environmental impact of our products and operations, as well as improving vehicular safety.

Photos and text on the following pages introduce some of the technologies we are developing to position Toyota as an environmental leader.

SPRIORITIES OF TOYOTA IN GROWTH STRATEGY

Fortifying our product line Asserting a competitive edge in technology Accelerating globalization Reclaiming market share in Japan Cultivating demand in new business sectors

Measures for asserting a competitive edge in technology have centered on environmental themes. We have introduced or demonstrated new power train technologies in the past year that will make Toyotas run cleaner and greener than ever. Those technologies include...

A direct-injection system that makes gasoline engines more efficient Hybrid-electric systems that double fuel efficiency and reduce noxious emissions Pure electric, "zero emission" vehicles that alleviate urban pollution Fuel-cell systems that could transform the automobile in the 21st century.

MARKET SHARE OF TOYOTA

Toyota Motor Corp. grabbed more U.S. retail market share than Ford Motor Co. in early November and it was less than one share point behind General Motors Corp., Toyota, Japan's largest automaker, had a 15.4 percent U.S. retail market share a year earlier. Toyota plans to enter small car segment in India Worlds second largest automaker wants to get offensive in the Indian domestic auto market. Toyota is very much interested in launching a small car here in the segment currently dominated by Maruti Suzuki and Hyundai. Tata also has a decent presence in the market with their Indica range of diesel vehicles. Toyota is at the moment carrying out a feasibility study for launching such a vehicle in the domestic market where it has models like the Innova and Camry amongst others. They have had an incredible success with their stopped Qualis model and are selling Toyota Innova in large numbers. T Ino, director (marketing), Toyota Kirloskar Motor Pvt Limited has expressed that the Indian auto market is a huge one and has the capacity to involve more players in the small car segment. Toyota has a variety of interesting models in its global lineup, which it can consider to launch in the Indian market. Some of these are Vios, Platz, and Passo. The company also expects to break even here in India this year with all the accumulated losses were expected to be wiped out during 2005. They also plan to invest around Rs 130 crores during the current year to enhance efficiency.

PRODUCTS (GLOBAL): 1. AVALON 2. CAMRY 3. CAMRY SALORA 4. COROLLA ALTIS 5. MATRIX 6. PRIUS 7. 4RUNNER 8. HIGH RUNNER 9. LAND CRUISER

10.SEQUOIA 11.SIENNA

PRICE:As far as pricing strategy of Toyota is concerned. They are focusing on the very segment of the market not only particular segment. Basically they are focusing on official and business class people

CAR MODELS (INDIA) INNOVA

EX- SHOWROOM (MUMBAI) AMOUNT IN INR. 8,01,738

COROLLA ALTIS

11,31,900

CAMRY

22,84,800

PRADO

42,27,300

Table 1.1

FUTURE PLANS

India's car population may be growing but the growth is mainly concentrated in the small car sector, and not without reason. With increasing interest rates making buying cars costlier and the government slapping new duties on larger vehicles in addition to the existing favorable tax regime for smaller cars, even premium players are wading into the small-car scene. Indian passenger car sales rose by 11.79 per cent between April 2007 and March 2008 to 1.2 million units. Competition in the small car segment is set to increase in 2009, with planned launches by Maruti Suzuki (A-Star and Splash), Honda (Jazz) and as yet unnamed models from Ford, GM and Volkswagen. Japanese carmaker Toyota, all set to surpass General Motors as the world's largest, is the latest entrant when it made its intentions clear on the occasion of the laying of the foundation stone for its second factory in India.

The decade-old Indian joint venture of the Japanese automaker, Toyota Kirloskar, is building its second plant at Bidadi, about 40 kilometers from India's IT hub of Bangalore, with an upfront investment of Rs14,000 crore ($329 million) to manufacture a range of passenger cars and multi-utility vehicles. Toyota is the majority partner with an 89-per cent stake with Kirloskar owning the rest. Karnataka chief minister B S Yeddyurappa unveiled the foundation stone for the new plant that will have a test track and additional space for suppliers and other vendors. The ceremony was attended by Toyota senior managing director Akira Okabe, chairman Ryoichi Sasaki, vicechairman Vikram Kirloskar and managing director Hiroshi Nakagawa. The modular plant, to be commissioned by 2010, will have an installed capacity of 100,000 units annually and will employ about 2,400 people. Top officials confirmed that the company will soon be introducing its newly designed compact car in the Indian market. The factory will be ready by mid-2010 and we are yet to finalize the launch date of the new car. We have basic concept of the new car ready and very shortly we will finalize the design of the car.'' The plant which is being set up will see an initial investment of Rs1400 crore. But this initial investment won't include certain other costs like installing robots and other automation equipment. The arrangement of this additional amount required for the plant would be worked out later. A new test track will be included in the second plant, which is expected to be spread over 130 acres of land. Though the new compact car has been designed for the Indian market, the initial design features indicate that it can be exported to other markets in Asia. Daihatsu, Toyota's group company, will not be involved in designing the compact new car, though it may be included in future plans. However, Tata Motors and Bajaj Auto can rest easy for the time being. Although Okabe confirmed that the new product will be the cheapest in the Toyota stable, indications are that it maybe priced higher than its Indian competitors.

Vikram Kirloskar said as much when he commented, ''We are working on the new design. The model is yet to be finalized. We plan to have petrol as well as diesel versions. The small car will not compete with the upcoming Nano of Tata Motors, touted to be the world's cheapest car.''

GENERIC STRATEGIES
Generic strategies were used initially in the early 1980s, and seem to be even more popular today. They outline the three main strategic options open to organization that wish to achieve a sustainable competitive advantage. Each of the three options are considered within the context of two aspects of the competitive environment: Sources of competitive advantage - are the products differentiated in any way, or are they the lowest cost producer in an industry? Competitive scope of the market - does the company target a wide market, or does it focus on a very narrow, niche market?

Figure 1.1

The generic strategies are: 1. Cost leadership, 2. Differentiation, and 3. Focus. 1. Cost Leadership The low cost leader in any market gains competitive advantage from being able to many to produce at the lowest cost. Factories are built and maintained; labor is recruited and trained to deliver the lowest possible costs of production. 'cost advantage' is the focus. Costs are shaved off every element of the value chain. Products tend to be 'no frills.' However, low cost does not

always lead to low price. Producers could price at competitive parity, exploiting the benefits of a bigger margin than competitors. Some organization, such as Toyota, are very good not only at producing high quality autos at a low price, but have the brand and marketing skills to use a premium pricing policy.

2. Differentiation
Differentiated goods and services satisfy the needs of customers through a sustainable competitive advantage. This allows companies to desensitize prices and focus on value that generates a comparatively higher price and a better margin. The benefits of differentiation require producers to segment markets in order to target goods and services at specific segments, generating a higher than average price. For example, Toyota differentiates its product and service. The differentiating organization will incur additional costs in creating their competitive advantage. These costs must be offset by the increase in revenue generated by sales. Costs must be recovered. There is also the chance that any differentiation could be copied by competitors. Therefore there is always an incentive to innovated and continuously improve. 3. Focus or Niche strategy The focus strategy is also known as a 'niche' strategy. Where an organization can afford neither a wide scope cost leadership nor a wide scope differentiation strategy, a niche strategy could be more suitable. Here an organization focuses effort and resources on a narrow, defined segment of a market. Competitive advantage is generated specifically for the niche. A niche strategy is often used by smaller firms. A company could use either a cost focus or a differentiation focus. With a cost focus a firm aims at being the lowest cost producer in that niche or segment. With a differentiation focus a firm creates competitive advantage through differentiation within the niche or segment. There are potentially problems with the niche approach. Small, specialist niches could disappear in the long term. Cost focus is unachievable with an industry depending upon economies of scale e.g. telecommunications.

1.4 S.W.O.T ANALYSIS

Strengths
New investment by Toyota in factories in the US and China saw 2005 profits rise, against the worldwide motor industry trend. Net profits rose 0.8% to 1.17 trillion yen ($11bn; 5.85bn), while sales were 7.3% higher at 18.55 trillion yen. Commentators argue that this is because the company has the right mix of products for the markets that it serves. This is an example of very focused segmentation, targeting and positioning in a number of countries. In 2003 Toyota knocked its rivals Ford into third spot, to become the World's second largest carmaker with 6.78 million units. The company is still behind rivals General Motors with 8.59 million units in the same period. Its strong industry position is based upon a number of factors including a diversified product range, highly targeted marketing and a commitment to lean manufacturing and quality. The company makes a large range of vehicles for both private customers and commercial organisations, from the small Yaris to large trucks. The company uses marketing techniques to identify and satisfy customer needs. Its brand is a household name. The company also maximizes profit through efficient manufacturing approaches (e.g. Total Quality Management).

WEAKNESS
Being big has its own problems. The World market for cars is in a condition of over supply and so car manufacturers need to make sure that it is their models that consumers want. Toyota markets most of its products in the US and in Japan. Therefore it is exposed to fluctuating economic and political conditions those markets. Perhaps that is why the company is beginning to shift its attentions to the emerging Chinese market. Movements in exchange rates could see the already narrow margins in the car market being reduced. The company needs to keep producing cars in order to retain its operational efficiency. Car plants represent a huge investment in expensive fixed costs, as well as the high costs of training and retaining labour. So if the car market experiences a down turn, the company could see over capapacity. If on the other hand the car market experiences an upturn, then the company may miss out on potential sales due to under capacity i.e. it takes time to accommodate. This is a typical problem with high volume car manufacturing.

OPPURTUNITIES
Lexus and Toyota now have a reputation for manufacturing environmentally friendly vehicles. Lexus has RX 400h hybrid, and Toyota has it Prius. Both are based upon advance technologies developed by the organization. Rocketing oil prices have seen sales of the new hybrid vehicles increase. Toyota has also sold on its technology to other motor manufacturers, for example Ford has bought into the technology for its new Explorer SUV Hybrid. Such moves can only firm up Toyota's interest and investment in hybrid R&D. Toyota is to target the 'urban youth' market. The company has launched its new Aygo, which is targeted at the streetwise youth market and captures (or attempts to) the nature of dance and DJ culture in a very competitive segment. The vehicle itself is a unique convertible, with models extending at their rear! The narrow segment is notorious for it narrow margins and difficulties for branding.

THREATS

Product recalls are always a problem for vehicle manufacturers. In 2005 the company had to recall 880,00 sports utility vehicles and pick up trucks due to faulty front suspension systems. Toyota did not give details of how much the recall would cost. The majority of affected vehicles were sold in the US, while the rest were sold in Japan, Europe and Australia. As with any car manufacturer, Toyota faces tremendous competitive rivalry in the car market. Competition is increasing almost daily, with new entrants coming into the market from China, South Korea and new plants in Eastern Europe. The company is also exposed to any movement in the price of raw materials such as rubber, steel and fuel.

1.5 COMPETITVE S.W.O.T ANALYSIS

STRENGTH
In an era when owning a car was a distant dream for a vast majority of Indians, MUL rolled out its first car, the M800. The company labeled it a people's car, with a 796cc 3-cylinder engine that delivered 39.5bhp at an affordable price of Rs. 65,000. The first vehicle was released for sale in December 1983. Initially, the car was criticized for its diminutive size, but it proved to be spacious enough to carry four adults. Better technology and an affordable price due to a higher level of indigenization helped MUL achieve a dominant position in the Indian passenger car market

WEAKNESS

MARUTI SUZUKIs biggest weakness, is the lack of product design capability. In the coming years, they should focus on acquiring product design and lean production know-how (as the Korean firms did in the eighties and early nineties. Also the Research and developments headquarters for engine development of Maruti Suzuki are in Japan which is a major weak point. Maruti Suzuki also needs to invest in capacity and research and development in India to stay abreast of competition.

THREAT
M800 had ruled the passenger car market as the only car in the entry-level segment in the Indian automobile industry and was now facing the danger of cannibalization from one of its own family members, Alto For the first few months of 2004, M800 performed well, selling 15,301 units in January, 13,518 units in February and 15,540 in March. But gradually Alto, another MUL product, began eating into M800's share. Alto reported sales of 8,399 units, 8,324 and 9,011 units in January, February and March respectively. In April, its sales increased to 9,350 units and in May 2004, Alto took over M800's position as the largest selling car with sale of 10,373 units, slightly over M800's sales of 10,016 units. Analysts felt that Alto had taken the top spot because of its price reduction in September 2003 by Rs. 23,000 followed by the launch of the non-AC Alto for Rs. 0.23 mn in the first week of April 2004.

CHAPTER 3 OBJECTIVE AND METHODOLOGY 3.1 SIGNIFICANCE

Toyota's believes in putting the customer first and aims to provide the best levels of customer satisfaction as its main marketing strategy. Their dealers have also worked hard to provide their high levels of customer support." "In the last one year, Toyota has taken many initiatives, which has made Innova the most successful product. Innova has successfully become a category creator. We will continue to meet the ever-challenging customer expectations and will come out with innovative marketing strategies. With a change of guard at Toyota Kirloskar Motor Ltd., the company has evolved a new strategy to capture 15 per cent market share in the Indian automotive segment. Effective from January 1, Atsushi Toyoshima has been appointed Managing Director of the company, replacing Sachio Yamazaki. "Competition is intense in the Indian market for domestic and foreign companies. The Indian market is important for Toyota with potential to aid its growth strategy," Yoshio Ishizaka, Executive Vice-President, Toyota Motor Corporation, said. According to analysts, the Indian market would touch annual sales of 1.2 million units by 2005. Last year, Toyota sold 3.8 million units overseas, manufacturing six million vehicles at 56 plants in 25 countries. In India, the Toyota Quails notched sales of 25,000 units since its launch last year, he said. Toyota's strategy to corner a significant chunk of the Indian market involves "superior product offering and dedicated technology". In this context, the change of leadership in Toyota's Indian division is important, indicating a more important role for the company's manufacturing base in Bangalore. "Bangalore is an ideal location to meet all of Toyota's needs, including auto components," Mr. Toyoshima said According to the managing director of Toyota Kirloskar Motor, Atsushi Toyoshima, the decision to introduce Innova here (India) was based on three factors. First, over the last five years, the C- segment (between Rs 5 lakh to Rs 10 lakh) of the car market has grown by 20 per

cent every year. The multi utility vehicle segment has also grown at double-digit levels. Second, with an improving lifestyle and better roads, the Indian consumer wants to take his vehicle for long drives with friends and family. Third, there is a latent desire of customers, including those owning MPVs, to seek attributes like greater interior space and overloading ability, while passenger car buyers look for better styling and improved riding comfort. Innova brings together the space and fuel economy of an MPV with the style, agility and power of a sedan. Toyota Kirloskar Motor has described it as the first three-row seating passenger car in the Indian market

3.2 MANAGERIAL USEFULLNESS

The marketing department can use this study to enhance their marketing strategies for better sales. This report helps the marketing department in taking decisions to what change in distribution channels and what should be done so that marketing problem could be sorted out and how to sell their range of product in the competitive market. The very essence of every project related to marketing is providing a view to management for chalk out the organization, so that they can maintain a viable fit between the organizational objectives, skills and resources and its changing market opportunities. also give a proper shape to company's target profit and growth. it provides feedback to the organization about their sales, sales schemes and what impact does it has on the dealers and consumers. every market research provides useful suggestions to the organization. marketing research helps the firm in every component of the total marketing task. it helps the firm acquire a better understanding of the buyer, the competition and the marketing environment. it also aids the formulation of the marketing mix. product. distribution and pricing needs. it also helps in taking the information of competitor's strategies and their impact on the buyer. the study reveals the fact that may have come up during the project and these facts can either be used a opportunities in exploring and expanding the business as well as can be used as safeguard against threats by competitors to

prepare an effective marketing strategy. Every market research proves useful to the organization. Marketing research helps the firm in every component of total marketing task.

3.3 OBJECTIVES OF STUDY

The object of report is not only to focus on competitors but also to get the competitive position in the national as well as international market through customer satisfaction. These are as follows. To discover and translate the needs and desire of customer into products and services so as to create the demand of the product (through planning and producing planned product). To serve the customer through channel of distribution. To face the keen competition. To know about the marketing strategies used by Toyota. To know about the marketing strategies of the competitors of Toyota. To find out the market share of Toyota. To know where Toyota stands as far as the BCG matrix models concerned.

3.4 SCOPE OF THE STUDY

These are some of the scope of the study :

1. The present study can be extended to access the present marketing condition of Indian automobile sector. 2. The study can be used to design a proper product, price, place and promotional strategy for the market. 3. From the present study we can know the market share of different products and accordingly formulated strategy to enhance it. 4. The result of marketing success can be interpreted to assess the rate of employee satisfaction in various departments. 5. This study can be applied to find out an effective distribution channel to enhance the sale of various products of Toyota motors.

3.5 RESEARCH METHODOLOGY

This project depends upon the primary as well as secondary sources which are as follows.

Primary Source: Observation Experiment Talking with consumers,retailers and distributors. Secondary Source: Balance sheet of the company Company website

SAMPLE SIZE AND AREAS COVERED

A customer-based survey was conducted in which 100 people were asked to fill the questionnaire in which 50 people belong to cities of CHANDIGARH and MOHALI. Because it was not possible to consider each and every person of those cities or of villages so, PROBABILITY SAMPLE or RANDOM SAMPLE was taken.

STATISTICAL AND PRESENTAION TOOLS

PRIMARY DATA is represented: First classified i.e. grouped qualitatively and quantitatively according to the situation or the type of the data which was collected. After classifying is represented in the form of tables i.e. systematically arranged in columns and rows. Some of the data is also graphically represented in the form of PIE DIAGRAM.

SECONDARY DATA is represented: In the form of tables. By the way of BAR GRAPHS and SUBDIVIDED BAR GRAPHS (Graphical presentation).

3.6 LIMITATIONS OF THE STUDY

Since the road to improvement is never ending, so this study also suffers from certain limitations. Some of them are as follows: Because of illiteracy, it was a time consuming method in which continuous Questionnaire method involves some uncertainty of response. Co-operation on It is possible that the information supplied by the informants may be incorrect.

guidance was required. the part of informants, in some cases, was difficult to presume. So, the study may lack accuracy.

CHAPTER 4 - DATA ANALYSIS

4.1

PERCENTAGE OF TOYOTA OWNERS

OW NERS OF TOYOTA
YES 24% NO 76%

YES NO

Figure 1.3 INFERENCE: 24% of the respondents were owners of Honda 76% of the respondents were owners of Toyota

4.2

CUSTOMER SATISFACTION RATING

CUSTOMER SATISFACTION

17%

SATISFIED DISSATISFIED

83%

Figure 1.4 INFERENCE: 83% of the Respondents were satisfied with their cars and the services of TOYOTA However 17% of the Respondents were dissatisfied at the same time.

4.3

PREFERENCES OF BUYING A NEW CAR

PREFERENCES OF BUYING A NEW CAR

40 30 20 10 0 TOYOTA HYUNDAI MARUTI HONDA

Figure 1.5 INFERENCE: 18% of the respondents would prefer to buy a Toyota car against its competitors. 37% of respondents preferred for Maruti. 21% and 24% respectively preferred for Hyundai & Honda.

4.4

WHERE DO YOU MANAGE TO FIND INFORMATION ABOUT

TOYOTA

INFORMATION ABOUT TOYOTA

12% 20% 55% 13% DEALERS PRINT MEDIA T.V. INTERNET

Figure 1.6 INFERENCE: Information through Internet and Print media accounts for more than half or 75% of the information shared with the masses. Rest 25% was shared by T.V. and Dealers for providing the information.

4.5

TOYOTA CARS HAS THE MOST FUEL EFFICIENCY

F UE L E F F IC IE NC Y O F T O YO T A
100 80 60 40 20 0 78

22

Y ES

NO

Figure 1.7 INFERENCE: 78% of the respondents felt that Toyota has the most fuel efficiency. While 22% felt it isnt the most fuel efficient.

4.6

THE FEATURES OF TOYOTA AS COMPARED TO OTHER CARS

FEATURES OF TOYOTA
12% 8% 10%

70%

GOOD VERY GOOD NOT SO GOOD SATISFACTORY

Figure 1.8 INFERENCE: 70% of the respondents felt that the features of the Toyota are good. While 8% of respondents thought it was not so good, 10% thought it was very good and 12% felt satisfactory about the features.

4.7

THE QUALITIES THAT BEST DESCRIBES TOYOTA

FEATURES THAT BEST DESCRIBES TOYOTA

40 30 20 10 0 HANDLING FUEL EFFICIENCY DESIGN COM FORT 15 18 38 29

Figure 1.9 INFERENCE: Toyota is best known for its design & comfort. Then comes Handling and Fuel Efficiency.

4.8

HOW DO YOU FIND THE INTERIORS OF TOYOTA

INTERIORS OF TOYOTA
3% 16% 7%

GOOD VERY GOOD NOT SO GOOD

74%

SATISFACTORY

Figure 1.10 INFERENCE: The interiors of Toyota are very good according to 74% of the respondents. 16% said it was very good, 7% said it was satisfactory and 3% felt it was not so good.

4.9

WHAT SHOULD BE DONE TO IMPROVE TOYOTA ?

WHAT SHOULD BE DONE TO IMPROVE TOYOTA 13%

15% 72%

MAKE IT MORE AFFORDABLE CHEAPER SPARE PARTS MORE SERVICE STATIONS

Figure 1.11 INFERENCE: If Toyota is made more affordable then it would win more customers, a theory which was backed by 72% of the respondents. 15% and 13% respectively want cheaper spare parts and more service stations.

4.10

WHAT SHOULD BE DONE TO MAKE TOYOTA THE BEST CAR

WHAT SHOULD BE DONE TO MAKE TOYOTA THE BEST CAR 15 10 15 60

MAKE IT MORE FUTURISTIC MAKE IT MORE SPORTY GIVE IT A RETRO LOOK GIVE IT A CONCEPT CAR LOOK
Figure 1.12 INFERENCE: To make it the best car in its class it should be made more futuristic which was felt by 60% of the respondents. 15% of the respondents thought it should be made more sporty. 10% wanted it to have a retro look and 15% wanted to give it a concept car look.

4.11

ARE YOU HAPPY WITH THE AFTER SALES SERVICES PROVIDED

BY TOYOTA

HAPPY WITH AFTER SALES SERVICES PROVIDED BY TOYOTA

15%
HAPPY UNHAPPY

85%
Figure 1.13 INFERENCE: Overall 85% of the respondents were happy with the after sales service provided by Toyota. 15% were unhappy with Toyota due to poor after sales services provided by them.

CHAPTER 5 FINDINGS AND RECOMMENDATIONS

5.1 FINDINGS

76% of the respondents were owners of Toyota

83% of the Respondents were satisfied with their cars and the services of TOYOTA, However 17% of the Respondents were dissatisfied at the same time 18% of the respondents would prefer to buy a Toyota car against its competitors Information through Internet and Print media accounts for more than half or 75% of the information shared with the masses. Rest 25% was shared by T.V. and Dealers for providing the information 78% of the respondents felt that Toyota has the most fuel efficiency 70% of the respondents felt that the features of the Toyota are good. While 8% of respondents thought it was not so good, 10% thought it was very good and 12% felt satisfactory about the features Toyota is best known for its design & comfort. Then comes Handling and Fuel Efficiency. If Toyota is made more affordable then it would win more customers, a theory which was backed by 72% of the respondents.15% and 13% respectively want cheaper spare parts and more service stations. To make it the best car in its class it should be made more futuristic which was felt by 60% of the respondents.15% of the respondents thought it should be made more sporty.10% wanted it to have a retro look and 15% wanted to give it a concept car look.

5.2 RECOMMENDATIONS
Toyota should adopt the defensive marketing strategy because as being the second largest car producer in the international market,

Toyota must at the moment carry out a feasibility study for launching a vehicle in the domestic market where it has models like the Innova and Camry amongst others.

Toyota should conduct market survey in Indian market for quails in order to know the perception of Indian consumers.

Toyota should adopt an offensive marketing strategy for entering in the small car segment. This market is dominated by Maruti Suzuki and Hyundai in the Indian domestic auto market.

Toyota must plan out an ideal marketing producing capacity ,becaue it faces the problem of over and under capacity in case of upturn and downturn of the market.

ANNEXURE QUESTIONNAIRE FOR CONSUMER

A) NAME B) ADDRESS C) CONTACT NUMBER D) INCOME GROUP _________15,000-25,000 _________50,000-75,000 _________25, 000-50,000 _________Above 75,000

1. DO YOU OWN A CAR? o YES NO

IF YES, THEN WHICH ONE? (i)TOYOTA (ii) HYUNDAI (iii) MARUTI

2. HOW SATISFIED ARE YOU WITH THE SERVICES OFFERED BY TOYOTA ? (i)SATISFIED (ii) DISSATISFIED

3. IF SATISFIED, THEN ARE YOU HAPPY WITH THEIR CHARGES AND TIMELY DELIVERY THEY WERE OFFERING? (i)HAPPY (ii) UNHAPPY

4. IF GIVEN A CHOICE TO CHOOSE A CAR COMPANY, WHICH COMPANY WOULD YOU CHOOSE?

(i) TOYOTA

(ii) MARUTI

(iii) HYUNDAI

5. WHERE DO YOU MANAGE TO FIND INFORMATION ABOUT TOYOTA ? (i)DEALERS (iii)T.V. (ii) PRINT MEDIA (iv)INTERNET

6. DO YOU THINK TOYOTA HAS THE MOST FUEL EFFICIENCY (i)YES (ii) NO

7. HOW DO YOU FIND THE FEATURES OF TOYOTA AS COMPARED TO OTHER CARS? (i)GOOD (iii)NOT SO GOOD (ii) VERY GOOD (iv) SATISFACTORY

8. WHICH OF THESE QUALITIES DO YOU THINK BEST DESCRIBES TOYOTA ? (i)HANDLING (iii)DESIGN (ii) FUEL EFFICIENCY (iv)COMFORT

9. HOW DO YOU FIND THE INTERIORS OF TOYOTA ? (i)GOOD (ii) VERY GOOD

(iii)SATISFACTORY

(iv) NOT SO GOOD

10. ACCORDING TO YOU WHAT SHOULD BE DONE TO TOYOTA ? (i) MAKE IT MORE AFFORDABLE (ii) CHEAPER SPARE PARTS (iii)MORE SERVICE STATIONS

IMPROVE

11. ACCORDING TO YOU WHAT SHOULD BE DONE TO MAKE TOYOTA THE BEST CAR? (i)MAKE IT MORE FUTURISTIC (ii)MAKE IT MORE SPORTY (iii)GIVE IT A RETRO LOOK (iv)GIVE IT A CONCEPT CAR LOOK

12. ARE YOU HAPPY WITH THE AFTER SALES SERVICES PROVIDED BY TOYOTA ? (i)YES (ii) NO

(iii) HAPPY BUT IT CAN BE BETTER

BIBLIOGRAPHY
Books: Kotler Philips, Marketing Management: 30th Edition Chabra T.N., Marketing management 2005 C.B. Gupta, Marketing management 2006 Magazines Business standard Motoring May 2008 edition Internet: www.google.com www.toyota .com www.yahoo.com www.domain-b.com

www.wikipedia.com