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Toyota Motor Corporation - Case Study Example

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From the paper "Toyota Motor Corporation" it is clear that the company’s lower gross margin is traced to the fewer sales of higher-margin large trucks and large cars. Also, the company largely attributes the loss it incurred from the bankruptcy of its major supplier, Delphi Corporation…
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Toyota Motor Corporation
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Download file to see previous pages GM is recognized as the largest vehicle manufacturer selling 8.5 billion cars in 2001 while its sales in 2002 account for 15% of the trucks and vehicles sold globally (Yahoo Finance 2006).
Traditionally, GM's approach to marketing its products is targeting a specific market segment for a specific brand so that the company's products do not compete with each other. These were profitable for the automotive firm as the brand's shared components and common corporate management gave way to substantial economies of scale while the distinctions between the brands created an "orderly upgrade path." Before 1995, the company has a full range of products ranging from Chevrolet which is offered to an entry-level buyer who is more concerned on a more practical and economical vehicle to the upscale Cadillac which is targeted to the elite market as it is regarded as the "standard of luxury (General Motors 2006)." Nevertheless, this strategy did not persist as the GM started to implement a gradual blurring of its divisions during 1995. This strategy leads to cannibalization in the market share of GM as each division competes with each other (General Motors 2006).
During 2004, the company has announced a new strategy for its product lines which is apart from the traditional marketing and positioning it employs. This shift in brand strategy is targeted in "building sales, cutting costs, and bolstering brand identity (Garsten 2005)."
For Chevrolet and Cadillac, GM is planning to maintain its present strategy of making them high volume brands that offer the vehicle in every major segment by having a broad product line up. Buick, Pontiac and GMC will be combined into a single sales channel which offers trucks, premium and near-luxury vehicles and performance models. In addition, these product lines will be trimmed as GM plans to drop some models in this category. Saab is seen to offer exclusive European styled and engineered sedans, crossover and SUV models. HUMMER will continue to manufacture exclusive, premium SUVs and trucks. Lastly, Saturn will be upgraded as this division will offer more upscale models which are styled and engineered to European standards. This product line will be slotted between Chevrolet and Buick (Garsten 2005).
Complementing these marketing strategies are three global technology strategies: offering technology which has a real impact and is valued by the customer; technology which meets basic objectives of cutting costs to offer competitive prices; and sustainable technology which improves vehicle emissions and fuel economy (GM Global Technology Strategy 2004).
Armed with these strategies, GM is geared to conquer the global market in the next decade.
External Factors
Currently, General Motors Corporation (GM) leads the automotive industry with total revenue of US$192.60 billion during 2005. This is amidst the US$2.6 billion loses incurred during the same year which is due to the weak demand in North America. Following GM is Ford Motor Corporation (US$178.10 billion), Daimler Chrysler AG (US$177.37billion), and Toyota Motor Corporation (US$162.92 billion). Even though smaller in terms of revenue, it is notable that Toyota recorded the largest net income at US$10.61 billion during 2005 (Yahoo Finance 2006). ...Download file to see next pagesRead More
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