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Industry Analysis - Term Paper Example

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An industry consists of a number of firms which produces goods that are close substitutes for each other. The structure of the automobile industry is that of an oligopoly with a few firms showing dominance. Toyota Motor Corporation is one of those firms. …
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Industry Analysis
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Industry Analysis

Download file to see previous pages... Toyota Motor Corporation is one of those firms. The other top firms are Ford Motor Company, General Motors Company and Honda Motor Company. The automobile industry has been through a number of revolutions starting with standardized mass production which was instigated by Henry Ford; the second which was designed by Alfred Sloan included the organizational ‘creation of the Corporation with multi-product divisions emphasizing marketing and branding;’ the third revolution was created by Eiji Toyoda of Toyota Motor Corporation which focused on lean manufacturing and the development of quality (Maxton and Wormald 2005). The automobile is one of the most important industries in the world in terms of its contribution to GDP; it uses large steel and glass and consumes a high percentage of the world’s oils (Maxton and Wormald 2004). In addition to the transportation of people to various locations in order to facilitate various activities, it has also contributed to the flexibility of the human race in terms of the transportation of goods for consumption and production. However, automobiles have lead to million of casualties on our roads, pollution of the environment, depletion of natural resources and global warming (Maxton and Wormald 2004). These have gained significant attention and have led to increasing legislation. The automobile industry is also very capital intensive due to the complex nature of the automobile. ...
Some of Toyotas well known models are the Corolla in the compact range; Camry in the sedan range; Land Cruiser in the SUV category; the Lexus line in the luxury line; Celica in the sports line; the Tundra in the truck line; and the Coaster in the bus line. The Toyota Camry has been the best selling motor vehicle in America for 13 of the last 14 years (Toyota Motor Corporation). The Camry has won a number of awards 2.0 Analysis of the Industry Porter’s Five Forces model can be used to analyze the environment in the automobile industry. Porter indicates that there are five forces in an industry environment which work together to determine profitability and attractiveness in the long run. The five forces will assist firms like Toyota Motor Corporation determine their strength and competitive position. Walton (1999) indicates that a firm can be effective strategically once it can manipulate the forces in a way that is favorable to it. The more it does so the more it will achieve its goals. The five competitive forces in Porter’s Five Forces model are: the threat of substitutes; barriers to entry; rivalry in the industry; bargaining power of suppliers; and bargaining power of customers. The model is shown in Figure 1. Figure 1 – Porter’s Five Forces Model 2.1 Threat of new substitutes A substitute is anything that is able to serve as replacement. In this case it specifically relate to anything that will help in transporting goods and people. There are a number of options available to customers who want to move from one place to another. They include bicycles and bikes for people travelling short distances. Bicycles are cheaper as they do not require fuel. However, they take ...Download file to see next pagesRead More
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I didn’t know how to start my text. "Industry Analysis" helped me out a lot! Especially the list of resources was valuable.
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