Alfuttaim Motors Toyota - Essay Example

ALFUTTAIM MOTORS TOYOTA Affiliation ALFUTTAIM MOTORS TOYOTA Alfuttaim Motors is an exclusive distributor of Toyota, Toyota material handling equipment, Hino Trucks and Lexus. It was established in the year 1955 and it is based in the UAE. Alfuttaim motors control a huge network of showrooms as well as service centers. Its main principles are engagement, integrity and transparency towards its customer base (Alfuttaim Motors LLC, 2015). The following discussion is going to give a comparative market analysis of Alfuttaim Motors Toyota. Target Market of Alfuttaim Motors It is widely recognized that the Alfuttaim motors is the leading distributor of automobiles and automotive merchandises in the UAE (Alfuttaim Motors LLC, 2015). This has made it to enhance the robust development of the automotive industry of the UAE as well as contributing to its significant growth widely. Alfuttaim motors have the greatest number of its vehicles on the road as compared to other automobile manufacturers in the world. Its vehicle brands target both the middle-class economy as well as the first-economy economy (Nayak & Josh, 2012). Its vehicle brand, the Lexus, targets the first-class economy. This is because it is quite expensive and it can only be afforded by people who consider themselves as falling under the category of first-class. The sales of this Lexus brand are however minimized by the stiff competition from the German machines like the Mercedes Benz and the BMW. The majority of the sales of the Alfuttaim motors are the Toyota. This is because these types of vehicles are affordable to the middle-class in the economy. It is also notable that the middle-class makes up the largest percentage of the people in the world. It is also the biggest sale as it is accompanied by a wide variety of material handling equipment from the same manufacturer which is equally affordable to the middle-class. This has made Alfuttaim motors to be a significant exporter of cars in the developing nations as that is where most of the middle-class people reside. The target market of the Alfuttaim Motors is spread throughout the world. This is mainly due to its ability to cater for the vehicle needs of all the people whether they are low income earners or the high income earners. Its ability to offer a wide variety of motor vehicles also places it at a better position to capture a wide market base in the world. It is acknowledged that the Alfuttaim motors makes affordable vehicle brands for the low income earners so as to provide them with a rudimentary means of transport (Nayak & Josh, 2012). It also makes luxurious cars, for example the Lexus, for its clientele who want sophistication and class. The business people are equally provided for as there is adequate manufacture of trucks for business purposes. Product Concept of Alfuttaim Motors The product concept of Alfuttaim Motors is to offer the most long-lasting and dependable cars which feature the paramount safety expertise (Alfuttaim Motors LLC, 2015). All this is geared towards a safer society. The other product concept is the capturing of a wide market base globally. This is the reasoning behind the wide variety of vehicles that it produces. Through this product concept has seen the Alfuttaim Motors undertake initiatives individually as well as in collaboration with the government of the UAE and other stakeholders in order to achieve the underlying concept. One such initiative is the campaign against counterfeit practices in the motor industry. This has been done through training programs and seminars for customs officials so as to enable them to discern between the genuine and counterfeit parts of car that are sold in the world. This strategy’s objective is to ensure that the cars sold as well as their spare parts are safe for the intended users. This is in line with its product concept of manufacturing cars characterized by the highest standards of safety expertise. The other initiative that has stemmed from its product concept is the organization of programs for off-road safety. This is aimed at increasing the awareness of the users of the vehicles on how to safely drive on dessert terrains as well as on off-roads. There are also other training programs that are taken by other people such as the police that do not necessarily concern the cars themselves. The trainings would be directed to even the road users so as to increase the safety measures in the society as regards the use of motor vehicles. Alfuttaim’s Product Concept and its Customer Needs/Competitive Offerings In order to cater for the needs of its customers as well as to shield itself from external competition, the Alfuttaim Motors has appropriately positioned its product concept. It produces a wide variety of vehicles that differ in terms of appearance, speed and capacity. The company has manufactured high-speed cars designed for the younger generation who are a bit more adventurous as compared to the old generation. These cars for the younger generation would also be having a capacity for two people and small in size. This would be for luxury purposes as well. Likewise, there are cars designed for the people considered to be of the old generation. These cars would have a higher capacity so as to fit the needs of a family. Whether the cars are meant for the younger or the older generation, they all maintain the standards of safety and quality manifested by the product concept of the Alfuttaim Motors. The cars manufactured by this companied also vary depending on the terrain in which they are intended to be used on. This would be a rough or smooth terrain. In order to sustain the competitive offerings from its competitors, Alfuttaim Motors has made improvements in the design of its vehicles. This is more especially targeted for the American market who have in the past made numerous complaints that the cars manufactured by Alfuttaim Motors do not have the highest standards of quality as those manufactured by either Ford or General Motors. As a reaction to these American complaints, it launched a new and sophisticated model of the V8 pickup. Design improvements were also made to the Primus which was its hybrid model (Blitterswijk & Karadzhov, 2009). With these design improvements, it is able to obtain customer credibility and compete favorably with its competitors. Level of Customer Satisfaction and Marketing Mix Alfuttaim Motors’ levels of customer satisfaction is quite high in the developing nations. This is because it is able to manufacture vehicles that are easily affordable by the middle-class in the society. However, in the developed nations, its customer satisfaction is quite low. This is more especially in the American society who considers the Toyota brands to be of a less quality. This has seen most of its customers in the developing nations opt for other brands that they consider to be of superior quality. The marketing mix of Alfuttaim motors is comprised of four main strategies. These are price, product, location and promotion strategies. Under the product strategy, the company has doubled its manufacture of sales in order to capture the wide and ever growing market. Under the price strategy, the company employs the use of price differentiation. This helps it to set distinct the prices of its automobiles as compared to those of the other manufacturers. This is quite helpful as the customers are made to believe that they can buy superior quality vehicles at a cheaper price as compared to the other superior quality vehicles that cost a fortune. Under the location strategy, the Alfuttaim motors as strategically placed itself in many parts of the world. This puts it at a better position to capture a wide customer base. Lastly under the promotion strategy, Alfuttaim uses a pricing mechanism in which it puts its products at a cheaper cost as compared to those of its competitors. Recommendations on the Strategies of Alfuttaim Motors In order for Alfuttaim to continually improve its profitability, it will have to consider a few factors as regards to its marketing mix, segmentation, targeting as well as positioning. First and foremost, it needs to explore other markets that it has not explored in the past. This is for example China and Europe. The huge population capacity in China would afford it a huge customer base and hence help it to improve its profitability. Tis will also help it to effectively counter the competition that it faces from Ford and the General Motors. The company also needs to train its employees and hire highly qualified individuals who will manufacture quality vehicles. They will also improve on their innovation abilities and come up with highly sophisticated vehicles. This will make it to capture the American markets who are overly concerned about the quality and sophistication of the motor vehicles. Comparative Analysis between Alfuttaim Motors and Tata Motors The Tata Motors are the leading manufacturer of vehicles in India. It has a market base of 64% (Blitterswijk & Karadzhov, 2009). This is strength as well as a weakness. Tata Motors has only concentrated in the Indian market and it has not made any efforts to venture into the global market. This is unlike Alfuttaim Motors that has ventures globally. This means that its market base is quite low. The returns that Tata Motors gets from its investments are equally low. This has hindered its expansion as the company does not have enough capital to expand. References Alfuttaim Motors Company LLC, (2015). About Alfuttaim Motors. Retrieved from http://www.Alfuttaimmotors.ae/about.html Blitterswijk, M.V. & Karadzhov, R. (2009). Financial and Strategic Analysis of Ford Motor Company and Tata Motors. Retrieved from http://studenttheses.cbs.dk/bitstream/handle/10417/708/miel_van_blitterswijk_og_rosen_karadzhov.pdf?sequence=1 Nayak, S. & Josh, H.G. (2012). A study of the benefits and challenges of workplace diversity at Alfuttaim Motors, Dubai, UAE. World Academy of Informatics and Management Sciences, Volume 1, issue 4. Read More