Since the
beginning of civilization, or even since man first came to think coherently, he
has needed a form of transportation. However, it was only recently that
transportation became completely essential to the survival of the human race,
as we started to want to live our lives faster and faster. We soon wanted to
move around quickly and efficiently, and this is where the billion dollar
vehicle industry came into the picture. Toyota Motor Corporation is a part of
the vehicle industry, and is based in Tokyo, Japan. The company has become one
of the largest organizations within the vehicle industry.
In 1933,
the Toyoda Automatic Loom Works formed the Toyota Motor Corporation, although
it was known as Toyoda Motor Corporation at the time. The organization was
merely a division of the larger organization, and was placed under the
leadership of Kiichiro Toyoda, who was part of the family that had founded the
company. However, the company did not remain part of Toyoda Automatic Loom
Works for long, and by 1937 was an established corporation by itself. In 1936,
the company decided that they needed to have their logo changed to accommodate
the new identity that they were creating for themselves (Toyota Motor Corporation , 2004) . The name Toyota was
originated, and came about to become an international symbol for perfectionism
in the automobile industry. The eight brush stroke that the word ‘Toyota’ was
written with in the Japanese language was thought to be lucky for the
organization at the time (Toyota Motor Corporation , 2013) . The three symbols
were also put together to create the logo for the organization.
Toyota was
not content to hold on to its operations in Japan. Its operations continued to
increase on its local market, but it decided to go into the overseas market to
capitalize on markets which were previously unexplored to their full capacity.
This is where they turned their attention to the United States of America (Kaisha, 1988) . They exported their
first car, the Toyota Crown, to the United States of America in 1957. This was
known as the Toyota Motor Sales Inc., with its headquarters in Hollywood,
California. Toyota did not start selling its vehicles until 1958, and even then
only sold up to 288 vehicles. This included Toyopet Crown vehicles along with a
single Land Cruiser. However, while the Toyopet was an honest effort, it was
not enough to go up against the other organizations in the market (Kaisha, 1988) . The product was
overpriced and underpowered, and could not rise in the American market.
However, the Land Cruiser did extremely well, and carried Toyota into the US
market. It was then that the Toyota Corona arrived in the US market in 1965. It
was designed for the American drivers in the country, and helped to triple the
profits of the company in the US.
However,
Toyota was still not content. It was important for the company to be flexible
in its operations. They were an automobile manufacturing country, and in order
to be competitive they needed to offer their products quickly and effectively
when demand increased. Toyota realized that it could not provide its products
to its customers by manufacturing it in Japan, and therefore started its first
overseas manufacturing plant. In 1962, it started to build vehicles for the
first time outside its country in Brazil (Kaisha, 1988) . The manufacturing plant was set up to
ensure that the customers in the United States of America received all the
products that they demanded, and Toyota maximized its profits.
It wasn’t
until 1982 that Toyota decided that it needed to maximize its operations
completely. It decided to combine the resources of the two aspects of its
operations – the Toyota Motor Co. Ltd and Toyota Motor Sales Co. Ltd. Both the
aspects of the organization focused on creating a local and international
presence which would establish Toyota as the most successful automobile
corporation in the world (Kaisha, 1988) . The United States of America was
quickly becoming one of the most important automobile markets in the world, and
Toyota decided that this was where it would gain the most. It decided to tap
into the unexplored potential of the US market by creating a joint venture with
General Motors, or as it was known then the New United Motor Manufacturing Inc.
It had previously been unable to meet the demands of the US market, even with
the automobile manufacturing plant in Brazil. Therefore, with the new
partnership it created a new manufacturing plant in the United States itself (Kaisha, 1988) . This manufacturing
plant would directly sell to the US markets, flooding the market with products
like the Toyota Corona and all other Toyota products which were reliable and
handy for the US markets. Of course, it was not until four years later that the
manufacturing plant actually began production, and the demand in the United
States had reached its peak at that point.
Up till
then, Toyota was the working class vehicle manufacturer. It mass produced
vehicles which appealed to the average American. Its products were reliable and
affordable, and attracted large numbers of customers throughout the country.
However, there was a largely unexplored market niche within the US markets, and
this was the luxury vehicle market niche. Toyota had not managed to manufacture
any product which appealed to the luxury market niche. In fact, it had not
appeared practical before that to enter the market because all of the major
vehicle manufacturers were facing trouble in the luxury vehicle producers.
However, it was then that Toyota introduced the Lexus Brand in 1989, and
explored the market that was slowly being abandoned by other vehicle
manufacturers (Kaisha, 1988) .
In 1992,
Toyota introduced the Toyota Motor Manufacturing in the United Kingdom. This
vehicle manufacturing plant was intended to spearhead the company’s venture
into the European market. It started production in the UK, and built on the
foundation of Toyota and Lexus brand’s success throughout other markets.
Toyota has
faced a number of problems since its inception. The founder of the company
proved to be an ineffective leader, and failed to create success for the
automobile company in the first few years. The unions that were part of the
Japanese economy at that point were swift to point out that it was Toyoda’s
neglect that had resulted in the layoffs of hundreds of workers, and therefore
called for his resignation. Once Toyoda had resigned, the company was taken
over by Taizo Ishida, who had previously proven his leadership as leader of the
Toyoda Automatic Loom Works. Taizo Ishida did not concern himself with the
present situation of the company. Instead, he set about focusing on creating a
future for the company. He did so by ensuring that Toyota invested on future
equipment that could manufacture high quality cars that would be accepted in
the automobile industry markets (Assembly Newspaper, 2007) . During the 1960s,
the company gained on other companies within the Japanese automobile market,
until it seemed as though even Nissan could not hold its own against Toyota (Assembly Newspaper, 2007) . This continued as
Toyota became the largest automobile corporation in the world in 2010 but the
problems during the economic recession combined with the defaults in their
products resulting in recalls turned the market against them.
Toyota is
an automobile manufacturer, which means that the company does not limit itself
to producing any specific type of automobile product. This includes production
of SUVs, Four Wheel Vehicles, Cars, Trucks and Buses. Famous brands like the
Lexus are part of the company’s arsenal of vehicles which are produced and
marketed around the world.
Through the
late 1990s, the effects of global warming were being felt throughout the world.
The temperatures in the world were increasing, and various climatic features
were changing. It was this that prompted Toyota to take action against its
effects. Global warming has affected Toyota similar to any other organization
in the automobile industry. Their image as an organization that places
incredible value on corporate social responsibility is reduced when consumers
realize how much their vehicles help destroy the environment indirectly by
consuming oil, natural gas and coal. In fact, a major part of the ozone layer
has been depleted because of how much carbon dioxide and carbon monoxide has
been given out by vehicles manufactured by Toyota in the last fifty years (Toyota Motor Corporation , 2013) . However, Toyota has
done its duty. It has provided consumers with a means of transportation, and
pushed itself to the limits of human advancement in technology to help the
environment. This is where it has come upon the Toyota Prius – the world’s
first mass produced hybrid vehicle. The vehicle was produced in the year 1997,
when the company decided that it had found a way to manufacture this product o
a large scale efficiently. The Toyota Prius is the most environmental friendly
vehicle in the world, and in 2008 the vehicle has sold up to 1 million units
throughout the world (Toyota Motor Corporation , 2013) . In a single year,
the company added a million more vehicles sold to its annual reports, which
show how much the organization is doing to stop the effect that global warming
is having on the planet earth.
During the
1980s, the company was manufacturing vehicles for consumers throughout the
world. In order to meet the demand for vehicles, and at the same time supply
the consumers with the same high quality vehicles they had always manufactured
the company decided to adopt the Just in Time Manufacturing system (Toyota Motor Corporation , 2013) . This became part of
The Toyota Way. The high demand that it faced from the various markets could
now be met because the company could afford to manufacture vehicles on large
scale. They could meet the demands of the public, and increased their market
share significantly because they were consistently providing high quality
products in the markets. The Just In Time Manufacturing System would keep the
inventory of the company in check throughout its operations. It keeps updating
its inventory to acknowledge every single sale that it makes (Liker, 2004) .
This provides it with feedback on which products it should manufacture and the
pace it should keep in order to meet the demands of the customers and maximize
its profits.
In the last
decade, Toyota’s profits and revenues have risen up and down. Of course, its
revenues are significantly higher than its revenues in the beginning of the 21st
century (Toyota Motor Corporation , 2013) . However, growth has
been slowed down by the misfortunes that Toyota faced along the way. Its focus
declined and the company lost sight of how its biggest strength had always been
the quality of its products rather than the quantity. Toyota had become the
largest automobile manufacturer in the world by providing customers with
reliable products which would perform according to the requirements of the
customers. But it encountered problems. In conclusion, it is important for
Toyota to fall back to becoming a consistently high performer rather than
providing the largest number of vehicles in the world.
Resources
Assembly Newspaper. (2007, February 6). The Creators
of Toyota's DNA. Assembly , p. n.d.
Kaisha, T. J. (1988). Toyota
: a history of the first 50-years. Toyota City: Toyota Motor Corporation.
Liker, J. K. (2004). The
Toyota way : 14 management principles from the world's greatest manufacturer.
New York: McGraw-Hill.
Toyota Motor
Corporation . (2013). History of Toyota. Tokyo: Toyota Motor
Corporation.
Toyota Motor
Corporation . (2004). Vision & Philosophy . Tokyo: Toyota Motor
Corporation.
