The main problem that the Mercedes - Benz would have faced if they had remained a niche player selling 'world cars' to the luxury market worldwide , would be the stiff threat of competitions from the Japanese automobile industry as they produced luxury cars of good quality at cheaper rates with added features. Another problem would be the decline automobile sector. They won't be able to earn more profits if they are marketing their products in only one segment. Question 2 What were the key approaches to Fords model of Globalization and Internationalization? The key Characteristics of Fords approach to Globalization • Introduced Assembly line leading to mass production which resulted in low cost production , high volume and rapidly expanded its markets • Set up Sales branch in France , further expanding its market to European countries.
It also relies on their brand names for attracting customers and maintaining customer loyalty. Mercedes is known by the market for producing safe cars which have the latest technology. Mercedes is also famous for manufacturing environmentally friendly cars. The motivation, product differentiation and the comparative advantage theories have explained the strategies and reasons for success for Mercedes. It is important for the automakers to embrace new market trends in order to ensure that it enjoy profitability in the long run.
GM stands poised to lead in these areas as it has devoted its research and development and production toward fuel efficiency and fuel alternatives. GM has plans to introduce its own autonomous vehicle by 2020. The company has been buying self-driving technology start-up companies to gain their technology and patents in order to gain the edge on the market of self-driving vehicles. Their OnStar product development has helped to lead the way in the development of autonomous driving
BMW in the past used differentiation strategy to build their car empire, but nowadays they are approaching low cost strategy; in contrast, Toyota used both strategies to establish a strong reputation in automotive industry. This results in impressive value to quality in the favor of Toyota. BMW is known for their high quality cars that cost them a lot to develop, but their cost is much higher than their competitors comparing to Toyota. In addition, Toyota strategy is to develop the best quality possible with the lowest cost to charge customers lower price than its rivals. According to
4.Rationales The financial revenues of Toyota are growing rapidly. It is hard for an automotive company to keep such a successful and sustainable growth in a competitive era. Not only its unique mission, five main principles and three goals, but also there are several distinctive strategies, such as business strategies, sustainable strategies that make the Toyota become the most successful automotive manufacture in the world. 4.1 Five main precepts These five “always” precepts are the basic guide tutorial rules in Toyota. They were firstly came up by the founder of Toyota, whose name is Sakichi Toyoda, which became the standard of behaviours of all Toyota staff.
According to Volkswagen (2016) the company uses a highly efficient global network to manage its supply chain. The company’s initiative of FAST (Future Automotive Supply Tracks) focuses on digitization; this is used to highlight investments and make efficient use of resources. The system allows suppliers to be involved in the innovation within the group and contribute ideas towards the development of vehicles at an earlier stage. The manufacturing or assembling is done by the combined efforts of robots and employees. The major parts of the operation are done by robots in an effort to reduce wastage, energy and time while the employees would do the quality checks.
Normally, companies do not want to cut their targeted return and they follow the strategy which is formulated in to the cost + profit = selling price. But Toyota takes a slightly different strategy which is formulated in to the price-cost=profit. Strategic management has a direct impact on its business in all organizations. That 's why Toyota has become leading company in auto industry because of the attractive strategic management policy. Now, Toyota plans to build training centers in different parts of the world, where they can easily train their new workers and managers how to design new cars and assemble them.
Toyota vision statement is to be the worldwide leader in the customer values . The mission statement is to become the leader in availing the best value in machines and support service for the customer. It's also committed to improve life quality .The name of this company has been connected with upper level of quality service and product . It's also a chief of Japans exporter ,with its services and product sales outside Japan. The strength of Toyota that is very strongly established in the major of countries .
1. Innovative culture Toyota is one of the most innovative auto companies and has a strong culture that is focused on constant innovation. The company was the first to introduce Kaizen, Kanban and Total quality Management systems widely in their organization. 2. Brand reputation The business is known for its environmentally friendly, safe and durable cars that are sold in more than 170 countries.And then Toyota’s brand is the most valued automotive brand in the world.
Toyota becomes more outstanding compared to its peers because of TPS. Strong Brand Recognition According to the BrandZ Top 100 Most Valuable Global Brand, Toyota is valued $29.5billion and it is the most valuable brand in the automobile industry. Leadership position of brand value ensures the consumer perception of confidence on the company future growth. It produces positive implications on consumer purchase behaviour directly. Toyota is a world leading company with a strong market position in different geographies across the world.