Toyota's strategy

Ok, I'm sitting in the business studies room with Lex in front of a HUUUUUGE screen (bigger than 5 Lexes) and doing a task that Mr. Chris gave as. We are supposed to create a possible strategy for Toyota as its sales are falling because of the current economics situation. Credit crunch, you know, we are all gonna die from hunger and low income, our children are not going to have a bright future and etc... awful picture. It's even worse than going to Torquay.

So, going back to Toyota topic.

Ok, sales are falling, what are they going to do? We dunno for sure, but me and Lex had a long discussion (15 seconds long) about possible ways of improving the situation and came up with some interesting points.

1. Get money from various sources of finance. They can borrow money from a bank, as many banks in different countries (for example, the UK) are trying to increase confidence by offering a big amount of loans. Even in England, the MPC has reduced interest rates to 1% recently. Or, as an alternative, sell shares or assets. By selling assets I mean selling some machinery in one branch of Toyota in Japan, for example.
2.There is a possibility of a merge. But I don't mean a vertical or a horisontal type of merging cuz it will cause the diseconomies of scale (the average cost will rise). I'm talking about lateral or diversifying types.
3. Postpone the introduction of new products such as electro-hybrid cars. They cost, on average, 3000-5000$ more than usual fuel-using cars. People dun have money anyway and oil prices are lower now, so people will not buy it. And Toyota will have to advertise this new type of cars as well to avoid information failure. If we look at Ansoff Matrix, it will be a new product in an already existing market:

Ok, finished for this week today.

1 comment:

lauwani said...

They are all possible but still have another ways:
1) Trade in
2) Reduce labour cost
eg: fewer hours