ACKNOWLEDGEMENT

I would like to thank Toyota Motors Corporation, for constant

guidance to conduct the present arduous project and untiring

cooperation which he extended to me throughout the duration of

my summer training.

I am thankful to Mr. Philips for allowing me to do summer

training and for this constructive intervention and

encouragement.

My special thanks are for those who spared time for providing

information and responding to the questionnaire.

LIJO PHILIPS

5TH SEMESTER

TABLE OF CONTENTS

CHAPTER 1: - INTRODUCTION

EXECUTIVE SUMMARY OBJECTIVE OF STUDY SCOPE OF STUDY

CHAPTER 2: - COMPANY PROFILE CAR MODELS OVERVIEW CORPORATE DATA GUIDING PRINCIPLES PERCEPTS BOARD OF DIRECTORS LOCATION MANUFACTURING SUBSIDIARIES & AFFILIATES GROWTH MARKET SHARE COMPETITORS

CHAPTER 3: - MARKETING STRATEGIES PRODUCTS PRICE CUSTOMER SATISFACTION

CHAPTER 4: - RESEARCH METHODOLOGY TYPE OF DATA

SAMPLE SIZE AND AREAS COVERED STATISTICAL AND PRESENTATION TOOLS USED LIMITATIONS OF STUDY

CHAPTER 5: - CONCLUSION & RECOMMENDATIONS

CHAPTER 7: - ANNEXURE BIBLIOGRAPHY

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Introduction

Automobile, self-propelled vehicle used primarily on public roads but adaptable to other surfaces. Automobiles changed the world during the 20th century, particularly in the United States and other industrialized nations. From the growth of suburbs to the development of elaborate road and highway systems, the so-called horseless carriage has forever altered the modern landscape. The manufacture, sale, and servicing of automobiles have become key elements of industrial economies. But along with greater mobility and job creation, the automobile has brought noise and air pollution, and automobile accidents rank among the leading causes of death and injury throughout the world. But for better or worse, the 1900s can be called the Age of the Automobile and cars will no doubt continue to shape our culture and economy well into the 21st century.

Automobiles are classified by size, style, number of doors, and intended use. The typical automobile, also called a car, auto, motorcar, and passenger car, has four wheels and can carry up to six people, including a driver. Larger vehicles designed to carry more passengers are called vans, minivans, omnibuses, or buses. Those used to carry cargo are called pickups or trucks, depending on their size and design. Minivans are van-style vehicles built on a passenger car frame that can usually carry up to eight passengers. Sport-utility vehicles, also known as SUVs, are more rugged than passenger cars and are designed for driving in mud or snow.

Auto manufacturing plants in 40 countries produced a total of 63.9 million vehicles, including 42.8 million passenger cars, in 2004, according to Ward’s Auto, an auto industry analyst. About 16.2 million vehicles, including 6.3 million passenger cars, were produced in North America in 2004. For information on the business of making cars, see Automobile Industry.

The automobile is built around an engine. Various systems supply the engine with fuel, cool it during operation, lubricate its moving parts, and remove exhaust gases it creates. The engine produces mechanical power that is transmitted to the automobile’s wheels through a drive train, which includes a transmission, one or more drive shafts, a differential gear, and

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axles. Suspension systems, which include springs and shock absorbers, cushion the ride and help protect the vehicle from being damaged by bumps, heavy loads, and other stresses. Wheels and tires support the vehicle on the roadway and, when rotated by powered axles, propel the vehicle forward or backward. Steering and braking systems provide control over direction and speed. An electrical system starts and operates the engine, monitors and controls many aspects of the vehicle’s operation, and powers such components as headlights and radios. Safety features such as bumpers, air bags, and seat belts help protect occupants in an accident.

Gasoline internal-combustion engines power most automobiles, but some engines use diesel fuel, electricity, natural gas, solar energy, or fuels derived from methanol (wood alcohol) and ethanol (grain alcohol).

Most gasoline engines work in the following way: Turning the ignition key operates a switch that sends electricity from a battery to a starter motor. The starter motor turns a disk known as a flywheel, which in turn causes the engine’s crankshaft to revolve. The rotating crankshaft causes pistons, which are solid cylinders that fit snugly inside the engine’s hollow cylinders, to move up and down. Fuel-injection systems or, in older cars, a carburetor deliver fuel vapor from the gas tank to the engine cylinders.

The pistons compress the vapor inside the cylinders. An electric current flows through a spark plug to ignite the vapor. The fuel mixture explodes, or combusts, creating hot expanding gases that push the pistons down the cylinders and cause the crankshaft to rotate. The crankshaft is now rotating via the up-and-down motion of the pistons, permitting the starter motor to disengage from the flywheel.

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Engine

The basic components of an internal-combustion engine are the engine block, cylinder head, cylinders, pistons, valves, crankshaft, and camshaft. The lower part of the engine, called the engine block, houses the cylinders, pistons, and crankshaft. The components of other engine systems bolt or attach to the engine block. The block is manufactured with internal passageways for lubricants and coolant. Engine blocks are made of cast iron or aluminum alloy and formed with a set of round cylinders.

The upper part of the engine is the cylinder head. Bolted to the top of the block, it seals the tops of the cylinders. Pistons compress air and fuel against the cylinder head prior to ignition. The top of the piston forms the floor of the combustion chamber. A rod connects the bottom of the piston to the crankshaft. Lubricated bearings enable both ends of the connecting rod to pivot, transferring the piston’s vertical motion into the crankshaft’s rotational force, or torque. The pistons’ motion rotates the crankshaft at speeds ranging from about 600 to thousands of revolutions per minute (rpm), depending on how much fuel is delivered to the cylinders.

Fuel vapor enters and exhaust gases leave the combustion chamber through openings in the cylinder head controlled by valves. The typical engine valve is a metal shaft with a disk at one end fitted to block the opening. The other end of the shaft is mechanically linked to a camshaft, a round rod with odd-shaped lobes located inside the engine block or in the cylinder head. Inlet valves open to allow fuel to enter the combustion chambers. Outlet valves open to let exhaust gases out.

A gear wheel, belt, or chain links the camshaft to the crankshaft. When the crankshaft forces the camshaft to turn, lobes on the camshaft cause valves to open and close at precise moments in the engine’s cycle. When fuel vapor ignites, the intake and outlet valves close tightly to direct the force of the explosion downward on the piston.

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Engine Types

The blocks in most internal-combustion engines are in-line designs or V designs. In-line designs are arranged so that the cylinders stand upright in a single line over the crankshaft. In a V design, two rows of cylinders are set at an angle to form a V. At the bottom of the V is the crankshaft. In-line configurations of six or eight cylinders require long engine compartments found more often in trucks than in cars. The V design allows the same number of cylinders to fit into a shorter, although wider, space. Another engine design that fits into shorter, shallower spaces is a horizontally opposed, or flat, arrangement in which the crankshaft lies between two rows of cylinders.

Engines become more powerful, and use more fuel, as the size and number of cylinders increase. Most modern vehicles in the United States have 4-, 6-, or 8-cylinder engines, but car engines have been designed with 1, 2, 3, 5, 12, and more cylinders.

Diesel engines, common in large trucks or buses, are similar to gasoline internal-combustion engines, but they have a different ignition system. Diesels compress air inside the cylinders with greater force than a gasoline engine does, producing temperatures hot enough to ignite the diesel fuel on contact. Some cars have rotary engines, also known as Wankel engines, which have one or more elliptical chambers in which triangular-shaped rotors, instead of pistons, rotate.

Electric motors have been used to power automobiles since the late 1800s. Electric power supplied by batteries runs the motor, which rotates a driveshaft, the shaft that transmits engine power to the axles. Commercial electric car models for specialized purposes were available in the 1980s. General Motors Corporation introduced a mass-production all-electric car in the mid-1990s.

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Automobiles that combine two or more types of engines are called hybrids. A typical hybrid is an electric motor with batteries that are recharged by a generator run by a small gas- or diesel-powered engine. These hybrids are known as hybrid electric vehicles (HEVs). By relying more on electricity and less on fuel combustion, HEVs have higher fuel efficiency and emit fewer pollutants. Several automakers have experimented with hybrids.

In 1997 Toyota Motor Corporation became the first to mass-produce a hybrid vehicle, the Prius. It became available in Japan in 1997 and in North America in 2000. The first hybrid available for sale in North America, the Honda Insight, was offered by Honda Motor Co., Ltd., in 1999. Honda later introduced a hybrid version of the Honda Civic. In August 2004 the Ford Motor Company became the first U.S. automaker to release a hybrid vehicle when it began production of the Ford Escape Hybrid, the first hybrid sport- utility vehicle (SUV). The Escape Hybrid was released for the 2005 model year.

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Objective of the study The object of report is not only to focus on competitors but also to

get the competitive position in the national as well as international market through customer satisfaction. These are as follows.

To discover and translate the needs and desire of customer into products and services so as to create the demand of the product (through planning and producing planned product).

To serve the customer through channel of distribution. To face the keen competition. To know about the marketing strategies used by Toyota. To know about the marketing strategies of the competitors of Toyota. To find out the market share of Toyota. To know where Toyota stands as far as the BCG –matrix models

concerned.

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SCOPE OF THE STUDYThese are some of the scope of the study :1. The present study can be extended to access the present marketing condition of Indianautomobile sector.2. The study can be used to design a proper product, price, place and promotionalstrategy for the market.3. From the present study we can know the market share of different products andaccordingly formulated strategy to enhance it.4. The result of marketing success can be interpreted to assess the rate of employeesatisfaction in various departments.5. This study can be applied to find out an effective distribution channel to enhance thesale of various products of Toyota motors.

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EXECUTIVE SUMMARYThe story of Toyota Motor Corporation began in September 1933 when Toyoda Automatic Loom created a new division devoted to the production of automobiles under the direction of the founder's son, Kiichiro Toyoda. Soon thereafter, the division produced its first Type A Engine in 1934, which was used in the first Model A1 passenger car in May 1935 and the G1 truck in August 1935. Production of the Model AA passenger car started in 1936.

Although the Toyota Group is most well known today for its cars, it is still in the textile business and still makes automatic looms (fully computerized, of course), and electric sewing machines which are available worldwide.

Toyota Motor Co. was established as an independent company in 1937. Although the founding family name is Toyoda, the company name was changed to:

Signify the separation of the founders' work life from home life;

Simplify the pronunciation, and

Give the company an auspicious beginning. Toyota is considered luckier than Toyoda in Japan, where eight is regarded as a lucky number, and eight is the number of strokes it takes to write Toyota in Katakana.

During the Pacific War the company was dedicated to truck production for the Imperial Army. Because of severe shortages in Japan, military trucks were kept as simple as possible. For example, the trucks had only one headlight on the center of the hood.

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Commercial passenger car production started in 1947 with the model SA. In 1950 a separate sales company Toyota Motor Sales Co. was established (which lasted until July 1982). In April 1956 the Toyopet dealer chain was established. 

Replica of the Toyota Model AA, the first production model of Toyota in

1936

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COMPANY PROFILE

 The Headquarters of Toyota in Toyota City, Japan

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ASSEMBLY PLANTS OVER THE WORLD

Toyota has factories all over the world, manufacturing or assembling vehicles for local markets, including its most popular model, the Corolla. Toyota has manufacturing or assembly plants in the United States, Australia, Canada, Indonesia, Poland, South Africa, Turkey, the United Kingdom, France, Brazil, and more recently India, Argentina and Czech Republic. Toyota also builds and sells cars in China in a joint venture with Tianjin Xiali. Toyota New Zealand assembled vehicles until 1998, when it switched to importing cars from Japan and Australia. Cars from these plants are often exported to other countries.

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Toyota Car Models:

Innova

Camry

Avalon

Matrix

Corolla

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Prius    

Trucks:

Tacoma

Tundra 

Vans:

4runner

Land cruiser

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Overview

In 2006, Toyota was engaged in a variety of projects designed to solidify its foundations while continuing to grow.

On the product front, Lexus launched its new flagship model, the LS, and the new global Camry went on sale. In Japan, a new Corolla range was introduced, emphasizing the importance of this best-selling car.

In manufacturing, several new projects were started around the world. In May, manufacture of the Camry began in Guangzhou, China, while in the United States, the Kentucky plant, which inOctober celebrated 20 years of production, started manufacturing the first Toyota hybrid vehicle to be made in North America, the Camry Hybrid. In November, the Texas plant began producing the new Tundra truck, a key vehicle in Toyota’s North American lineup. In Japan, Toyota Motor Kyushu, Inc. began full-scale operations at its engine factory, while Toyota Motor Tohoku Co., Ltd. increased its manufacturing capacity.

In human resources development, following the establishment of the Asia Pacific Global Production Center in Thailand in August 2005, Toyota established the North American Production Center in the U.S. in February, and the European Global Production Center in the United Kingdom in March. Established as branches of the Global Production Center in Japan, these were created to spread Toyota’s manufacturing knowledge and skills throughout the world in pace with the rapid growth of Toyota’s overseas manufacturing. The centers educate trainers for local manufacturing plants in all regions, with trainees passing on what they learn to team members on their return to their plants.

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In R&D, Toyota focused its efforts on three key areas: environment, safety and energy. It made a special effort in the area of the environment by expanding its lineup of hybrid vehicles, and has worked on R&D relating to plug-in hybrid. In addition, as part of Toyota’s efforts to respond to the diversification of energy, in 2007 Toyota plans to introduce a flex fuel vehicle* in the Brazilian market that will run on 100% bio-ethanol fuel. From this point on, based on the philosophy of providing “the right car, in the right place, at the right time,” and in accordance with the infrastructure and customer needs of each region, Toyota will continue to promote efforts to develop environmentally friendly technology and vehicles.

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Corporate Data

Since its foundation, Toyota has conducted business with “contributing to the development of a prosperous society through the manufacture of automobiles” as a guiding principle. When I became president two years ago, I called on all employees to work with me in returning to our origins and asking earnestly whether Toyota is truly contributing to society and whether we are doing everything we should be doing. On the occasion of Toyota’s 70th anniversary, we will reinforce our measures designed to return to our core principle, which is to "repay the earth and society through technological innovation (and contribute to enhancing the quality of life everywhere

Guiding Principles

Honor the language and spirit of the law of every nation and undertake open and fair

Company Name

Toyota Motor Corporation

Head Office 1 Toyota-Cho, Toyota City, Aichi Prefecture 471-8571, JapanPhone: (0565)28-2121

Tokyo Head Office

1-4-18 Koraku, Bunkyo-ku, Tokyo 112-8701, JapanPhone: (03)3817-7111

Nagoya Office 4-7-1 Meieki, Nakamura-ku, Nagoya City, Aichi Prefecture 450-8711, JapanPhone: (052)552-2111

Establishment August 28, 1937

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corporate activities to be a good corporate citizen of the world. Respect the culture and customs of every nation and contribute to economic and

social development through corporate activities in the communities. Dedicate ourselves to providing clean and safe products and to enhancing the quality

of life everywhere through all our activities. Create and develop advanced technologies and provide outstanding products and

services that fulfill the needs of customers worldwide. Foster a corporate culture that enhances individual creativity and teamwork value,

while honoring mutual trust and respect between labor and management. Pursue growth in harmony with the global community through innovative

management. Work with business partners in research and creation to achieve stable, long-term

growth and mutual benefits, while keeping ourselves open to new partnerships.

Toyota Percepts

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Be contributive to the development and welfare of the country by working together, regardless of position, in faithfully fulfilling your duties.

Be at the vanguard of the times through endless creativity, inquisitiveness and pursuit of improvement.

Be practical and avoid frivolity.

Be kind and generous; strive to create a warm, homelike atmosphere.

Be reverent, and show gratitude for things great and small in thought and deed.

Board of Directors

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Chairman and Representative Director

 Fujio Cho

Vice Chairman and Representative Director

 Katsuhiro Nakagawa

President and Representative Director

 Katsuaki Watanabe

Executive Vice President and Representative Director

 Tokuichi Uranishi

 Kazuo Okamoto

 Kyoji Sasazu

 Mitsuo Kinoshita

 Takeshi Uchiyamada

 Masatami Takimoto

 Akio Toyoda

Senior Managing Director  Yukitoshi Funo

 Takeshi Suzuki

 Atsushi Niimi

 Hiroshi Takada

 Teiji Tachibana

 Shinichi Sasaki

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 Akira Okabe

 Yoichiro Ichimaru

 Shoji Ikawa

 Koichi Ina

 Takeshi Yoshida

 Shinzo Kobuki

 Akira Sasaki

 Hiroshi Kawakami

 Tadashi Arashima

 Mamoru Furuhashi

 Satoshi Ozawa

Honorary Chairman  Shoichiro Toyoda Senior Advisor  Hiroshi Okuda

Locations of Toyota Facilities

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Toyota Manufacturing Subsidiaries and Affiliates

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Main productsStart of

operations

Toyota Motor Kyushu, Inc.Harrier, Harrier Hybrid, Kluger, Kluger Hybrid, IS, ES

Toyota Motor Hokkaido, Inc.

Transmissions, transfers, aluminum wheels, drivetrain parts, etc.

Toyota Motor Tohoku Co., Ltd.

Mechanical and electronic parts

Toyota Auto Body Co.,Ltd.

Hiace, Liteace, Voxy, Noah, Estima, Prius, Land Cruiser, Alphard, Ipsum, Townace, Regiusace, Coaster, Estima Hybrid, Alphard Hybrid, LX470

Kanto Auto Works, Ltd.

Century, Crown, Corolla Spacio, Corolla Fielder, Isis, Belta, SC, Auris, BLADE

Central Motor Co., Ltd.Raum, MR-S, Scion xB, Corolla Axio, Corolla hatchbacks

Gifu Auto Body Industry Co., Ltd.

Hiace

Daihatsu Motor,Co., Ltd.Rush, Passo, Probox, Succeed, bB, Porte, SIENTA

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Toyota Today

Supporting Spirit of Athletics

Toyota continued its support of the ideals and spirit embodied in athletics by becoming, for the third time since 2003, the Official Partner to the 11th IAAF World Championships in Athletics, held in Osaka, Japan, August 25th-September 2nd. Through the sponsorship and a global advertising campaign with the tagline,"Beyond Limits," Toyota aims to communicate its support for athletes who, like Toyota, continually push themselves further in pursuit of the ultimate goal.Apart from providing a fleet of 220 cars for use as official vehicles at this year's championships,Toyota also supported a program to encourage new world records for women's events by becoming the official women's bib sponsor.

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Toyota’s First FFV

Toyota do Brasil LTDA. (TDB) launched Toyota's first-ever flex fuel vehicle (FFV), a vehicle which runs on gasoline, ethanol or any combination of the two, at a line-off ceremony at its Indaiatuba Plant in São Paulo on May 29th. Representing Toyota's commitment to developing environmental technologies, the locally produced Corolla Flex and Corolla Fielder Flex are the first marketed Toyota models that can run on 100% bioethanol. The introduction of the two models in Brazil, where bioethanol is widely used as fuel and FFVs represent 83% of newly registered vehicles in the market, firmly demonstrates Toyota's belief in listening to its customers. In the first semester of the year, Toyota accounted for almost 33,000 of the more than one million vehicles sold in Brazil during that period.

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Island AdventureMembers of the Philippine motoring press had a wet and wild time at the Toyota Road Trek 3, held May 31st-June 3rd in the archipelago's central islands. Bringing media representatives to a variety of well-known destinations across the country, the annual road trip is conducted by Toyota Motor Philippines Corp. to demonstrate the toughness and versatility of its IMVs. This year, the event took over 40 participants on an island-hopping adventure, enabling them to fully test the exceptional capabilities of the Innova, Fortuner and Hilux vehicles.A series of competitive, water-related activities made it a truly challenging and fun trip that encouraged teamwork, camaraderie and friendship among all attendees. The event was prominently featured in major newspapers and magazines, further boosting the popularity of IMVs in the market.

A Way to Learn Road SafetyDedicated to promoting activities that help minimize traffic accidents in Pakistan, Indus Motor Company Limited (IMC) in January launched a Toyota School Road Safety Program. Through music concerts, skits by clowns and quizzes in schools, the pilot program aims to educate children about road safety in a fun and memorable way. Twenty schools in Karachi and around 18,000 children have already benefited from the program, which is part of IMC's comprehensive corporate social responsibility initiative with the slogan, "Concern Beyond Cars." IMC looks to expand the program to other schools in Karachi and later to other cities, given the

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overwhelming response from the children and parents who have so far participated.

Crown Bamboo ConcertAs part of its 2007 campaign for the Crown with the theme, "Playing out your life with intelligence," FAW Toyota Motor Sales Co., Ltd. held its Crown Bamboo Concert at the famous Anji bamboo forest in Zhejiang province, China, on August 18th. The classical music concert successfully communicated the flagship model's philosophy of harmony to the guests present, and was extensively featured in various media across China.

Dreaming about FutureToyota Motor Corporation got a glimpse of the future through the eyes of children across Asia and China when it held the Dream Car Art Contest from October to January. Giving school students aged 15 years and younger the exciting challenge of drawing their ideal car, the annual contest generated greater awareness of the Toyota brand in the region. By means of a website, ads in Reader's Digest magazine and promotions at local dealerships, Toyota successfully raised public consciousness about the contest, drawing over 20,000 entries from 12 countries - an eightfold increase from the number of designs submitted at the first contest in 2004.

Toyota Turns 40Toyota AG (TAG), Toyota's distributor in Switzerland, celebrates its 40th anniversary with year-long promotions and a series of activities for its customers and partners. Kicking off its commemorative year with an elaborate Auris media launch on February 16th, TAG has since initiated a

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comprehensive advertising campaign that creates awareness of its special promotion packages for customers as well as Toyota's successful history in Switzerland. In March, a birthday gala dinner for 900 associates, dealers and partners served to thank everyone within the TAG Family for their support and encouragement throughout the distributor's four decades in the country.

Growth of Toyota  

Lasting growth for Toyota will depend on aligning our interests with the larger interests of customers and the community. We must be a company where people think seriously about the role and responsibility of their company in the world.  

Our economic and industrial contribution in each region grows, for example, as we globalize our operations. Another way to align our interests with the larger interests of the community is through technology.

 By the end of 1997, we will introduce the world's first new-energy transport that is commercially competitive with conventional automobiles. That is when we will put a hybrid-electric passenger car onto the market in Japan. Our hybrid-electric car will have a gasoline engine to generate electricity or provide supplementary power to the wheels. It is twice as fuel-efficient as conventionally powered vehicles of comparable size and performance. Equally important, the value of its potential fuel savings could prove greater than its cost premium over conventional vehicles. So, it actually could save money for car owners.

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 Survival and growth in our industry will hinge on developing technologies for reducing environmental impact of our products and operations, as well as improving vehicular safety. Photos and text on the following pages introduce some of the technologies we are developing to position Toyota as an environmental leader.

Priorities for Toyota in the growth Strategy

Fortifying our product line Asserting a competitive edge in technology Accelerating globalization Reclaiming market share in Japan Cultivating demand in new business sectors

Measures for asserting a competitive edge in technology have centered on environmental themes. We have introduced or demonstrated new power train technologies in the past year that will make Toyotas run cleaner and greener than ever. Those technologies include...

A direct-injection system that makes gasoline engines more efficient

Hybrid-electric systems that double fuel efficiency and reduce noxious emissions

Pure electric, "zero emission" vehicles that alleviate urban pollution

Fuel-cell systems that could transform the automobile in the 21st century.

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Market Share of ToyotaToyota Motor Corp. grabbed more U.S. retail market share than Ford Motor Co. in early November and it was less than one share point behind General Motors Corp.,Toyota, Japan's largest automaker, had a 15.4 percent U.S. retail market share a year earlier.Toyota plans to enter small car segment in IndiaWorld’s second largest automaker wants to get offensive in the Indian domestic auto market. Toyota is very much interested in launching a small car here in the segment currently dominated by Maruti Suzuki and Hyundai. Tata also has a decent presence in the market with their Indica range of diesel vehicles.  Toyota is at the moment carrying out a feasibility study for launching such a vehicle in the domestic market where it has models like the Innova and Camry amongst others. They have had an incredible success with their stopped Qualis model and are selling Toyota Innova in large numbers. T Ino, director (marketing), Toyota Kirloskar Motor Pvt Limited has expressed that the Indian auto market is a huge one and has the capacity to involve more players in the small car segment. Toyota has a variety of interesting models in its global lineup, which it can consider to launch in the Indian market. Some of these are Vios, Platz, and Passo. The company also expects to break even here in India this year with all the accumulated losses were expected to be wiped out during 2005. They also plan to invest around Rs 130 crores during the current year to enhance efficiency. Toyota plans to open up another manufacturing plant in India and is currently looking for a location, which suits its requirement.

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Competitors

Hyundai Motors India Limited (HMIL)

 

A decade after the Korean War and during the period of reconstruction, Hyundai Motor Company began its fledgling efforts at automobile manufacturing by entering into a technology transfer agreement with Ford of Great Britain, receiving design and styling from Ital Design of Italy, and assembling technology from both England and Japan, all of which made the production of our first model car, the "Pony," possible. In just ten years, in 1976 Hyundai began to export to the world market. In 1986, we entered the U.S. market establishing the Excel as a new contender among small cars and promoting the image of the Korean automobile industry.

 Upon expansion of our Ulsan plant, which enabled Hyundai Motor Company to have a large scale production base, and the founding of HM Canadian Corporation, which established Hyundai throughout North America, we produced a record 10 million cars and exported over 4 million, breaking records in a short span of time. No other automobile company can boast of these figures over such a short time span. We also poured our efforts in creating concept cars such as the HCD-I, followed by the HCD-II and III, electric cars, and high technology hybrid cars that will bear fruit in the future with their low pollution emissions, safety features, and environmentally-friendly recyclable components. From Pony to Equus, Hyundai Motor Company is committed to its growth as a mature company, constantly keeping in mind its customer-oriented mottoes: "Customer Satisfaction" and "Create Value for Customers."

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Marketing strategy of Hyundai

Products: 

Sonata Embera

Tucson

Getz 

Elantra

Terracan

Santro Xing

Accent

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The Price Strategy

In August 2004, a leading business newspaper reported that Hyundai Motors India Limited (HMIL), an Indian subsidiary of the South Korea- based Hyundai Motors Company (HMC) was expected to reduce the price of its flagship car - Santro - by as much as Rs 40,000. Industry experts were expecting a reduction in Santro's price in response to the price war being waged by the market leader in India - Maruti Udyog Limited (MUL), which had reduced the price of its largest selling car in the B segment - Alto - by Rs 58,000 in two price cuts starting from September 2003. This move had resulted in Alto replacing Santro as the largest selling car in the B segment in the period January to June 2004 (Refer Exhibit I for the market segmentation of the Indian car industry). 

Rebutting the report on price cuts, HMIL's managing director, BVR Subbu (Subbu) said, "We are not cutting prices on the Santro. We have allowed our competitors the prerogative of cutting prices." Several dealers of HMIL also felt that the company would not reduce Santro's price as it had not adopted such tactics earlier. 

Santro had been the most successful product of HMIL and was also the largest selling car in the B segment till the fiscal year 2003-04. Introduced in late 1998, Santro had emerged as the second largest selling car in India after MUL's M800 and had retained its position till March 2004 (Refer Exhibit II for the total units and value sales of the top eleven car models in India). In mid 2004, HMIL with its four models, Santro, Accent, Sonata and Elantra, was the second largest car company in India with 19% market share in the industry. The company was planning to launch another model, 'Getz', in September 2004.

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Competitive analysis

Strength of Hyundai

Volumes has been Hyundai's main strength, as can be seen with the rollout of its 2,00,000th car in 32 months from its Chennai plant. The company also returned a profit of Rs 67.61 crore in its very first year of operations in 2000.

Hyundai Motor India will not get into CBU (completely built unit) imports like the other car manufacturers, as the company wants to concentrate only on models that will fetch it high volumes hyundai have already announced that they would be importing CBUs for niche markets, either in the high-end bracket or in the sports car segment in limited editions.

Weakness of Hyundai

Hyundai's traditional weakness has been the chassis, which has never really matched the competition, especially European rivals, but the company claims this has been sorted out.

Brutal price cuts failed to prop up the Sonata's flagging sales, and worse, tarnished Hyundai's image, proving price isn't everything in the upper crust of the market

I have had numerous problems with the Hyundai dealerships also. When I complained directly to the maufacturer, their response was to offer me a Hyundai totebag or other promotional itme of my choosing. 

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 Brand Strategy 

Hyundai-Kia Automotive Group today announced the launch of its new global brand management strategy, in which Kia and Hyundai will pursue differentiated brand images as a means of boosting the Group’s overall market share and increasing the value of the two brands.

In accordance with the new strategy, Hyundai and Kia will be promoted under two separate brand slogans. The Hyundai slogan - "Drive your way" - is designed to communicate the company’s ‘refined and confident’ brand attributes, while the slogan - "The Power to Surprise" - is aimed at embodying the ‘exciting and enabling’ values of the Kia brand.    

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Maruti Udyog Limited (MUL)

It was established in Feb 1981 through an Act of Parliament, to meet the growing demand of a personal mode of transport caused by the lack of an efficient public transport system.

Suzuki Motor Company was chosen from seven prospective partners worldwide. This was due not only to their undisputed leadership in small cars but also to their commitment to actively bring to MUL contemporary technology and Japanese management practices (which had catapulted Japan over USA to the status of the top auto manufacturing country in the world).

A license and a Joint Venture agreement were signed between Govt of India and Suzuki Motor Company (now Suzuki Motor Corporation of Japan) in Oct 1982.  

 The objectives of MUL then were:

Modernization of the Indian Automobile Industry. Production of fuel-efficient vehicles to conserve scarce

resources. Production of large number of motor vehicles which was

necessary     for economic growth.

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Marketing strategy of Maruti:Products: 

Maruti 800

Maruti versa

Omni

Gypsy

Zen

Wagnor

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Esteem

Baleno

GrandVitara-xl7

Swift

Alto

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PRICE STRATEGY: - (RS.-LAKHS)

Maruti 800 2,00,850

Maruti versa 4,24,214

Omni 2,51,000

Zen 2,85,000

Wagnor 3,43,221-4,68,609

Esteem                                                       4,25,000- 5,09,000

Baleno 6,62,556

GrandVitara-xl7 17,31,400

 

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THE COMPETITION (Maruti)Since 1985, Maruti Udyog Limited (MUL) has been the market leader in the passenger car industry in India. Its flagship product - M800 had the distinction of being the largest selling car model in India since its launch in December 1983. Positioned as people's car, M800 ruled the Indian passenger car market and remained unchallenged ever since it occupied the top slot, five months after its introduction. In March 2003, MUL sold 20,687 units of M800, the highest ever sales by any single model in a month. It was also the highest sales since M800 debuted, surpassing its previous monthly high of 18,735 units in August 1999.  

For the first few months of 2004, M800 performed well, selling 15,301 units in January, 13,518 units in February and 15,540 in March. But gradually Alto, another MUL product, began eating into M800's share. Alto reported sales of 8,399 units, 8,324 and 9,011 units in January, February and March respectively. In April, its sales increased to 9,350 units and in May 2004, Alto took over M800's position as the largest selling car with sale of 10,373 units, slightly over M800's sales of 10,016 units. Analysts felt that Alto had taken the top spot because of its price reduction in September 2003 by Rs. 23,000 followed by the launch of the non-AC Alto for Rs. 0.23 mn in the first week of April 2004.  

On reducing the gap between its bread and butter model M800 and its compact car Alto, MUL said it had "long term" plans for M800. Commenting on Alto's pricing strategy, Jagdish Khattar (Khattar), managing director of MUL, said, "The new price positioning of the Alto would cannibalize existing A1 segment product the M800 which is also considered an old model. But, the cannibalization will remain within the Maruti family and the

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bigger numbers will help Maruti depreciate Alto faster. Net M800 sales may be less but we would be pushing more Alto and the more we sell the Alto the faster it will depreciate."

Though industry analysts said this move would boost MUL's profits, they also expressed their views that MUL's long-term plan might be to discontinue M800 and replace the entry segment with Alto. However, Khattar clarified that MUL's pricing strategy was not meant to replace M800 with Alto. He said, "Now, we have two cars in entry-level. Maruti 800 is still a dream of Indians, how can I replace it?" 

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Competitive Analysis

Strength  

In an era when owning a car was a distant dream for a vast majority of Indians, MUL rolled out its first car, the M800. The company labeled it a people's car, with a 796cc 3-cylinder engine that delivered 39.5bhp at an affordable price of Rs. 65,000. The first vehicle was released for sale in December 1983. Initially, the car was criticized for its diminutive size, but it proved to be spacious enough to carry four adults. Better technology and an affordable price due to a higher level of indigenization helped MUL achieve a dominant position in the Indian passenger car market  

Weakness  

MUL reduced the price difference between these two models positioning them on an almost equal platform, which resulted in confusion in the minds of consumers and industry analysts. 

Threat  

M800 had ruled the passenger car market as the only car in the entry-level segment in the Indian automobile industry and was now facing the danger of cannibalization from one of its own family members, Alto 

For the first few months of 2004, M800 performed well, selling 15,301 units in January, 13,518 units in February and 15,540 in March. But gradually Alto, another MUL product, began eating into M800's share. Alto reported

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sales of 8,399 units, 8,324 and 9,011 units in January, February and March respectively. In April, its sales increased to 9,350 units and in May 2004, Alto took over M800's position as the largest selling car with sale of 10,373 units, slightly over M800's sales of 10,016 units. Analysts felt that Alto had taken the top spot because of its price reduction in September 2003 by Rs. 23,000 followed by the launch of the non-AC Alto for Rs. 0.23 mn in the first week of April 2004. 

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Main Report Analysis

Marketing Strategies of Toyota

Products:

Avalon 

Camry 

Camry Salora 

Corolla

Matrix

Prius 

4runner

Highrunner

Land Cruiser

Sequoia

Sienna 

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Price:-

As far as pricing strategy of Toyota is concerned. They are focusing on the very segment of the market not only particular segment.  Basically they are focusing on official and business class people 

Product Line            

Avalon $26,625 $28,875 $31,075 $33,815

Camry $18,445(standard) $19,545(LE) $20,375(SE) $22,795(XLE)

Camry Salora $19,530 $21,025 $23,405 $26,942

Corolla $14,005 $15,050 $15,215 $17,780

Matrix $15,110 $16,590 $19,100   

Prius $21,725         

4runner $27,635      

Highrunner $34,625      

Land Cruiser $56,115      

Sequoia $32,820      

Sienna $23,625      

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Generic Strategies - Michael Porter

(1980)

Generic strategies were used initially in the early 1980s, and seem to be even more popular today. They outline the three main strategic options open to organization that wish to achieve a sustainable competitive advantage. Each of the three options are considered within the context of two aspects of the competitive environment:

Sources of competitive advantage - are the products differentiated in any way, or are they the lowest cost producer in an industry? Competitive scope of the market - does the company target a wide market, or does it focus on a very narrow, niche market?

The generic strategies are: 1. Cost leadership, 2. Differentiation, and 3. Focus.

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1. Cost Leadership

The low cost leader in any market gains competitive advantage from being able to many to produce at the lowest cost. Factories are built and maintained; labor is recruited and trained to deliver the lowest possible costs of production. 'cost advantage' is the focus. Costs are shaved off every element of the value chain. Products tend to be 'no frills.' However, low cost does not always lead to low price. Producers could price at competitive parity, exploiting the benefits of a bigger margin than competitors. Some organization, such as Toyota, are very good not only at producing high quality autos at a low price, but have the brand and marketing skills to use a premium pricing policy.

2. Differentiation

Differentiated goods and services satisfy the needs of customers through a sustainable competitive advantage. This allows companies to desensitize prices and focus on value that generates a comparatively higher price and a better margin. The benefits of differentiation require producers to segment markets in order to target goods and services at specific segments, generating a higher than average price. For example, Toyota differentiates its product and service. The differentiating organization will incur additional costs in creating their competitive advantage. These costs must be offset by the increase in revenue generated by sales. Costs must be recovered. There is also the chance that any differentiation could be copied by competitors. Therefore there is always an incentive to innovated and continuously improve.

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3. Focus or Niche strategy

The focus strategy is also known as a 'niche' strategy. Where an organization can afford neither a wide scope cost leadership nor a wide scope differentiation strategy, a niche strategy could be more suitable. Here an organization focuses effort and resources on a narrow, defined segment of a market. Competitive advantage is generated specifically for the niche. A niche strategy is often used by smaller firms. A company could use either a cost focus or a differentiation focus. With a cost focus a firm aims at being the lowest cost producer in that niche or segment. With a differentiation focus a firm creates competitive advantage through differentiation within the niche or segment. There are potentially problems with the niche approach. Small, specialist niches could disappear in the long term. Cost focus is unachievable with an industry depending upon economies of scale e.g. telecommunications.  

 

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Customer satisfactionToyota's believes in putting the customer first and aims to provide the best levels of customer satisfaction as its main marketing strategy. Their dealers have also worked hard to provide their high levels of customer support." 

"In the last one year, Toyota has taken many initiatives, which has made Innova the most successful product. Innova has successfully become a category creator. 

We will continue to meet the ever-challenging customer expectations and will come out with innovative marketing strategies. 

With a change of guard at Toyota Kirloskar Motor Ltd., the company has evolved a new strategy to capture 15 per cent market share in the Indian automotive segment. Effective from January 1, Atsushi Toyoshima has been appointed Managing Director of the company, replacing Sachio Yamazaki. "Competition is intense in the Indian market for domestic and foreign companies. The Indian market is important for Toyota with potential to aid its growth strategy," Yoshio Ishizaka, Executive Vice-President, Toyota Motor Corporation, said.

According to analysts, the Indian market would touch annual sales of 1.2 million units by 2005. Last year, Toyota sold 3.8 million units overseas, manufacturing six million vehicles at 56 plants in 25 countries. In India, the Toyota Quails notched sales of 25,000 units since its launch last year, he said. Toyota's strategy to corner a significant chunk of the Indian market involves "superior product offering and dedicated technology". In this context, the change of leadership in Toyota's Indian division is important, indicating a more important role for the company's manufacturing base in Bangalore.

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"Bangalore is an ideal location to meet all of Toyota's needs, including auto components," Mr. Toyoshima said

According to the managing director of Toyota Kirloskar Motor, Atsushi Toyoshima, the decision to introduce Innova here (India) was based on

three factors. First, over the last five years, the C- segment (between Rs 5 lakh to Rs 10 lakh) of the car market has grown by 20 per cent every year.

The multi utility vehicle segment has also grown at double-digit levels. Second, with an improving lifestyle and better roads, the Indian consumer

wants to take his vehicle for long drives with friends and family. Third, there is a latent desire of customers, including those owning MPVs, to seek

attributes like greater interior space and overloading ability, while passenger car buyers look for better styling and improved riding comfort.

Innova brings together the space and fuel economy of an MPV with the style, agility and power of a sedan. Toyota Kirloskar Motor has described it

as the first three-row seating passenger car in the Indian market.

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Research Methodology

Type of Data CollectedThis project depends upon the primary as well as secondary sources which are as follows. 

Primary Source:

Observation Experiment

Talking with distributors, retailers and so on

Secondary Source:

Balance sheet of the company Company website

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Sample Size & Areas Covered

A customer-based survey was conducted in which 100 people were asked to fill the questionnaire in which 50 people belong to cities of Delhi and GURGAON.

Because it was not possible to consider each and every person of those cities or of villages so, PROBABILITY SAMPLE or RANDOM SAMPLE was taken.

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Statistical and Presentation Tools Used

PRIMARY DATA is: First classified i.e. grouped qualitatively and quantitatively according

to the situation or the type of the data which was collected. After classifying is represented in the form of tables i.e.

systematically arranged in columns and rows. Some of the data is also graphically represented in the form of PIE

DIAGRAM.

SECONDARY DATA is represented: In the form of tables. By the way of BAR GRAPHS and SUBDIVIDED BAR GRAPHS

(Graphical presentation).

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Limitations of the Study

Since the road to improvement is never ending, so this study also suffers from certain limitations. Some of them are as follows:

Because of illiteracy, it was a time consuming method in which continuous guidance was required.

Questionnaire method involves some uncertainty of response. Co-operation on the part of informants, in some cases, was difficult to presume.

It is possible that the information supplied by the informants may be incorrect. So, the study may lack accuracy.

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Findings The strong industry position of toyota is based upon a number of

factors including a diversified product range, highly targeted marketing and a commitment to lean manufacturing and quality.

The company(Toyota) uses marketing techniques to identify and satisfy customer needs. Its brand is a household name. The company also maximizes profit through efficient manufacturing approaches (e.g. Total Quality Management).

Toyota is to target the 'urban youth' market. The company has launched its new Aygo, which is targeted at the streetwise youth market and captures (or attempts to) the nature of dance and DJ culture in a very competitive segment.

Toyota's believes in putting the customer first and aims to provide the best levels of customer satisfaction as its main marketing strategy. Their dealers have also worked hard to provide their high levels of customer support."

Competition is intense in the Indian market for domestic and foreign companies. The Indian market is important for Toyota with potential to aid its growth strategy,

They have had an incredible success with their stopped Qualis model and are selling Toyota Innova in large numbers.

While Suzuki-Maruti, Tata Motors, Hyundai, Mahindra & Mahindra and Toyota command the top five positions in the domestic passenger vehicle segment, Honda, GM and Ford are fighting each other for the sixth position.

 

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SWOT Analysis Toyota

Strengths

New investment by Toyota in factories in the US and China saw 2005 profits rise, against the worldwide motor industry trend. Net profits rose 0.8% to 1.17 trillion yen ($11bn; £5.85bn), while sales were 7.3% higher at 18.55 trillion yen. Commentators argue that this is because the company has the right mix of products for the markets that it serves. This is an example of very focused segmentation, targeting and positioning in a number of countries.  

In 2003 Toyota knocked its rivals Ford into third spot, to become the World's second largest carmaker with 6.78 million units. The company is still behind rivals General Motors with 8.59 million units in the same period. Its strong industry position is based upon a number of factors including a diversified product range, highly targeted marketing and a commitment to lean manufacturing and quality. The company makes a large range of vehicles for both private customers and commercial organisations, from the small Yaris to large trucks. The company uses marketing techniques to identify and satisfy customer needs. Its brand is a household name. The company also maximizes profit through efficient manufacturing approaches (e.g. Total Quality Management).  

Weaknesses 

Being big has its own problems. The World market for cars is in a condition of over supply and so car manufacturers need to make sure that it is their

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models that consumers want. Toyota markets most of its products in the US and in Japan. Therefore it is exposed to fluctuating economic and political conditions those markets. Perhaps that is why the company is beginning to shift its attentions to the emerging Chinese market. Movements in exchange rates could see the already narrow margins in the car market being reduced.  

The company needs to keep producing cars in order to retain its operational efficiency. Car plants represent a huge investment in expensive fixed costs, as well as the high costs of training and retaining labour. So if the car market experiences a down turn, the company could see over capapacity. If on the other hand the car market experiences an upturn, then the company may miss out on potential sales due to under capacity i.e. it takes time to accommodate. This is a typical problem with high volume car manufacturing.

Opportunities

Lexus and Toyota now have a reputation for manufacturing environmentally friendly vehicles. Lexus has RX 400h hybrid, and Toyota has it Prius. Both are based upon advance technologies developed by the organization. Rocketing oil prices have seen sales of the new hybrid vehicles increase. Toyota has also sold on its technology to other motor manufacturers, for example Ford has bought into the technology for its new Explorer SUV Hybrid. Such moves can only firm up Toyota's interest and investment in hybrid R&D.  

Toyota is to target the 'urban youth' market. The company has launched its new Aygo, which is targeted at the streetwise youth market and captures (or attempts to) the nature of dance and DJ culture in a very competitive segment. The vehicle itself is a unique convertible, with models extending

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at their rear! The narrow segment is notorious for it narrow margins and difficulties for branding.  

Threats 

Product recalls are always a problem for vehicle manufacturers. In 2005 the company had to recall 880,00 sports utility vehicles and pick up trucks due to faulty front suspension systems. Toyota did not give details of how much the recall would cost. The majority of affected vehicles were sold in the US, while the rest were sold in Japan, Europe and Australia.  

As with any car manufacturer, Toyota faces tremendous competitive rivalry in the car market. Competition is increasing almost daily, with new entrants coming into the market from China, South Korea and new plants in Eastern Europe. The company is also exposed to any movement in the price of raw materials such as rubber, steel and fuel. The key economies in the Pacific, the US and Europe also experience slow downs. These economic factors are potential threats for Toyota .

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Competitive Analysis

Strength 

In an era when owning a car was a distant dream for a vast majority of Indians, MUL rolled out its first car, the M800. The company labeled it a people's car, with a 796cc 3-cylinder engine that delivered 39.5bhp at an affordable price of Rs. 65,000. The first vehicle was released for sale in December 1983. Initially, the car was criticized for its diminutive size, but it proved to be spacious enough to carry four adults. Better technology and an affordable price due to a higher level of indigenization helped MUL achieve a dominant position in the Indian passenger car market  

Weakness 

MUL reduced the price difference between these two models positioning them on an almost equal platform, which resulted in confusion in the minds of consumers and industry analysts. 

Threat 

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M800 had ruled the passenger car market as the only car in the entry-level segment in the Indian automobile industry and was now facing the danger of cannibalization from one of its own family members, Alto 

For the first few months of 2004, M800 performed well, selling 15,301 units in January, 13,518 units in February and 15,540 in March. But gradually Alto, another MUL product, began eating into M800's share. Alto reported sales of 8,399 units, 8,324 and 9,011 units in January, February and March respectively. In April, its sales increased to 9,350 units and in May 2004, Alto took over M800's position as the largest selling car with sale of 10,373 units, slightly over M800's sales of 10,016 units. Analysts felt that Alto had taken the top spot because of its price reduction in September 2003 by Rs. 23,000 followed by the launch of the non-AC Alto for Rs. 0.23 mn in the first week of April 2004. 

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Conclusion   While Suzuki-Maruti, Tata Motors, Hyundai, Mahindra & Mahindra and Toyota command the top five positions in the domestic passenger vehicle segment, Honda, GM and Ford are fighting each other for the sixth position. Incidentally, in the first five months of the fiscal (Apr-Aug ’04) Skoda has moved to the tenth position, overtaking Italian major Fiat. 

Maruti Udyog (MUL), which has been the market leader in the mini, compact and mid-size segments, retains its leadership position with sales of 1.9 lakh units, followed by Tata Motors with 70,022 units, Hyundai Motor India with 48,360 units, Mahindra with 28,530 units and Toyota with 19,797 units.

  Competitive pricing and a better value offerings were driving the sales of most auto majors for the past few months. Despite a competitive business environment, most of the car majors were able to hold on to their market shares in the April to August ’04 period. The exceptions were Hyundai, Mahindra & Mahindra, Hindustan Motors and Fiat, who saw their market shares fall marginally.

  The market is slow and there are visible signs of discounting, particularly in the higher end of the car segment. However, since entry level and compact cars are volume segments, the slowdown’s effect is more visible here.

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 For many automobile companies, it was a double whammy in August ’04. The truckers’ strike and adhikmas (inauspicious period) last month affected dispatches of most car companies, including Maruti Udyog, General Motors and Tata Motors, resulting in lower sales. The exceptions were Honda Siel Cars India, Ford India and Toyota Kirloskar.  

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Recommendation Toyota should adopt the defensive marketing strategy because as

being the second largest car producer in the international market,

Toyota must at the moment carry out a feasibility study for launching a vehicle in the domestic market where it has models like the Innova and Camry amongst others.

Toyota should conduct market survey in Indian market for quails in order to know the perception of Indian consumers.

Toyota should adopt an offensive marketing strategy for entering in the small car segment. This market is dominated by Maruti Suzuki and Hyundai in the Indian domestic auto market.

Toyota must plan out an ideal marketing producing capacity ,becaue it faces the problem of over and under capacity in case of upturn and downturn of the market.

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Annexure

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 BIBLIOGRAPHY:

Books referred: -

Marketing Management 30th editon - Philip Kotler Marketing Management 2005 - T. N. Chabra

Marketing Management 2006 - C. B. Gupta

Web Sites: -

Google search engine www.toyota private limited.com

www.yahoo.com

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