Toyota vs. Competitors: Financial and Strategic Analysis Report

This report provides a critical analysis of Toyota's market position compared to its competitors, focusing on financial performance and strategic analysis. The report examines key issues such as revenue, market share, and profit margins of Toyota, Hyundai, and Mazda. It includes a financial analysis comparing revenue generation, market share, and profit margins, supported by relevant figures and graphs. Strategic analysis is conducted using a modified Porter's Five Forces framework. Operational and organizational aspects are assessed using a balance scorecard approach for Toyota, Hyundai, and Mazda. The report highlights limitations of financial models and concludes with recommendations based on the analysis.

Contents
1. Introduction.........................................................................................................................3
1.1. Purpose:.......................................................................................................................3
1.2. Case Context of analysis:............................................................................................3
1.3. Company Background:................................................................................................3
2. Key issue(s):.......................................................................................................................3
3. Rational of choice of companies:........................................................................................3
4. Financial Analysis (comparison with competitors)............................................................3
4.1. Revenue analysis and forecast.....................................................................................3
4.2. Market share................................................................................................................6
4.3. Stats and depictions till now........................................................................................7
4.4. Profit margins..............................................................................................................8
4.4.1. Hyundai:...............................................................................................................9
5. Strategic analysis................................................................................................................9
5.1. Market and competitors analysis (Modified Porter’s five forces)...............................9
5.1.1. Threat of Entrant..................................................................................................9
5.1.2. Power of Buyer..................................................................................................10

5.1.3. Power of supplier...............................................................................................10
5.1.4. Competitive Rivalry...........................................................................................10
5.1.5. Threat of substitutes...........................................................................................10
6. Operations and organisation(s) analysis (Balance-score card).........................................11
6.1. TOYOTA...................................................................................................................11
6.1.1. Learning and Internal Growth................................................................................11
6.1.2. Process or Operations.........................................................................................11
6.1.3. Customer Perspective:........................................................................................12
6.1.4. Financial Perspective:........................................................................................12
6.2. HYUNDAI................................................................................................................12
6.2.1. Learning and Internal Growth............................................................................12
6.2.2. Process or Operations.........................................................................................12
6.2.3. Customer Perspective:........................................................................................12
6.2.4. Financial Perspective:........................................................................................12
6.3. MAZDA....................................................................................................................13
6.3.1. Learning and Internal Growth............................................................................13
6.3.2. Process or Operations.........................................................................................13
6.3.3. Customer Perspective:........................................................................................13

6.3.4. Financial Perspective:........................................................................................13
7. Limitations of Financial models in analysing performance..............................................13
8. Recommendation..............................................................................................................14
9. Conclusion........................................................................................................................14
References................................................................................................................................15
Table 1 (Balance score card)....................................................................................................10
Figure 1 (Toyota operating income)..........................................................................................4
Figure 2 (Hyundai revenue generation).....................................................................................4
Figure 3 (Mazda revenue generation)........................................................................................5
Figure 4 (Revenue stats).............................................................................................................6
Figure 5 (Market share)..............................................................................................................6
Figure 6 (Leading importer market share).................................................................................7
Figure 7 (Vehicles produced).....................................................................................................8
Figure 8 (Hyundai's profit margins)...........................................................................................9

Introduction
1.1. Purpose:
The main purpose of this report is to provide a critical analysis of the market state of Toyota as a comparison with their core
competitors. The report will basically focus on the core aspects of the market like revenue, market share. Profits, earning ratio etc. I
respect to the company targeted i.e. Toyota as compared to Competitors like Mazda, Hyundai.

1.2. Case Context of analysis:
The prime context for the analysis will be based on analysis of various financial and strategic factors associated with the company
and how they differ as compared to their competitors. The various factors will include the analysis on various KPIs like market
growth, debt level, cash factors, and profit or loss statistics.
1.3. Company Background:
Toyota Motor Corporation is a Japanese company for automobile manufacturing. The company is based in Toyota, Aichi, Japan and
currently holds a workforce of more than 350,000 employees (Yamamoto et al, 2016). As per the statistics are considered the
company was rated the most successful company in term of revenue collection. Even in the year 2012 the company was rated as the
most successful producer of automobiles (as far as numbers are concerned) (Lai, 2016). The company Toyota is not a small brand but
a name known by everyone. In the further sections of the report the focus will be on the key issues and various comparison with their
core competitors (Toyota, 2016).
2. Key issue(s):
This report will cover the basic or the key issues associated with the company and how these factors have affected the overall
performance of the company. These key issues will cover the financial as well as strategic issues of the company and how the company
stands today.
3. Rational of choice of companies:
Since attaining a good position in the market Toyota has become a big brand but in recent years they have received several setbacks
which has weakened their positioned whereas on the other hand its competitors like Hyundai and Mazda have grown as a names (Wada,
2015) (Subit et al, 2015). For these reasons these are the company targeted for competitive analysis of Toyota.

4. Financial Analysis (comparison with competitors)
Market share
Market share is one of those factors which can help in analysing any company’ performance and logistics. The below graphs are a clear
evidence that how the market share of all the tree companies have fared over years. Following graph gives a competitive analysis between
Hyundai and Toyota’ market share and how both the companies have fared.
Table clearly reflects that in 2014, Toyota gains 3rd position by selling 61,409 vehicles having a market share of 10.6%. However,
Hyundai and Mazda’s market share is comparatively lower to 2% and 1.4% respectively.

Above graph, presents that Mazda’s marketing share in Canada and USA came down to 3.79% and 1.85% in 2015.

Figure 1 (Market share) (Toyota, 2016)
If we look at current market share, then it can be seen that Hyundai has maintained a good state in the market share, with the numbers
being stabled in a positive way (Kanith and Madhur, 2016). From year 2014 to year 2015 the compnay showed a small increment but
after that has mainted a fair stabled state with year 2014 onwards experiencing a good growth in the share itself (Kim et al, 2016).
While the main targeted company for this report i.e. Toyota Motor Corporation hasn’t gained much. They are still way behind Hyundai
and Mazda in this field.They are quite stabled in their potion as they were in year 2012, this stability has made them stay in the market
but they haven’t see any progress which can depict increase their chances of market capitalization (Wada, 2015).
As mentioned in the above paragraph that Toyota’ performance is below Mazda but the fact that comes as a surprise is that Mazda’
market share is even above than that of Hyundai. Below graph shows that where Hyundai has been stabled (as depicted in previous
graph) and the below graph shows that Mazda has seen a good growth.

4.1. Revenue analysis and forecast
Revenue generation is the prime motive of any company and it is the aspect around which the whole business revolves. Toyota saw a
good growth in the time period from year 2005 to 2008 but then suddenly they have to face a massive drop in sales hence in
production (Lai, 2016). That was not different than a black time for them. But after 2012 time changed for them and the company was
back on track with sales and revenue generation. At present they stand at a good position I the market.

Figure 2 (Toyota operating income) (Source: Toyota, 2016)
Whereas on the other hand their core competitors have been quite consistent but way above Toyota. IN the following graph it is quite
evident that how Hyundai has maintained a good stability in the revenue generation.

2012 2013 2014 2015
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Revenue chart
As per the graph presented here, it can be seen that Hyundai generated largest amount of return as compare to the other firms. However,
on the other side, Toyota and Mazda’s turnover are comparatively shorter. Moreover, looking at percentage movement than it is founded that
Toyota’s revenue has been increasing at declining rate by 18.73%, 16.44% and 6.00% respectively. In contrast to this, in 2014, Mazda’s
turnover shows a high jump by 22.08% than came down by 12.69% in 2015. Furthermore, Hyundai’s sales have been increased by 3.36%,
2.23% and 3.03% respectively. High sales of Hyundai Motor Corporation are a clear indication of excellent performance comparatively than
Toyota and Mazda.
Figure 3 (Hyundai revenue generation) (Source: Hyundai, 2016)

While the third company focussed in the report Mazda too have been stabled in number of sales and in turn revenue generation but has
been on the lower sides of table.
Figure 4 (Mazda revenue generation) (Mazda, 2016)