Toyota Competitive Strategy: Porter's Five Forces, SWOT and PESTLE Analysis

Toyota competitive strategy1
TOYOTA COMPETITIVE STRATEGY
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Toyota competitive strategy 2
Toyota competitive strategy
Introduction
Toyota is a Japanese corporation that involves in the manufacture, design, assembly, and
sales of commercial cars, and linked accessories and parts in Asia, Japan, North America, and
Europe (Toyota Motors 2014). Toyota Company competes in an automotive industry.
Skyrocketing fuels rates and escalating environmental distresses have moved consumer’s
inclinations from the fuel-guzzling cars to more fuel-efficient vehicles. Certain automakers
contained the move by growing their products portfolio and differentiating into the manufacture
of hybrid rechargeable motor cars. Global automobile demand is knotted to per capita disposable
revenue, vehicle values and product invention (Toyota Global. Com 2014). For better
comprehensive analysis of Toyota operation, the paper will deal with Porter's five forces, SWOT
analysis and the PESTLE analysis.
Porter’s five forces
The five effects are; “Threat of New Competitors, Threat of Substitute Products or
Services, Bargaining Power of Buyers, Bargaining Power of Suppliers and Competitive Rivalry
among Existing Firms” (Cohen et al. 2013, pp. 7).
The threat of new entry (weak): a significant capital is a must to enter the motor industry.
Additionally, all automobile including the Toyota has established reputation and image. Design
and engineering quality differentiate its products.

Toyota competitive strategy 3
Supplier power (weak): a large number of suppliers but the significant portion is pretty small.
The material is widely available, and dealers do not pose any danger of forwarding
incorporation.
Buyer threat (strong): many consumers exist and most of them are persons that purchase a car,
but corporate or government typically purchase huge fleets and thus bargain for a lower rate
(Nkomo 2013, pp. 8). Buyers do not threaten background integration, and their choice is
habitually based on how much does the merchandise cost. Buyers can choose another alternative
brand and do not require much for the switch.
Threats of substitutes (weak): many alternatives exist such as motorcycles trains, bicycles, planes
or buses. However, the replacement can hardly offer the same suitability.
Competitive rivalry (strong): reasonable number of rivals and if the business decides to leave the
trade, it will suffer huge loses. The business is large but mature, and clienteles are devoted to the
brand
SWOT analysis
Strengths: Toyota has a robust market position in diverse topographies across the sphere.
Resilient focus on the research and development (R&D): the solid emphasis on the R&D to
expand its products portfolio and improve the functionality. Strong emphasis on the R&D has
assisted the corporation in integrating new aspects of its prevailing variety of the products. Wide
production and delivery system exists; the company and its associate's produce interrelated parts
in more than 50 production firms in 27 nations besides Japan (Toyota Motors 2014).