Business Report: Hybrid Car Innovation for Toyota Motor Company

This report presents a business innovation idea for Toyota Motor Company, focusing on the manufacturing of hybrid cars to expand its consumer base and secure a strong market position. The report details the rationale for the proposed innovation, highlighting its benefits in terms of environmental impact and cost-effectiveness. It outlines a proposed business model, including key partners, activities, resources, and cost structures. Furthermore, the report identifies critical success factors essential for the successful implementation of the hybrid car initiative. Finally, it evaluates the feasibility of the idea, considering customer base, team requirements, growth potential, and resource gathering. The conclusion summarizes the key findings and overall viability of the proposed innovation, positioning it as a strategic move for Toyota's future in the automotive industry. The report emphasizes the importance of adapting to government regulations, consumer preferences, and technological advancements in the automotive sector. The report also mentions the benefits of hybrid cars over fuel-powered cars.

Running Head: THINK BIG: HYBRID CARS
Think Big: Motor cars
Name of Student
Name of University
Author note

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THINK BIG: MOTOR CARS
Executive summary
The report suggests an innovation idea for Toyota Motor Company to manufacture hybrid cars
for extending their consumer base and securing a safe position in the market. The paper discusses
the reasons for suggested innovation and benefits of the idea along with proposing a business
model for the new product. Finally, the report concludes with critical success factors and
evaluations of the perceived idea’s feasibility.

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Table of Contents
Introduction......................................................................................................................................3
Reason for innovation......................................................................................................................3
Benefits of the idea..........................................................................................................................4
Proposed business model.................................................................................................................5
Critical success factors to be managed during execution of the idea..............................................8
Evaluation of the feasibility of the idea.........................................................................................10
Conclusion.....................................................................................................................................11
References:....................................................................................................................................12

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Introduction
Even though the automobile industry is one of the leading sectors of the world,
companies have been facing serious problems due to new regulations introduced by the
government and the increasing competitions from rival firms. An innovation in the
manufacturing and designing of vehicles become indispensable in this context. Hybrid cars are
an excellent option for innovating the product model. This report elucidates the reasons and
benefits of the idea along with proposing a business model, critical success factors an feasibility
of the same.
Reason for innovation
Hyundai should launch hybrid motorcars for securing a sustainable future in the market.
engines running on internal combustion will soon see its end as per the government
announcements that mandates the use of manufacturing materials that are less taxing on the
environment. As of 2018, the frequency of zero emission vehicles (Shaheen, Cohen & Jaffe,
2018) has gone up on the roads. The government’s regulations that limits the sale and usage of
cars that is powered by internal combustion propels an innovative stance of automobile
industries. President Bush signed an agreement in 2005 to provide huge tax relief to hybrid car
buyers, due to the political and ecological pressures around the world to reduce the emissions of
greenhouse gases.The tax incentive varies by model. They must manufacture hybrid and electric
vehicles that are both cost effective and eco-friendly. Moreover, the consumers are keen on
increasing the efficiency of the vehicle and the company must cater to the preferences of the
consumers for maintaining brand value. Fuel-powered cars are often not as efficient as
electrically charged ones and they are also reported to be more prone to damage than hybrid
vehicles. Skilful driving is also an issue among the young crowd. Since hybrid cards can easily

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accommodate automatic gearing, making things easier for the driver, they appeal more to the
young crowd who may not be as efficient in driving in the city.
Benefits of the idea
The environmental damage and the rising cost of fuel has led many car owners and new
buyers are looking for alternative ways to save money. The supply of fuel is finite and gad price
has been on the hike since ages. The manufacturing cost of fuel-powered cars is too taxing on the
company’s resources, and equally heavy on the consumer’s pocket. The popularity of hybrid cars
in recent years is due to its lower cost of production and new hybrid car technology, which is
being developed and researched upon over the past decade. Owning a hybrid car is affordable
and it saves gas (Richardson 2013). These vehicles are designed to combine the cleaner energy
of an electric motor with a long range capacity of a gasoline engine allows a hybrid car to save as
much as 30 miles gallon. Hybrid cars also help reduce noise pollution since they are mute when
stationary and less noisy while in motion as compared to other cars. Hybrid cars emit lower toxic
emissions (Milo et al., 2014) compared to conventional gasoline-powered cards due to less
gasoline being burned. Instant torque is another benefit of these cars. The horsepower and
torques associated with some hybrid cars make the drives extremely pleasant, given their
relatively modest output. Many hybrids are constructed using lightweight materials, so they don’t
consume as much energy as their full weight counterparts. The higher resale value of hybrid
vehicles makes them more desirable to buyers (Bradley and Al-Alwai, 2014) Hybrid cars are
decked out with top technology (Mauser et al., 2013), they are renowned to be featured with the
latest and greatest technology both under the hood and inside the cabin. Apart from gas savings,
hybrid cars is also favorable for maintenance savings. There is a lot of wear and tear items that
typically can break down on gas. the first of which is the starter because the electric motor for

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starting the gas engine, there’s no need for a vehicle tab of starter. Second is an alternator, the
hybrid system regulates all the electricity through the vehicles so there is no need for an
alternator.
Proposed business model
Key Partners
Charging network
partners
Parking locations
vary from hotels to
garages.
Marketing agencies
Hardware
companies
Key Activities
 Establishing a
new standing
in the field of
automotive
services
 Designing
automobiles
that is
designer
friendly.
 Improving the
services over
time with
new,
exclusive
software
updates.
Value
Proposition
 Fastest
accceler
action
 Long
ranges
 Newly
designe
d
models
 Can be
charged
anywher
e
 Service
adheres
to latest
Customer
Relationships
The customer
relationship is
managed with
the help of :
 Social
Media
 Custom
er
Feedbac
k
 Custom
er
support
(Hong,
&
Customer
Segments
 stude
nts,
office
goers
 Eco-
consci
ous
and
safety
consci
ous
peopl
e
 The

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 Innovative
design that is
as efficient as
it is stylish.
techniqu
es
 Availabi
lity of
wall
connect
or for
fast
charging
 Provisio
n for
autopilo
t for fast
and
stress-
free
driving.
 Safe and
eco-
friendly
Fauvel,
2013).
 Test
driving
 Smart
alerts
 System
monitori
ng
 Softwar
e
updates
 Remote
diagnost
ics
 24*7
service
availabl
e for
365
days
middl
e
class
 Amat
eur
driver
s
Key Resources Channels
 Website

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 Engineers and
hardware
developers
 Cost efficient
devices like
dual motors
(Lajunen,
2014)
 Unconvention
al thinkers
who think out
of the box
 Raw materials
like graphite,
cobalt and
lithium
(Diouf and
Pode, 2015).
 Batteries and
chargers
(Krein and
Yalmaz,
2013)
 Sales
network
(direct)
 Car
dealersh
ips (self-
owned)

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Cost Structure
 Office expenses (showroom staff,
electricity and infrastructure)
 Software and hardware development
 Transport expenses for delivery
 Pioneering technology
 ICT
 Marketing
 Promotion
 Sales and services
Revenue Streams
 Advertising costs (Kiel, 2014).
 Vehicle sales
 Maintenance plans
 Sales of wall connectors
The hybrid car will be modeled on new innovative design using latest technologies with
the cost efficient and technologically advanced resources. The official website of the company
will be the main channel of consumer contact while the sales network will perpetuate business
growth. Unique features like auto-pilot, fast acceleration and flexible charging systems will be
the value proposition both for the company and the product (Fink and Weyer, 2013). The target
consumer base would be people who are conscious about the environment and run on a tight
budget. Hardware companies and market agencies could be the key partner of the company for
manufacturing and selling hybrid cars.

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Critical success factors to be managed during execution of the idea
Simplicity in strategy management implementation- The inexorable link between strategy
and governance while execution and during planning makes the alignment of the two crucial
components of business essential to success. For building strategic expectations that are realistic,
the governance has to exist first before it is aligned with planning. The governance of the
company’s management should address things like metrics and measurements, project planning,
master scheduling, plan rejuvenation and accountabilities (Hill, 2017).
An analysis of current scenario before future planning- The tendency of organizations to
jump into future planning directly without examining the current affair of things is a very
common mistake they make during strategic planning. Once the business ecosystem have been
fully comprehended after conducting an analysis of current-state, it becomes easier for strategic
planner to identify the shortest route to reach their objective. This path to success relies heavily
on the understating of the company’s value proposition, core values, culture, competitive
environment and organizational structure. For ensuring growth, planning should be based on the
gap identified during the comparison between the observed challenges and the organizational
structure.
Implementing strategy through change management program- one of the major reasons
why organizations struggle with proper execution lies with their failure to manage change. Not
involving the employees during the occurrence of the planned transformation could be a reason
for such failures since some complicated plans and changes are executed too ambitiously and
randomly so the workers are made aware of the changed plans only during its execution. After
the development and approval of a strategic plan, the organization must follow up with thorough

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communication so the employees are informed of the strategies and they (the strategies) are less
prone to failures.
Strategy alignment with business processes, mission and operational tactics- the
marketplace consumers of an organization will never understand the business unless an
organization succinctly explains the nature of their business, the services they provide and the
exclusivity of those services. The statement of an organization’s mission should therefore be
defined in broad and precise terms so that it has enough rooms for maneuvering and yet be
purposeful and direct in their definition of the served markets and the kind of services provided.
The planning in operational level should describe executional tactics and correlate action with
strategy. Since companies tend to skip the step of operational planning and fail to focus on
details, they run the risk of misalignment. The activity affects resource plans, business processes,
schedules and infrastructure, therefore it has a crucial alignment with budgets. It further impacts
marketing and sales by having downstream consequences on them.
Evaluation of the feasibility of the idea
Identifying the customer base- The key factor to understanding business profitability is
identifying the potential consumer base of the provided services. Understanding customer
requirements, needs and expectations from the consumer’s rather than the business owner’s
standpoint is necessary. As already mentioned, the consumer base for hybrid cars are people
conscious about the environment and have a limited budget for purchasing a car.
Team requirements- One of the most indispensable element of an efficient business team
is having a reliable and honest adviser or a mentor who will guide in the initial and former stager
of the business. Even if an entrepreneur starts unaccompanied and solo, the business will require

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a professional expert to help in the strategic planning of the different facets of the business’
specialization.
Growth potential- different business have different potential for growth depending on the
kind of available services and product specialization. For maximum growth rate, the
entrepreneurs of the company must be fixated on where they want to see their business and chalk
out plans accordingly. Electronic vehicles are quite in vogue these days and all it requires for the
company to boost up sales rate is to reach out effectively to the target audience and introduce
some innovations in the models. The market reports of car purchase indicate that the growth
potential of hybrid cars industry is strikingly high (Gao et al., 2018).
Gathering resources- The conversion of an abstract idea to a concrete business requires
whole lot of resources apart from effort and hard work. Making a list of the key asset
requirement, the essential resources and associated costs will help the organization determine the
crucial resources that are required for manufacturing the product. Car manufacturing involve
bulk of resources although the raw materials that goes into the manufacturing of hybrid vehicles
is comparatively low than the expensive resources required for fuel-driven cars. Once the
resources and the costs associated with it is sorted out, it would be helpful for the company
officials to estimate the total cost of investment and hence, comparative feasibility.
Evaluation of services or products- For assessing the consumer behavior and purchasing
habit of consumers in the market, it is important to understand and know the purpose of the
services provided and the products manufactured by the company. There are similar brands
specializing in hybrid vehicles in the market, if would benefit the company if it differentiates the
product in terms of target audience and purpose. Hybrid motorcars have a unique, rather noble
purpose. It reduces C02 emissions in the atmosphere and hence is a noble step towards

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environmental conservation and protection. For appealing to different target audience, the cars
can be geared with special features like regenerative breaks and automatic pilot system.
Conclusion
The discussions of the report reveals that manufacturing hybrid cars will be a massive
benefit for the company and ensure a considerable boost in sales and an extended customer base.
Additionally, it may also have improve the brand value of the company. The evaluation of the
idea along with the critical success factors must be taken into consideration before planning the
innovation.
References:
Al-Alawi, B. M., & Bradley, T. H. (2013). Total cost of ownership, payback, and consumer
preference modeling of plug-in hybrid electric vehicles. Applied Energy, 103, 488-506.
Calabrese, G. (Ed.). (2016). The greening of the automotive industry. Springer.
Denton, T. (2016). Electric and Hybrid Vehicles. Routledge.
Diouf, B., & Pode, R. (2015). Potential of lithium-ion batteries in renewable energy. Renewable
Energy, 76, 375-380.
Ehsani, M., Gao, Y., Longo, S., & Ebrahimi, K. (2018). Modern electric, hybrid electric, and
fuel cell vehicles. CRC press.
Fink, R. D., & Weyer, J. (2013). Interaction of human actors and non-human agents. A
sociological simulation model of hybrid systems. Science, Technology & Innovation
Studies, 10(1), 47-64.

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Frieske, B., Kloetzke, M., & Mauser, F. (2013, November). Trends in vehicle concept and key
technology development for hybrid and battery electric vehicles. In Electric Vehicle
Symposium and Exhibition (EVS27), 2013 World (pp. 1-12). IEEE.
Hill, T. (2017). Manufacturing strategy: the strategic management of the manufacturing
function. Macmillan International Higher Education.
Lajunen, A. (2014). Energy consumption and cost-benefit analysis of hybrid and electric city
buses. Transportation Research Part C: Emerging Technologies, 38, 1-15.
Lajunen, A. (2014). Energy consumption and cost-benefit analysis of hybrid and electric city
buses Hareuveny, R., Sudan, M., Halgamuge, M. N., Yaffe, Y., Tzabari, Y., Namir, D., &
Kheifets, L. (2015). Characterization of extremely low frequency magnetic fields from
diesel, gasoline and hybrid cars under controlled conditions. International journal of
environmental research and public health, 12(2), 1651-1666.. Transportation Research
Part C: Emerging Technologies, 38, 1-15.
Millo, F., Rolando, L., Fuso, R., & Mallamo, F. (2014). Real CO2 emissions benefits and end
user’s operating costs of a plug-in hybrid electric vehicle. Applied Energy, 114, 563-571.
Richardson, D. B. (2013). Electric vehicles and the electric grid: A review of modeling
approaches, Impacts, and renewable energy integration. Renewable and Sustainable
Energy Reviews, 19, 247-254.
Shaheen, S., Cohen, A., & Jaffee, M. (2018). Innovative Mobility: Carsharing Outlook.
Yilmaz, M., & Krein, P. T. (2013). Review of battery charger topologies, charging power levels,
and infrastructure for plug-in electric and hybrid vehicles. IEEE Transactions on Power
Electronics, 28(5), 2151-2169.