History:

Toyota abbreviated as TMC, is a multinational corporation headquartered in Japan. TMC is the

world's largest automobile manufacturer by sales and production. The company was founded by

Kiichiro Toyoda in 1937 as a spinoff from his father's company Toyota Industries to create

automobiles. Three years earlier, in 1934, while still a department of Toyota Industries, it created

its first product, the Type A engine, and, in 1936, its first passenger car, the Toyota AA. Toyota

Motor Corporation group companies are Toyota (including the Scion brand), Lexus, Daihatsu

and Hino Motors, along with several "non-automotive" companies. TMC is part of the Toyota

Group, one of the largest conglomerates in the world.

Toyota Motor Corporation is headquartered in Toyota City, Aichi and in Tokyo. In addition to

manufacturing automobiles, Toyota provides financial services through its Toyota Financial

Services division and also builds robots.

Replica of the Toyota Model AA, the first production model of Toyota in 1936

The story of Toyota Motor Corporation began in September 1933 when Toyoda Automatic

Loom created a new division devoted to the production of automobiles. Quickly thereafter, the

division produced its first Type A Engine in 1934, which in turn was used for the production of

the first Model A1 passenger in May 1935 and the G1 truck in August 1935. Production of the

model AA passenger started in 1936.

Branding and Logo:

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 life

Simplify the pronunciation, and

Give the company an auspicious beginning. Toyota is considered luckier than Toyoda in

Japan, where eight-stroke count in the Japanese language was associated with wealth and

good fortune.

The original logo no longer is found on its vehicles but remains the corporate emblem used in

Japan. Still, there were no guidelines for the use of the brand name, "TOYOTA", which was used

throughout most of the world, which led to inconsistencies in its worldwide marketing

campaigns. To remedy this, Toyota introduced a new worldwide logo in 1989 in conjunction

with and to differentiate it from the newly released luxury Lexus brand. There are three ovals in

the new logo that combine to form the letter "T", which stands for Toyota. The overlapping of

the two perpendicular ovals inside the larger oval represent the mutually beneficial relationship

and trust that is placed between the customer and the company while the larger oval that

surrounds both of these inner ovals represent the "global expansion of Toyota's technology and

unlimited potential for the future."

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.

Fortunately for Toyota, the war ended shortly before a scheduled allied bombing run on the Toyota factories in Aichi.

Start of Commercial Production 1947-

Commercial passenger 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.

Today Toyota is one of the top manufacturers with large market shares in both the US and Europe. It has a small division, selling under the Daihatsu brand as well as a heavy vehicle division, selling under the Hino brand.

Toyota is Japan's biggest company and the second largest in the world (the larger being General Motors). The company is immensely profitable, and its massive reserves dwarf those of many countries. Toyota's vehicles are generally highly regarded for their quality, proficient engineering, and value; but their designs are often viewed as visually bland and lacking the flair seen in cars from certain smaller manufacturers.

Toyota offers one of the largest ranges of vehicles of any manufacturer and amongst its more predictable high-volume models produces a number of exciting sports cars: the Celica, the MR2, and the Supra, the latter which was discontinued in 1998 for export and in 2002 in Japan altogether.

Worldwide Presence

The headquarter of Toyota in Toyota City, Japan:

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 and France. Cars from these plants are often exported to other countries. For example, the South African-built Toyota Corolla is exported to Australia, while the Australian-built Camry is exported (in left hand drive) to countries in the Middle East. Between 1997 and 2000, the number one selling in the U.S. was the Toyota Camry. It was dethroned in 2001 by the Honda Accord, only to regain its place in 2002, with the introduction of a redesigned model.

Toyota India is one of the largest subsidiaries of Toyota. They currently produce three cars, including the Camry, Corolla, and the Sequoia (Land Cruiser Prado in other countries). Toyota also produces a range of SUVs. Indeed, one of its first export markets was exporting its Landcruiser model to Australia in the late 1950s.

Toyota also contributes a great amount of research to cleaner-burning vehicles.

In 2002, Toyota successfully road-tested a new version of the RAV4 which ran on a Hydrogen Fuel Cell.

Scientific American made the company its Leader of the Year in 2003 for commercializing an affordable hybrid car.

In 2004, Toyota showed that it had made its Highlander into the world's first mass-market seven-passenger hybrid SUV.

To gain a higher share in the U.S. domestic luxury market, Toyota introduced a separate brand called Lexus in 1989, following Honda's (with its Acura division) example. The brand was introduced with two models: the ES 250, based on Toyota Camry, and the LS 400, which was released simultaneously as the Toyota Celsior in Japan. Since then, the lineup has been expanded with other models based on Japanese Toyotas, and the marque has been successful, receiving many industry awards. Now that it has become the number one selling luxury brand in the U.S., Toyota is introducing it to Japan in 2005, thus completing a cycle of sorts.

In 2003, Toyota brought two of their popular cars from Japan (including the bB) to America, and created a new badge, called Scion, meaning a descendant or heir. These cars are targeted towards the young, and young-at-heart. Both models, the xA (known in Japan as the Toyota ist) and xB (known in Japan as the Toyota bB) are powered by a 1.5L DOHC I4 engine taken right out of the Toyota Echo (known in Japan as the Toyota Platz), a derivative work of the Toyota Tercel. A third model, the Scion tC, was introduced in 2004. Instead of importing an existing model from Japan as was done with the xA and xB, the tC was designed specifically for the North American market, using a platform shared with the Avensis, a Toyota model not sold in North America.

Toyota has also been successful in racing, especially in Rally with the Toyota Celica as well as the Toyota Corolla. In 2002 Toyota started racing in Formula One with the Toyota Team Europe (TTE) and is based in Cologne (Germany).

Toyota is also famous in industry for its manufacturing philosophy, called the Toyota Production System. This system is copied worldwide by many manufacturing companies.

Introduction

Toyota Production System

After Second World War, Eiji Toyoda and Taiichi Ohno at the Toyota motor company in Japan pioneered the concept of Toyota Production System. The rise of Japan to its current economic pre-eminence quickly followed, as other companies and industries copied this remarkable system. Manufacturers around the world are now trying to embrace this innovative system, but they are finding the going rough. The companies that first mastered this system were all head-quartered in one country-Japan. However, many Western companies now understand Toyota Production System, and at least one is well along the path of introducing it. Superimposing this method on the existing mass-production systems causes great pain and dislocation.

The global adaptation, as it inevitably spreads beyond the auto industry, will change everything in almost every industry-choices of customers, the nature of work, the fortune of companies, and, ultimately, the fate of nations.

What is Toyota Production System? Perhaps the best way to describe this innovative production system is to contrast it with craft production and mass production, the two other methods humans have devised to make things.

Production methods

The craft producer uses highly skilled workers and simple but flexible tools to make exactly what the customer asks for one item at a time. Few exotic sports cars provide current day examples. We all love the idea of craft production, but the problem with it is obvious: Goods produced by the craft method—as automobiles once were exclusively—cost too much for most of us to afford. So mass production was developed at the beginning of the twentieth century as an alternative.

The mass-producer uses narrowly skilled professionals to design products made by unskilled or semiskilled workers tending expensive, single-purpose machines. These churn out standardised products in very high volume. Because the machinery costs so much and is so intolerant of disruption, the mass-producer keeps standard designs in production for as long as possible. The result: The customer gets lower costs but at the expense of variety and by means of work methods that most employees find boring and dispiriting.

The Toyota motor corporation, by contrast, combines the advantages of craft and mass production, while avoiding the high cost of the former and the rigidity of the latter. Toward this end, they employ teams of multi-skilled workers at all levels of the organisation and use highly flexible and increasingly automated machines to produce volumes of products in enormous variety.

The Toyota Production System is also defined as Lean Production because it uses less of everything compared with mass production—half the human effort in the factory, half the manufacturing space, half the investment in tools, half the engineering hours to develop a new product in half the time. Also it requires keeping far less than half the needed inventory on site, results in many fewer defects, and produces a greater and ever growing variety of products.

Perhaps the most striking difference between mass and Toyota production system lies in their ultimate objectives. Mass-producers set a limited goal for themselves— "good enough," which translates into an acceptable number of defects, a maximum acceptable level of inventories, a narrow range of standardised products. Lean producers on the other hand, set their sights explicitly on perfection.

Recent company developments

2007–2010 financial crisis

On May 8, 2009, Toyota reported a record annual net loss of US$4.2 billion, making it the latest automobile maker to be severely affected by the 2007–2010 financial crisis.

2009–2010 vehicle recalls

From November 2009 through the first quarter of 2010, Toyota recalled more than 8 million (accounts differ) cars and trucks worldwide in several recall campaigns, and briefly halted production and sales. The US Sales Chief, James Lentz, was questioned by the United States Congress committees on Oversight and Investigations on February 23, 2010, as a result of recent recalls. On February 24, 2010, Toyota CEO Akio Toyoda testified before the House Committee on Oversight and Government Reform. On 6 April 2010, The US government sought a record penalty of US$16.375 million from Toyota for its delayed response in notifying the National Highway Traffic Safety Administration regarding the defective accelerator pedals On 18 May 2010, Toyota paid the fine without an admission of wrongdoing. The record fine and the high profile hearings caused accusations of conflict of interest. The US government is regulatory body and part owner of two major competitors, General Motors and Chrysler. Senior managing director Takahiko Ijichi said that recall-related costs in the financial year that ended March 2010 totaled US$1.93 billion (¥180 billion).

TOYOTA'S SECRET:

If you enter the lobby of Toyota's headquarters in Japan, you will see two small portraits and one big one hanging there. The two small ones show the founder and the current chairman of the company. The large portrait shows an American. It is Dr. Edward Deming. Who is Edward Deming you might ask? And indeed who is he? But it's a long story and one cannot explain who Edward Demings is without involving characters like the Japanese, the Americans and the Toyota Company. So here goes…

Long Ago and Far Away…

World War II had barely ended, the Japanese were left with a devastated country, ruins that were previously houses and a battered economy. But there was something left that helped them overcome all this destruction. They did not sit and lament their fates but began thinking…where do we go from here and to get there what do we need to do? Factories began production again firstly to supply all the basic necessities and after around 15 years when everyone had the basic goods they needed, they turned their energies towards overcoming the surplus of imports. Japan needed to offer something more in their goods if they had to succeed on foreign shores....

The Japanese car manufacturers namely Toyota wanted to start operations in America. That was all very well. But how could they make the Americans buy their cars rather than local ones. Enter Dr. Edward Demings and hey presto! They had the secret recipe! The man who according to his biographer Rafeel Agumayo(1) is the American who taught Japan what quality management is. Dr. Edwards Deming was a physicist specialized in the field of statistics and worked in United States Bureau of Census. His greatest contribution on the evaluation of statistical methods for ensuring the quality of census assessment established him as a leader in the field of Total Quality Management. In fact he is considered as the "Guru" of Total Quality Management. Deming also enunciated 14 principles for quality management which include innovation, the philosophy of quality to be inculcated in all individuals,

appropriate and complete supervision, absence of fear and openness, ensuring quality from design through to maintenance, work standards in production, training of every worker in statistical methods, retraining people to new skills and so on.

The world saw Toyota take over America by storm, they offered better, faster, more comfortable and more efficient cars and Americans came to buy cars from them in droves. But America was not the only stop, in fact Toyota quickly became the largest car Manufacturer in the world. And there has been no looking back since.

How Toyota Does It—Everyday

Fewer man-hours. Less inventory. The highest quality cars with the fewest defects of any competing manufacturer. In factories around the globe, Toyota consistently raises the bar for manufacturing, product development, and process excellence. The result is an amazing business success story: steadily taking market share from price-cutting competitors, earning far more profit than any other automaker, and winning the praise of business leaders worldwide. How do they do it?

One of their secrets that gives them an edge over other car Manufacturers is the ‘Toyota production System'. Toyota had discovered earlier on that the key to their success was Total Quality Management (TQM) . To make sure that they incorporated TQM in every stage from designing to car manufacturing to after sales service they developed the Toyota Production System (TPS). Initially developed in Japan, TPS or the Toyota Production System, was transplanted to the United States nearly two decades ago, when Toyota launched a joint venture with General Motors Corp., called New United Motor Manufacturing, Inc., or NUMMI, based in Fremont, Calif.

One of the aspects of the Toyota Production System (TPS) that tends to be overlooked--or is at least not mentioned as frequently as subjects such as kanban or kaizen--is the fact that there are people involved. Instead, TPS is discussed almost as though the practices are what's essential.

But when you talk to a key practitioner of TPS, such as Mike DaPrile, vice president-Manufacturing, Toyota Motor Manufacturing-Kentucky, people come first. As in, "One of the things that we do for efficiency and lean manufacturing is putting responsibility in worker's hands. I know that sounds naive, but it is not."

He adds, "I really believe in giving people responsibility. Efficiency comes from improving processes--from people kaizening their own processes." Of course, there is something else that must be taken into account: "There is little concern here about being laid off." Should a person improve him- or herself out of a position, they stay on their team for six months, then transition over to a kaizen team.

According to DaPrile, there are several keys to lean manufacturing, all of which relate to the people who are actually doing the work. For example, there is never a situation where a machine is in control of a person; a person always controls the machine. The andon system--the cord that the worker can pull to stop the line--is an example of a person being in charge of an assembly line. (Contrast this to places

where the speed of the line paces the worker, where it is up to the worker to keep up with the machine, where the machine keeps going regardless of the quality being produced. "The andon system allows the person to stop the line to incorporate good quality in the product.")

Safe & Engaged. Further, DaPrile states with emphasis, "We feel strongly that safety is a top priority." And by creating a safe workplace, there is improvement in

morale. And as morale rises, there are gains in both quality and productivity. This is not the proverbial double win (management and workers), but actually a triple win, in that the customer receives a better product (which explains, in large part, why the Camry is continuing a run on the top of the best-selling car in America list).

To keep the people engaged in their work, they do a number of things at the Toyota plant in Georgetown, KY. For example, they level the production. This is a means by which there is assurance that people can get their jobs done in the amount of time available without having them waiting around. "People don't like to wait," DaPrile says. "It's tiresome and boring."

Also: "We also eliminate the muda"--the waste--"of conveyance and walking." Parts are delivered to line side; people don't have to travel far to do their jobs. And because there is a recognition that doing the same thing over and over and over again can be stultifying (which would have a deleterious effect on quality), they have people rotate to a different task within the processes every two hours.

Everything has to be where it is needed when it is needed because part of TPS is just-in-time inventory, which means that are isn't a fleet of forklifts rolling through cavernous warehouses (and let's face it: Toyota Industrial Equipment builds forklifts, which they'd undoubtedly provide to its sister company at a discount, so a fleet would probably be comparatively economical).

The Difference

Here's a key difference between Toyota and others that says a lot about the importance of TPS: "We do the same amount of work as everyone else, but we do more added value by eliminating waste."

Looked at another way: building a car is building a car, whether it is a Camry or something else--the same operations are required. How those operations are performed makes all the difference in terms of quality and efficiency.

And the how has a whole lot to do with what the people who work in the plant do. "They set up their own processes--not engineers," he says. There isn't a situation where the people just load and unload equipment. The 8,000 people (all of whom are at least high school graduates) are given the opportunity to think. There is an actual measure of how much the people think: last year, DaPrile points out, there were more than 98,000 suggestions made to improve things--99% of which paid out (considering only one plant).Plenty of operations are driven by results, by the ends, not the means."We are very process oriented here," DaPrile says, "not results oriented. The results will come." Have good processes and then reap the rewards, attain the results.

DaPrile talks about the importance of having enthusiasm. He thinks that it is essential. "One of the things we do to help keep the people enthused"--this in addition to ceremonies and the like--"is to keep them challenged. You can get bored, lackadaisical, and take things for granted if you do the same things over and over. We change things here." Sure, they use the Toyota Production System, but system doesn't mean that you create a rut and stay in it: It is a process that allows you to change things.

"We haven't been stable here for 13 years: We've had new products, growth, and new ideas," DaPrile says, adding, "Every day is a new day here." And the improvements are, well, continuous. Total Quality Management all they way….

The Secret that Spells Success

With a market capitalization greater than the value of General Motors, Ford, and Chrysler combined, Toyota is also, (by far), the world's most profitable automaker. Another of Toyota's secret weapon is Lean production--the revolutionary approach to business processes that it invented in the 1950's and has spent decades perfecting. Today businesses around the world are implementing Toyota's radical system for speeding up processes, reducing waste, and improving quality.

Toyota integrated TQM into lean production in 1960. Developed by Taichi Ohno, lean production aims to eliminate seven wastes or things that can go wrong, of which quality is one. Others include overproduction, waiting of any kind, and unnecessary motion of a worker.Lean production applies TQM to all seven wastes at the same time rather than tackling each problem individually, saving not only time but money and energy.

Jeffrey K. Liker in his book, "The Toyota Way", explains Toyota's unique approach to Lean Manufacturing--the 14 management principles and philosophy that drive Toyota's quality and efficiency-obsessed culture. Professor Jeffrey Liker who has been studying Toyota for twenty years, and was given unprecedented access to Toyota executives, employees and factories, both in Japan and the United States, for this landmark work. The book is full of examples of the 14 fundamental principles at work in the Toyota culture, and how these principles create a culture of continuous learning and improvement. You'll discover how the right combination of long-term philosophy, process, people, and problem solving has transformed Toyota Motor Corp. into a Lean, learning enterprise.

(Alessandro Volta concept)

One market that Toyota is just now getting back into is the sports car arena. Toyota has electrified automotive history with the first high-performance hybrid, called the Alessandro Volta. According to Toyota.com, the Giugiaro-designed carbon-fiber body seats three people abreast and features "drive-by-wire" controls, allowing you to position the steering wheel and pedals in front of any one of them. And the Volta's 408-hp Hybrid Synergy Drive® (a 3.3-liter V6 with an electric motor for each axle) not only delivers 435 miles on a 13.7-gallon tank, but 0-60 acceleration in a mere four seconds. This concept car will surely turn heads as well as push Toyota even closer to taking over General Motors for the number 1

automaker in the world. It has the power and looks to make any car enthusiast drool at the mere mention of its name!

Expanding to New Markets

To become number one in its industry, must always look for new markets. The company must be able to spot these markets and do what it can to gain dominance over them. The automobile industry is a very interesting market. The world is in a time when it can see how automobile companies, like Toyota, are expanding their business into these new emerging markets. Two major markets that Toyota is expanding into are the Chinese and Indian economies. These are the two top growing economies and all automobile manufacturers are trying gain a significant share of these markets. Another growing market is the hybrid market. With rising oil prices and growing concerns about the environment, the hybrid market is key for Toyota to become the number one automaker.

When expanding to a new market, you need a good strategy that presents the best opportunity to enter the market. For example, with their entry into the Chinese market, Toyota adopted a three step plan. Chinadaily.com reported Toyota's three step plan was, "first to establish a local sales network and launch brand promotions, then to build auto parts manufacturing bases, and, finally, to establish joint ventures (JVs) with local players and produce automobiles." It seems that since the Chinese market is young and a lot of buyers are first time buyers, brand promotion and developing a local sales network is definitely a key step to nail. Being able to secure customers early will lead to future success in the market and help in Toyota achieving its goal to be number one. In 2003, Toyota was importing 50,000 vehicles a year and had 57 joint ventures and wholly owned auto parts companies. The other key step is production of its vehicles locally. This is important in keeping costs down and relationships with local companies that will help Toyota in the long run. Mckinsey.com's study of the Chinese automobile market listed five areas where companies need to build in order to have success in China. These steps are: "A robust product/market strategy, a distinctive brand position, a high-quality distribution network, strong local organizational capabilities, and advantageous alliances and partnerships." These are all areas where Toyota has initially focused on and needs to continue build in order to find success. Since Toyota's late entry into the Chinese market, the company has begun raising production in China. By 2010, Toyota plans on building 300,000-400,000 vehicles in China. Their plant in Tianjin plans on producing 30,000 Crown models from this year forward. Toyota's growth in China is continuing to improve, and the company is beginning to see great results in their growth in China. They project that their sales in 2005 are 50% higher than 2004. Of their projected 179,000 units sold, 150,000 were produced in China. Continuing its success in China will help Toyota in its goal to be the number one automaker.

As with China, India is another emerging market that is key when vying to become the top automaker. Toyota has a very positive view of India as an emerging market. In fact, India.com reports, "Sources say Toyota expects India to become one of the largest Auto market in the next twenty years. They even predict India may exceed China and parallel to some extent US market in that time frame." With this kind of view on the Indian market, it is essential for Toyota to take advantage of this market now. Currently, Toyota holds 5% of the Indian market share and plans on having a 10% market share by

2010 which would be around 200,000 vehicles. Toyota's view for India is to improve on its current products and introduce new products to the market. They are also ready to move away from some of its current products. Atsushi Toyoshima, managing director at Toyota Kirloskar Motor told the Economic Times, "Times must change. What we are introducing to the market is the latest from our International Motor Vehicle development platform around the world, and the Innova is the first child of that platform. The Indian launch is one of the first launches, and hereby proves that what we give to the Indian market is the latest and very best. The Innova utilizes a state-of-the-art common-rail D4-D diesel engine and a very smooth VVT-I petrol engine, making it one of the most-advanced cars on the road today." The introduction of the Innova is what he calls "the right product for the right country." The key to Toyota's success is that it designs products that customers want instead of what they think the customer wants. Other goals Toyota has for India is to have 60 dealers by the end of 2005. The company had 44 dealers in March of this year. In terms of production, their target is 50,000, 38,000 of which are the Innova and the Corolla making up the remainder, which is the highest selling car in its category. If Toyota continues on its current path and meets its goal of 10% of India's market share by 2010, the company will be in good standing to reach its ultimate goal of being number one.

Another market Toyota plans to secure is the hybrid market. With gas and oil prices continuing to rise, the hybrid market is one of high importance to automakers. Also, the growing issue of air pollution is leading to consumers looking for alternatives when it comes to their vehicles. Since they were the first to come out with a hybrid vehicle, Toyota plans on continuing to be the leader in the hybrid market. Currently, Toyota offers the Prius, the Highlander Hybrid, and is soon to launch the Camry Hybrid. To feed this market, Toyota plans on selling 250,000 hybrids this year alone. Next year, they plan on upping that number to 350,000-400,000. They are planning on the numbers to increase to over a million vehicles a year starting in 2010. To cut costs and make the hybrid vehicles more affordable, Toyota is planning on building a smaller version of its hybrid powertrain engine. The target for this new engine is 2008. This is a huge opportunity for Toyota to really lower the cost of its hybrids which already cost thousands of dollars more than regular gas vehicles. This will be big in attracting new buyers. Lindsay Brooke, an auto analyst at forecasting firm CSM Worldwide, when asked to address the effect which the high price of gas has on the sale of hybrids, said, "they would have to go over $3.50 a gallon to really start to force people to make profound changes in their car purchases.(detnews.com)" If gas prices don't rise that high, the way to sway buyers to hybrids will be to lower their costs. The hybrid market is big because it allows Toyota to increase sales in already existing markets like the United States and Europe. The increased sales in the hybrid market will help Toyota increase its 12.8% share of the US market, considering hybrids currently make up only 1% of US light vehicle sales. Toyota is prepared for the future in hybrids and will use that to help them become the number one automaker in the world.

Compare Auto Industry to Another Industry

The automotive industry is comparable to the computer manufacturing industry. Both industries produce one basic product which is upgradeable in numerous ways. Each of these industries has a core of a few manufacturers that dominate the majority of the industries market share. Both of these industries are in exciting times which are full of innovations. Even though the automotive industry has been around for many more years than the computer industry the automotive industry is still be able to learn something from the growth of the computer industry.

The following points will illustrate how the automotive industry is hesitant to change until they are secured in both their previous specialty and their future area of expertise. By abiding by this doctrine cars have been the same for the past fifty years. Not many innovations have been made in the performance or efficiency overall. Although small changes have been made, such as a Toyota Camry getting better gas mileage than a sixty-four Impala, but the same ideas are still being used to produce a new product.

The computer industry on the other hand has been holding true to Moore's Law. Every eighteen months the processor speed of a computer can be expected to more or less double. Of course this is not feasible with internal combustion engines, but this does not prevent the research of other technologies. As stated earlier in the paper, recently manufacturers are beginning to make great steps into the hybrid technology.

The first comparative aspect of these industries is the use of new technologies. Generally, it is easier for an industry which has top products that only cost five thousand dollars to institute innovations than an industry in which economy products cost ten thousand dollars. However, the automotive industry should become more proactive with instituting new technologies similar to the way that the computer industry has. For example, when consumers started using MP3's to listen to and save music on their computers the electronics industry and major corporations from the computer industry started focusing major resources on portable players, which play MP3's. Even though this technology has been around for at least five years, there has been no major push from automotive manufacturers to have a digital storage device in a car. Different formats for listening to music is not the only example of where car manufacturers can learn from the computer industry.

Another example of the automotive industry not expanding into already developed technologies is the use of global positioning systems (GPS). If Toyota were to make a deal with Garmin, a very popular and established GPS producer, the motor company could offer various GPS systems in any of their vehicles. This software is in popular demand; Garmin even has links on their website for specific models of cars. This would be one way to enhance Toyota's product for the customer.

This does not mean the automotive industry is sticking solely to the same model. Many new technologies have been discussed which the automotive industry is actively pursuing. With these new changes, such as hybrid technology, Toyota is in some ways surpassing the computer industry in their ability to adapt to radical change.

Another example of car manufacturers adapting and even copying the computer industry is in their advertising. Both industries still produce standard television ads and brochures, but also utilize the

internet for effective sales. Thousands of people per day reach Toyota through its company website, which not only contains interactive ads and specifications of products. It follows the computer industry into product customization.

Dell was the first major company to perfect this system of letting the customer ‘build' their product on the internet, by choosing the parts they would like installed in their computer, and offering the ability to complete the order and pay for the product over the internet. The automotive industry is currently following in these footsteps by allowing the buyer to customize a car through their website, eliminating wasted time at the dealership.

Overall, the automotive industry is at times still sluggish to adapt to change, but is coming to the realization that what the consumer wants they need to produce. They are currently instituting new technologies and techniques already used by the computer industry. By doing so they are saving money and increasing productivity.

TOYOTA PRODUCTION SYSTEM:

Basic idea and Framework

The Toyota production system is a technology of comprehensive production management the Japanese invented a hundred years after opening up to the modern world. The basic idea of this system is to maintain a continuous flow of products in factories in order to flexibly adapt to demand changes. The realisation of such production flow is called Just-in-time production, which means producing only necessary units in a necessary quantity at a necessary time. As a result, the excess inventories and the excess work-force will be naturally diminished, thereby achieving the purposes of increased productivity and cost reduction.

The basic principle of Just-in-time production is rational; that is, the Toyota production system has been developed by steadily pursuing the orthodox way of production management. With the realisation of this concept, unnecessary intermediate and finished product inventories would be eliminated. However, although cost reduction is the system's most important goal, it must achieve three other sub-goals in order to achieve its primary objective. They include:

1. Quantity control, which enables the system to adapt to daily and monthly fluctuations in demand in terms of quantities and variety;

2. Quality assurance, which assures that each process will supply only good units to the subsequent processes;

3. Respect-for-humanity, which must be cultivated while the system utilises the human resource to attain its cost objectives.

It should be emphasised here that these three goals cannot exist independently or be achieved independently without influencing each other or the primary goal of cost reduction. All goals are output of the same system; with productivity as the ultimate purpose and guiding concept, the Toyota production system strives to realise each of the goals for which it has been designed. Before discussing the contents of the Toyota production system in detail, an overview of this system is in order. The outputs or result side as well as the inputs or constituent side of the production system are depicted.

A continuous flow of production, or adapting to demand changes in quantities and variety, is created by achieving two key concepts: Just-in-time and Autonamation. These two concepts are the pillars of the Toyota production system.

Just-in-time basically means to produce the necessary units in the necessary quantities at the necessary time. Autonamation ("Jidoka" in Japanese) may be loosely interpreted as autonomous defects control. It supports Just-in-time by never allowing defective units from the preceding process to flow into and disrupt a subsequent process. Two concepts also key to the Toyota production system include Flexible work force ("Shojinka" in Japanese) which means varying the number of workers to demand changes, and Creative thinking or inventive ideas ("soikufu"), or capitalising on workers suggestions.

To realise these four concepts, Toyota has established the following systems and methods:

1. Kanban system to maintain Just-in-time production

2. Production smoothing method to adapt to demand changes

3. Shortening of set-up time for reducing the production lead time

4. Standardisation of operations to attain line balancing

5. Machine layout and the multi-function worker for flexible work force

6. Improvement activities by small groups and the suggestion system to reduce the work force and increase the worker's morale.

7. Visual control system to achieve the Autonamation concept

8. Functional Management system to promote company-wide quality control.

Just-in-time production

The idea of producing the necessary units in the necessary quantities at the necessary time is described by the short term Just-in-time. Just-in-time means, for example, that in the process of assembling the parts to build a car, the necessary kind of sub-assemblies of the preceding processes should arrive at the product line at the time needed in the necessary quantities. If Just-in-time is realised in the entire firm, then unnecessary inventories in the factory will be completely eliminated, making stores or warehouses unnecessary. The inventory carrying costs will be diminished, and the ratio of capital turnover will be increased.

However, to rely solely on the central planning approach which instructs the production schedules to all processes simultaneously, it is very difficult to realise Just-in-time in all the processes for a product like an automobile, which consists of thousands of parts. Therefore, in Toyota system, it is necessary to look at the production flow conversely; in other words, the people of a certain process go to the preceding process to withdraw the necessary units in the necessary quantities at the necessary time. Then what the preceding process has to do is produce only enough quantities of units to replace those that have been withdrawn.

Kanban system

Many people think the Toyota production system a Kanban system: this is incorrect. The Toyota production system is a way to make products, whereas the Kanban system is the way to manage the Just-in-time production method. In short, the kanban system is an information system to harmoniously control the production quantities in every process. It is a tool to achieve just-in-time production. In this system what kind of units and how many units needed are written on a tag-like card called Kanban. The Kanban is sent to the people of the preceding process from the subsequent process. As a result, many processes in a plant are connected with each other. This connecting of processes in a factory allows for better control of necessary quantities for various products. The Kanban system is supported by the following:

Smoothing of production

Reduction of set-up time design of machine layout

Standardisation of jobs

Improvement activities

Autonamation

Autonamation

In order to realise Just-in-time perfectly, 100 per cent good units must flow to the prior process, and this flow must be rhythmic without interruption. Therefore, quality control is so important that it must coexist with the Just-in-time operation throughout the Kanban system. Autonamation means to build in a mechanism a means to prevent mass-production of defective work in machines or product lines. Autonamation is not automation, but the autonomous check of abnormality in the process.

The autonomous machine is a machine to which an automatic stopping device is attached. In Toyota factories, almost all the machines are autonomous, so that mass-production of defects can be prevented and machine breakdowns are automatically checked. The idea of Autonamation is also expanded to the product lines of manual work. If something abnormal happens in a product line, the worker pushes stop button, thereby stopping his whole line. For the purpose of detecting troubles in each process, an electric light board, called Andon, indicating a line stop, is hung so high in a factory that it can easily be

seen by everyone. The Andon in the Toyota system has an important role in helping this autonomous check, and is a typical example of Toyota's "Visual Control System."

Global adaptation

Since Toyota production system has been created from actual practices in the factories of Toyota, it has a strong feature of emphasising practical effects, and actual practice and implication over theoretical analysis. This system can play a great role in the task of improving the constitutions of the companies world-wide(especially those of the automobile industry.

Toyota Motor Corporation is a leading automobile company throughout the entire world. Toyota has a strong commitment to diversity. It is an integral aspect of Toyota's success. The Toyota Motor Corporation understands that to continue to be successful in this day and age they must take further steps to diversify their company.

Toyota Motor Corporation is one of the world‘s leading automakers, offering a full range of models, from mini vehicles to large trucks, and even new concept cars. Key competitors of Toyota include Nissan, Diamler Chrysler, Chevrolet, General Motors, and GMC.

Although Toyota experiences worldwide successes, they are constantly looking for new ways to branch out and reach minorities and ethnic groups. During the week of April 6,2005 Toyota launched a Spanish-language digital game on the Spanish edition of their website. This is the first interactive game available on the Spanish-language website. This new interactive activity is a good way for Toyota to enhance their image as well as reach a younger Hispanic market. It also allows Toyota to keep a constant communication process with consumers. This new game reaches those who are not effectively reached by existing television and print ads. In addition this new game will not only offer a form of entertainment but it will get more people to visit the Toyota site Toyota is promoting this new game by using banner ads on high-traffic Spanish language outlets and web sites. The game is titled "El Invicto" and is an interactive soccer game, where players defend their Corollas with one of three different goalkeepers. All of the goalkeepers are of a Hispanic background.

Toyota is one of the more innovative companies targeting a Hispanic market using online entertainment. This new game is an excellent source of support for the Corolla Hispanic TV and print executions using the same theme "El amor por el Corolla puede lograr cosas increibles" (love for Corolla can make incredible things happen.) According to data from auto researcher R.L. Polk and Co., the Corolla is the best selling US passenger car among Hispanics. A lot of young Hispanics surf the net. More than 35% of that demographic has a household income of more than $60,000. These are people that the Toyota Motor company try to target effectively.

I think this new form of interactive media is an excellent idea from the people at Toyota. The internet is being increasingly popular, especially among a younger population. This new form of advertising will effectively reach the target market. It is a good way to allow current and prospective buyers to take a closer look at Toyotas Spanish-language website.

Toyota Financial Services (TFS) recently undertook a major business transition programme to in-source its back-office functions. This required that a large number of Toyota and Lexus retail finance contracts, together with all their associated transaction data, be converted from an external IBM mainframe-based system to an in-house system. The new system was based on the Lynx "Portfolio" software package using Unix and Oracle technology. ATD consultants worked closely with TFS throughout the data conversion project in the following roles:

• contributing to a feasibility study into the risks and benefits of undertaking a data conversion from the outsourced external system, and presenting the findings of the study to the TFS management board, which approved the data conversion project

• managing the data conversion project from the start, through to its successful conclusion 18 months later

• acting as the principal contacts with both the existing external system supplier (Black Horse) and the suppliers of the new in-house system, for the resolution of technical and data-related issues

• support for the transition of the business to an in-house operation, particularly through the provision of management information from the source data

• data analysis, data mapping, design of the migration procedures and development of migration software

• unit and system testing of the data migration procedures and software, as well as support for user acceptance testing

• development of procedures for both the financial and non-financial reconciliation of the data conversion.

The director of the transition programme was Blair Pollock, TFS' General Manager, Business .

Toyota's Global Marketing Strategies

Americans loves big houses and big cars and that's why main players in car making industry (US based) such as GM, Ford and Chrysler were manufacturing big cars with high fuel consumptions. On the other hand the Japanese automakers are doing fine with the boosting market share in US as climbing oil prices make fuel efficient models such as Toyota Corolla and Honda Civic increasingly attractive. With the lead of Toyota, Japanese companies started to provide economy cars with basic needs of the driver in order to reach firstly to middle class, because the middle class is the majority in the social hierarchy.

Today, Toyota is recognised not only from middle class, it has loyalty from every segments of the society in all around the world. One of the reason is, Toyota is offering products to all types of market. Lexus for

luxury choice, Matrix for youngsters, Prius for family car, Trucks for mainly for US and 4 x 4 for adventurers and many more. The main similarity of these cars is reliability. Toyota have built up great loyalty with its customers by offering them moderate price cars with high tech developments such as ABS brake systems, side-impact and head-curtain air bags, anti-skid control; shortly any technological development that car manufacturers are offering also addition with fuel efficient motors. Toyota is likely to continue to get a big lift from the growing global interest in fuel efficiency. The sale of hybrid version of Camry is getting a lot of interest in US.

Briefly Toyota is aiming cost effective productions with JIT system, which has lately started in China and all around the world. Additionally the products which are offered are high tech developed with high reliability with moderate pricing than its counterparts.

JIT – Just In Time

Toyota is the benchmark in manufacturing and product development in automobile industry. The early adoption of JIT principles by Toyota seemed to have helped the company to achieve significant success. It helped the company respond quickly to changing customer needs and offer high quality products at low costs, thus increasing customer satisfaction. JIT system is Toyota's greatest asset in global market competition that other leading automakers like Mercedes-Benz, Honda and Chrysler excelled in advanced engineering techniques, engine technology and styling, they did not match Toyota in efficiency, productivity and quality.

JIT was used not only in manufacturing but also in product development, supplier relations and distribution. Despite imitating Toyota's JIT for many years, no other automaker in the world had been able to make their production systems and processes as efficient as Toyota had done.

The beginning of the system goes to late 30`s when Kiichiro Toyoda (the founder of Toyota) devised a system wherein each process in the assembly line of production would produce only the number of parts needed at the next step on the production line, which made logistics management easier as material was procured according to consumption.

This system was referred to as Just-in-Time (JIT) within the Toyota Group. The JIT production was defined as 'producing only necessary units in a necessary quantity at a necessary time resulting in decreased excess inventories and excess workforce, thereby increasing productivity.'

Lean Production

The famous Lean production techniques were originally developed by Toyota as a route to cost-effective mass-customisation. The key principles include cutting waste in all parts of the value chain and giving every worker the right to stop the production line when he or she finds a mistake. Rather than reworking individual cars, Toyota workers are allowed to stop production and work together to fix the underlying problem. Toyota created a value chain of linked suppliers, all of whom have a clear stake in making the company more successful and they all continue to enjoy the rewards of the greater efficiencies brought about by Lean production system.

PR – PUBLIC RELATIONS

Go Green, Go Green

Toyota Motor Corporation, Japan's number one carmaker, has a driving ambition to become greener. The company makes a hybrid-powered (gas and electric) sedan -- the Prius -- that is being snap up in US and European markets. Its gas-powered cars, pickups, minivans, and SUVs include such models as Camry, Corolla, 4Runner, Land Cruiser, Sienna, the luxury Lexus line, the new Scion brand, and a full-sized pickup truck, the V-8 Tundra.

"Until we find another planet earth that seems like a pretty good solution"

This advertisement message released when Toyota first introduced its hybrid cars. Toyota significantly aiming to attract their potential buyers by offering higher technology, the Prius hybrid-electric car, with cleaner emissions, which results greener company. On the other hand there are some mixed images on people mind. According to an article from Business Week (28.10.06) Toyota has increased its investments on truck factory in US and Lexus, luxury model, sales has boost up. In other words, Toyota is just as responsible in many ways as Ford, General Motors, and Chrysler when it comes to pollution and burning up gasoline. Its total fuel-economy performance is still strong, but has dropped as the company has sold more trucks. Toyota is not just building its new image to be environmentally friendly. The company wants to market the hybrid models as powerful cars in the market share as its other models that get fairly good mileage. With today's gas prices, the marketing strategy seems very smart but it can not be accepted as it is a green company.

F1 Heats up

Toyota entered F1 in 2002 season with the first race in Australia in order to be more competitive against its rival competitors on car manufacturing industry. Until that day Toyota was manufacturing some fast cars but it was mostly known as economical car producer. The company signed its name as the fastest car contender in the most elegant, respectful and followed car racing competition. Maybe there has not been achieved so many success from the F1 Toyota team but the purpose of entering every race not only wining the titles. It is also representing the name of Toyota in one of the most prestigious motor racing event.

It's a Goooooooooool

Toyota also signed its name on one of the great football stadium in Japan, which has finished in 2001. Though its capacity, at 45,000, is slightly less than some of the other grounds in Japan, which were used for the World Cup 2002. It was a misfortune that this facility lost out its chance to host matches because of a smaller capacity. Again sponsoring in a football stadium aimed to create an image of supporting sports, healthy life and with its design it is reflecting an image of high tech car company can also build a high tech stadium as a monument for Japanese nation. The upsetting side is if they have designed for couple thousand seats more, they might also reach other nations minds during the World cup series.

New Marketing Tools

"Some marketers have worked to make their brand messages so enjoyable that consumers might see them as entertainment instead of an intrusion." (Global Brands 2005) For instance, Toyota is not spending its budget for dull and bulk advertisements on TV in order to persuade its target market, it is trying to create a strong brand image by doing reality show "The Contender" rather than just lending support during commercial breaks. According to Global Brands 2005, Toyota, "whose brand value rose 10%, paid $16 million to have its vehicles be part of the storyline on NBC reality show The Contender, about small-time boxers competing for a nationally televised bout, The grand prize: a million dollars and a Toyota truck." On the other hand rival Nissan has increased its sales up 13% by parking Titan pickups in front of houses in hit ABC show Desperate Housewives. These approaches have seen in the past, which have worked for its purpose. Aston Martin and Omega in James Bond, Coca Cola and Mc Donald's in

World Cup football competitions and many more appeared in special events or occasions in order to increase public awareness about their products.

Growing Negative PR

Every story is not supporting Toyota's success. Toyota is facing a sexual harassment lawsuit in the U.S. filed against Hidetaka Otaka, who has since stepped down as the president and chief executive of Toyota's U.S. unit. In May, the company's U.S. chief Hideaki Otaka became front-page news after his former executive assistant Sayaka Kobayashi launched a $196 million sexual harassment lawsuit against him. (BusinessWeek.com, 20/07/06, Troubles Can't Stop Toyota's Growth) Hideaki Otaka denies the allegations.

Then, in June 2006 Toyota has faced its own troubles, including increasing numbers of recalls partially due to its efforts to cut costs by using the same parts across different models. Toyota announced it was recalling 986,000 cars, including 170,000 Prius hybrids sold in the U.S. due to a faulty steering component (Business Week 19.07.2006, The Most Recalled Cars 2006). Afterwards just after Nissan and Renault began seeking alliance talks with GM, police in Japan filed a complaint against three Toyota executives, accusing them of delaying the recall of faulty Hilux SUV models for eight years after discovering a problem with defective relay rods in 1996. Also Japanese authorities have launched a criminal investigation into three Toyota officials suspected of failing to do anything about a faulty steering part, which may have caused a 2004 head-on accident that injured five people.

Despite public relations setbacks Toyota is controlling majority of the market in the U.S., Toyota's relentless grabbing of the Big Three's market share, if anything, is intensifying. In the first half of 2006, Toyota sales were up 9.8% compared to a year ago. That compares to declines of 12% at GM, 3.9% at Ford, and 5.7% at Nissan. (Business Week – 19.07.06)

TOYOTA AS A BRAND:

The positioning of a brand is done keeping in mind where the company wants the people to see the

brand and where exactly do they want the brand to go. The positioning is an important part of the

Global Vision of the company.

Toyota’s Brand Communication talks about “Moving Forward”

This tagline embodies the spirit of constant innovation on the part of Toyota. It lends the associations of

quality and technological capability to the brand.

In India Toyota has a tagline “Quality Revolution” which signifies unmatched quality.

Toyota Brand Positioning:

• Majestic

• Quality

• Commitment to improving society

• Innovation in Technology

Toyota Brand Image:

People associate Toyota with:

• Quality

• Value for money

• Ecofriendly

The reasons for its success could be attributed to the following factors:

• Successful brand - Toyota has developed a trusted brand based on quality, good performance and

for being environmentally friendly.

• Innovation - Toyota is at the forefront of car manufacturing innovation. It was the first car

manufacturer to embrace lean manufacturing (known as Toyota Production System) which is a faster,

more efficient process which leads to less waste compared to the traditional batch and queue method

of manufacturing. It also applied JIT (Just in Time manufacturing) and smart automation. Toyota has

moved to a global manufacturing model. It successfully localizes the production to cut costs.

• Product Development - Key to the success in the car market is new models, which stimulate

demand and loyalty to the Toyota brand. Toyota has reputation for producing cars that are greener,

more fuel efficient, and of good performance. Toyota has sought to meet government requirements (for

reducing the impact on the environment), economic changes (as prices of fuel - oil continues to rise)

through the development of hybrid fuels. Toyota was the first car manufacturer to market hybrid (gas

and electric) fuel, with the launch of Prius model, ahead of competitors.

• Market Focused Strategy - Toyota has different strategies for different markets Eg: In the

developing Asian markets, it relies on affordable cars and Multi Utility vehicles. Whereas, in a market

like North America, new product launches have been key as innovation is a motivating factor for people

to buy products and for the company to stay ahead of its competition. The European Market, on the

other hand is heavily dependent on Integrated Manufacturing and Marketing.

• It successfully created iconic independent brands such as the Corolla, Camry and Land Cruiser; and

innovated them in order to maintain their brand equity.

• It has also created successful brand extensions such as Lexus in order to widen its portfolio

Toyota’s Brand positioning of quality is reinforced by the long list of brand surveys and quality awards it

has received the world over:

The J.D Power and Associates Quality Survey 2009:

The results showed Toyota’s dominance, with 10 autos rated as the best in 18 different vehicle

categories of the survey. Toyota had the least problems per hundred vehicles and ranked higher than

GM and Ford.

TOYOTA BRAND PORFOLIO ANALYSIS

Toyota’s Product Portfolio: India

Toyota Corolla

Toyota Camry

Toyota Innova

Toyota’s Product Portfolio: International

Toyota Prius

Toyota Land Cruiser

Toyota Yaris

Toyota Hilux

We will be focusing on the Indian brand portfolio of Toyota.

SEGMENTATION http://www.pakwheels.com/new-cars/pricelist

SEGMENT TOYOTA COMPETITORS

Segment1 ( Rs. 3-5 lakhs) Entry level small car

No offering Maruti AltoTata Indica

Segment 2 (Rs 5-7 lakhs)Premium hatchbacks

No offering Maruti SwiftSkoda Fabia

Segment 3 (Rs 7-10 lakhs) Compact sedans

Toyota Corolla Honda CivicChevrolet Optra

Segment 4(Rs 15-20 lakhs)Executive sedans

Toyota Camry Honda AccordFord Mondeo

Segment 5(Rs 5-7 lakhs)Multi Purpose Vehicle

Toyota Innova Chevrolet TaveraMahindra Scorpio

Segment 6(Rs 20 lakhs plus): SUV/ Pick up truck

No offering Mitsubishi PajeroMercedes M class

From the above table, it is clear that Toyota does not have any offering in the small car either in

segment 1 or 2 as these are the fastest growing segments in the Indian market. That is where the

growth and volumes would come from. Also, it should avoid introducing high end luxury models in India

under brand Toyota, as Toyota is worldwide known for value-for-money and not ultra luxury.

BRAND ARCHITECTURE:

Brand architecture is the structure of brands within an organizational entity. It is the way in which the

brands within a company’s portfolio are related to, and differentiated from, one another. The

architecture should define the different leagues of branding within the organization; how the corporate

brand and sub-brands relate to and support each other; and how the sub-brands reflect or reinforce the

core purpose of the corporate brand to which they belong.

TOYOTA COROLLA

Toyota Corolla follows Endorser Brand Architecture; here by looking at the rear view of the vehicle,

Mother Brand is on level with Daughter Brand i.e. Corolla. Now it can be easily communicated that

Toyota wishes to endorse this Brand as its reputation gets transferred to Brand Corolla. Toyota is known

for quality and has established this reputation all across globe. Hence, Endorsement Brand Strategy is

best suitable for Corolla.

TOYOTA CAMRY

Individual branding, also called individual product branding or multi-branding, is the marketing strategy

of giving each product in a portfolio its own unique brand name. This contrasts with branding,

corporate, and umbrella branding in which the products in a product line are given a single overarching

brand name. The advantage of individual branding is that each product has an image and identity that is

unique. This facilitates the positioning of each product, by allowing a firm to position its brands

differently.

Toyota Camry is having Individual Product Branding as we see the rear side of the vehicle, we will find

Camry written on the left hand side, where as the mother brand Toyota is not there, Camry comes under

Luxury Brand and having its own brand Identity. Hence, Individual Product Branding is best in case of

Camry.

TOYOTA INNOVA

Toyota Innova follows endorsement Brand strategy, where in Mother Brand is written on the side and

daughter brand is written at the rear end of the vehicle.

Now it can be easily communicated that Toyota wishes to endorse this Brand as its reputation gets

transferred to Brand Corolla. Toyota is known for quality and has established this reputation all across

globe. Hence, Endorsement Brand Strategy is best suitable for Innova.

BRAND POSITIONING AND IMAGE

TOYOTA COROLLA

The Corolla is a line of compact/ sub compact cars manufactured by Toyota. For the Pakistani market, it

is positioned in the B+/ C segment. It has become very popular throughout the world since the

nameplate was first introduced in 1966. In 1997, the Corolla became the best selling nameplate in the

world, with over 35 million sold as of 2007. Over the past 40 years, one Corolla car has been sold on

average every 40 seconds. The series has undergone several major redesigns. The Corolla is currently in

its 10th generation.

BRAND PERSONALITY:

The key behavioral traits that define the Corolla’s personality are:

• Safe

• Dependable

• Elegant

BRAND POSITIONING:

The Corolla is positioned as the best compact sedan. In the Indian market, it is positioned as a safe,

advanced and spacious car with a superior driving experience.

BRAND IMAGE:

In the dipstick study that we conducted, its brand image was found to be:

• A very reliable car that is an all rounder

• A low maintainance and it for a hassle free owner experience

• A value for money with its sufficient power and decent looks

• It is image is that of being a bit unexciting and plain

TOYOTA CAMRY

Toyota Camry as a brand has been around for more than 28 years and has undergone six generation

changes. It has grown from a basic family car into a more sporty, powerful and luxurious one over the

generations. It is the largest selling sedan in the US and it retains its unique proposition of technological

innovation along with affordable luxury.

BRAND PERSONALITY:

The key behavioral traits that define the Camry’s personality are:

• Stylish

• Powerful

• Sophisticated

• Plush

BRAND POSITIONING:

The Toyota Camry as a brand has been around for more than 28 years and had undergone 6 generation

changes. It is positioned as a technologically advanced, powerful and stylish luxury sedan in the Pakistani

market. It’s positioning in the luxury segment has a good value proposition wherein it is priced much

below competitors like Mercedes and BMW in the same segment and on par with models from Honda

and Ford.

BRAND IMAGE:

In the dipstick study that we conducted, its brand image was found to be:

• Performance Luxury sedan

• Style statement

• Technology packed

Here, we see that the brand positioning and image match to a great extent.

TOYOTA INNOVA

Toyota Innova is a Multi utility vehicle (MUV) manufactured by Toyota for the Asian market. It was

launched in India in March 2005 as a replacement for Toyota Qualis. INNOVA is one of 5-IMV models

that have been designed as part of the IMV (Innovative International Multi-purpose Vehicle) project.

Toyota Innova sales account for around 43% of the total MPV vehicles sold in June 2005

BRAND PERSONALITY:

The key behavioural traits that define the Camry’s personality are:

• Versatile

• Sturdy –Go Anywhere

• Trendy

BRAND POSITIONING:

The basic positioning of Innova is as a getaway vehicle that is spacious, trendy and up market. It is

positioned as a vehicle for all purposes. Amir Khan has been roped in to endorse this brand and this is a

good move as the car talks about different roles to play and being good in every role, which is Amir

Khan’s forte as an actor. The brand uses the tagline “All you desire” and the ads are also catchy. Innova

has tried to distance itself from the Qualis, its successful predecessor which was popular as a Taxi by

playing the refinement card.

BRAND IMAGE:

In the dipstick study that we conducted, its brand image was found to be:

• Spacious and sturdy vehicle

• Car level comfort and refinement

• Multi purpose family vehicle

• Tourist vehicle / Taxi

Here we see that the brand image matches the positioning in three aspects. The only mismatch is that

because of its seating capacity and value for money, it’s use as a taxi is rising which is changing brand

image a bit.

• COMPITITORS ANALYSIS

Toyota’s main competitors in India are General Motors, Honda and Ford. There are a large number of offerings in every segment in which Toyota has a presence. At a time when the domestic car market was growing at an average of 14 per cent per annum, the Indian subsidiary of the world’s largest car maker had been consistently losing market share — from 4.5 per cent in 2004 to 3.6 per cent in 2007 and 3.4 per cent in 2008. Toyota has set a target of capturing 10% of the Indian market share by 2015. Honda, General Motors (GM) and Volkswagen have also set their target in the Indian market at 10 per cent. Whether Toyota ever gets there will actually depend on how smartly it can avoid repeating the mistakes it made in the decade when it was learning about the market.

Both the Corolla Altis and the Innova, being value cars in South Asian markets, are selling at a premium here because only 56 per cent of the manufacturing cost of these cars is met by local supplies. But that is a specious argument since rival Honda has similar local content. Toyota in India experimented so heavily with its price positioning that it lost track of its objectives. Somewhere along the way, the world’s most trusted value-for-money brand in cars repositioned itself as a premium brand in India — and failed.

FOLLOWING IS A LIST OF BRANDS AVAILABLE IN INDIA AT VARIOUS PRICE RANGES.

Under Rs. 3 Lakhs

• Maruti 800, Maruti Alto, Omni

• Reva

• Tata Nano

Rs. 3-5 Lakhs

• Ambassador

• Chevrolet Aveo U-VA, Chevrolet Spark, Chevrolet Opel Corsa

• Fiat Palio

• Ford Fiesta, Ford Icon

• Hyundai Santro, Hyundai i10, Hyundai Getz

• Maruti Zen, Maruti Wagon R, Maruti Versa, Maruti Esteem, Maruti Gypsy, Maruti Suzuki A-Star, Maruti Suzuki Zen Estilo, Maruti Suzuki Swift, Maruti Suzuki Ritz New, Mahindra Logan

• Tata Indigo XL, Indigo Marina

• Tata Indica, Tata Indigo CS

Rs. 5-10 Lakhs

• Chevrolet Swing, Chevrolet Aveo, Chevrolet Tavera, Chevrolet Optra Magnum

• Fiat Linea, Fiat Adventure, Fiat Grande Punto, Ford Fusion

• Hyundai Accent, Hyundai Elantra, Hyundai i20, Hyundai Verna, Hyundai Sonata Embera

• Honda City ZX, Honda Jazz New

• Maruti Baleno, Maruti Suzuki Sx4, Maruti Suzuki Swift Dzire

• Mahindra Scorpio, Mahindra Bolero, Mahindra Xylo

• Mitsubishi Lancer, Mitsubishi Cedia

• Toyota Innova

• Tata Sumo Victa, Tata Sumo Grande, Tata Safari

• Skoda Fabia

Rs. 10-15 Lakhs

• Chevrolet Forester

• Ford Mondeo, Ford Endeavour, Ford Focus

• Honda Civic

• Skoda Octavia & Combi

• Toyota Corolla, Toyota Corolla Altis

• Tata Indicruz New

• Volkswagen Jetta

Rs. 15-30 Lakh

• Audi A4

• Chevrolet Captiva

• Honda CR-V, Honda CRV 2008, Honda Civic Hybrid, Honda Accord, Hyundai Santa Fe New

• Maruti Suzuki Grand Vitara, Mitsubishi Pajero, Mercedes C Class

• New Skoda Superb New, Skoda Laura

• Opel Vectra

• Toyota Camry, Toyota Fortuner New

• Ford Endeavour Thunder Plus, Terracan & Tucson

• Volkswagen Passat , Volkswagen Jetta

Rs. 30-90 Lakhs

• Audi A6, A8 & Audi TT, AUDI Q7

• BMW X5, 5 Series & 7 Series

• Mitsubishi Montero, Mercedes Benz S-Class, Mercedes E Class, S Class, SLK, SL & CLS-Class

• Porsche Boxster, Cayenne, 911 Carrera & Cayman S

• Toyota Prado

• Volvo Xc90, Volvo S80

Above Rs. 1 Crore

• AUDI R8

• Bentley Arnage, Bentley Continental GT & Flying Spur, Bentley Azure

• Maybach

• Rolls Royce Phantom

Currently, Toyota does not have any offering in the small car segment. It needs to now focus on the small car segment (under Rs. 5 lakh) as this is the segment which is the fastest growing in the Indian market. That is where the growth and volumes would come from. Also, it should avoid introducing high end luxury models in India under brand Toyota, as Toyota is worldwide known for value-for-money and not ultra luxury.

MAIN COMPETITORS FOR THREE OF TOYOTA’S OFFERINGS IN INDIA ARE:

Toyota Innova Corolla Camry

Tata Sumo/Safari

Mahindra Xylo/Scorpio

General Motors Chevrolet Tavera Chevrolet Optra

Skoda Octavia

Honda Civic Accord

VW Jetta Passat

Ford Focus (planned)Mondeo

Hyundai Sonata

Even as Toyota is expanding its capacity at the Bidadi facility from 77,000 units per annum to 147,000 units by 2011 to accommodate a small car, rivals Suzuki and Hyundai have already built capacities of 800,000 and 300,000 and created a strong foothold in India. Although it is banking heavily on the small car, Toyota’s offering may hit the market after Honda, GM, Volkswagen and Ford — all of whom have advanced considerably in their launch plans.

COMPETITOR POSITIONING

Toyota Brands Competitor Brands Competitor Positioning

Innova Tata Sumo Grande The low cost yet stylish, family utility vehicle.

Tata Safari The premium off-road SUV for people longing to break free from the frustrating trappings of the rat race, to reclaim their lives. Big as a beast, 4 wheel drive to take on any terrain, no sedan with its elegant contours, no small car with its tall boy design can credibly claim such an edgy positioning.

Mahindra Scorpio/Xylo An MUV/SUV but positioned as a stylish family car

Chevrolet Tavera An MUV positioned as a comfortable family car, but mainly used as a commercial vehicle.

Corolla Honda Civic A rolling showcase for Honda innovation and engineering expertise. It constantly raises the bar that others have tried to achieve and consistently shows up on "Car of the Year," "Best of" and "Top 10" lists. It is positioned as a luxury executive car.

Chevrolet OptraA powerful luxury car for the young, successful, upwardly mobile Indian professionals

Skoda Octavia The strongly built, powerful, driver’s car, positioned in the luxury segment.

Camry Honda Accord Grand size, sleek styling, combined with Honda’s engineering excellence; Accord is counted as one of the most reliable cars. This makes it a tough competitor in the mid-size luxury segment.

Hyundai Sonata Positioned as a premium sedan with luxurious features, but failed to make a mark as, in India, Hyundai is still perceived as a low cost small car maker.

VW Passat Internationally VW is a mass market brand, but in India, it is positioned as a premium brand, and Passat belongs to the prestigious luxury car segment dominated by BMW and Mercedes.

Ford Mondeo Ford, which uses a Source Branding formula, portrays Mondeo as a powerful, fun to drive, sporty luxury car with superb handling.

• PRODUCT LIFE CYCLE

Toyota Innova and Prius are in Growth phase. Hence they require Investment and growth opportunities are high for both of them, by looking at the position of Innova and Prius, it can be concluded that Prius already started to move towards Cash Cow and hence its growth rate will be stagnant.

Where as in case of Innova , it requires investment and still time for it to move to become Cash Cow.

If we talk about Corolla and Camry, they themselves are established brand in the market and hence require no expense for its sales. Even the Growth opportunities for both the brands are Limited. They are in stagnant phase of the life cycle and thus generating Revenue for Toyota.

Brand equity is considered a key indicator of the state of health of a brand, and its monitoring is believed to be an essential step in effective brand management (Aaker, 1991, 1992). Both researchers (e.g. Shocker et al., 1994) and practitioners (e.g. Biel, 1992) have argued for the importance of understanding the concept of brand equity. Country of origin is another important variable influencing consumer perceptions of brands (Hulland, 1999) and brand images (Ahmed et al., 2002). In the present study, consistent with the definition offered by Thakor and Katsanis (1997, pp. 79-80), country of origin is defined as “the country in which the product is made”[1]. The impact of country of origin on consumer perceptions or evaluations of products is called the “country of origin effect” (Samiee, 1994). Researchers have suggested that country of origin effects may impact the equity of certain brands (e.g. Thakor and Katsanis, 1997). For example, Aaker (1991) and Keller (1993) both argued that country of origin could affect a brand's equity by generating secondary associations for the brand. Indeed, even a foreign-sounding name is known to affect a brand's equity (Leclerc et al., 1994).

Increasingly, and for a variety of reasons, brands from one country are being made available to consumers in other countries (Shocker et al., 1994). In such instances, international marketers need to understand the sources of the equity of their brands. Some researchers have realized this and advocate

extending the international consumer research scope to include brand equity (Wang, 1996). For example, measurement of brand equity across international boundaries is essential if brand managers are “to manage and control brand equity effectively” (Shocker et al., 1994, p. 156).

There is prolific research in both the areas of country of origin effects and brand equity. However, brand equity remains a complex phenomenon in the international context (Onkvisit and Shaw, 1989). Brand equity has been conceptualized as a multidimensional construct (e.g. Aaker, 1991), and the impact of country of origin on some of its components (e.g. perceived quality) has been widely researched in the marketing literature (see Chao, 1998). However, no empirical research to date has evaluated how country of origin may affect brand equity. This paper aims to fill this gap in the international context. More specifically, this research aims to develop a better understanding of the effect of country of origin on brand equity.

Background and justification for the present research

A better understanding of the linkages between brand equity and country of origin is important for a number of reasons. For example, researchers have advocated that managers need to maintain the “core essence of a brand” in their international branding decisions (de Chernatony et al., 1995). “The ‘essence’ of the brand is a single simple value, easily understood and valued by consumer” (Arnold, 1992, p. 17). When brands are competing in the international arena, marketing managers should understand how to maintain the core essence of their brand across international boundaries. Examining how country of origin impacts brand equity and its associated dimensions (e.g. perceived quality, brand associations) should reveal the means to protect or enhance the core essence of a brand.

The country of origin of a product is an important marketing element known to influence consumer perceptions as well as behavior. An improved understanding of how country of origin information influences brand equity is also valuable to marketing practitioners, for whom “quantification of brand equity” and “identification of elements that are likely to impact changes in consumer behavior and lead to changes in brand equity” are two important issues (Biel, 1993, p. 77).

The literature does not provide a satisfactory explanation for the factors influencing brand equity in the international context. Despite exhaustive research on brand equity over the past few decades, the marketing literature does not fully explain how a change in the country of origin of a brand would affect its consumer-based equity. Neither is it clear whether the impact of country of origin on the consumer-based equity of a brand would be product-category specific. The goal of this paper, therefore, is to examine and elucidate the potential relationships between country of origin and consumer-based brand

equity. More specifically, the main objective of the present study is to identify empirically possible differences in consumer-based brand equity, according to the country where the product is made.

Key variables and constructs

Consumer-based brand equity

In this paper, we conceptualize brand equity in accordance with Aaker (1991) and Keller (1993), using a consumer (or marketing) perspective (as opposed to a financial one). Brand equity is therefore referred to as consumer-based brand equity and defined as “the value consumers associate with a brand, as reflected in the dimensions of brand awareness, brand associations, perceived quality and brand loyalty”. This definition was adapted from Aaker (1991, p. 15). Aaker defined brand equity as a set of assets (or liabilities), and found brand awareness, brand associations, perceived quality and brand loyalty to be its four most important dimensions from a consumer perspective. Some empirical evidence supports the notion that these four are distinct dimensions of consumer-based brand equity. As per Aaker, we define brand awareness as “the ability of a potential buyer to recognize or recall that a brand is a member of a certain product category. A link between product class and brand is involved” (p. 61). We define a brand association as “anything linked to the memory of a brand” (Aaker, 1991, p. 109). Perceived quality is defined as the “customer's perception of the overall quality or superiority of a product or service with respect to its intended purpose relative to alternatives” in this study, as per Aaker (1991, p. 85). According to Aaker, perceived quality is not just another brand association but an association that is elevated to the status of a separate dimension of brand equity. However, whereas Aaker treated brand loyalty as a behavioral dimension, we conceptualize it as an attitudinal dimension and define it as “the tendency to be loyal to a focal brand, which is demonstrated by the intention to buy the brand as a primary choice” (Yoo and Donthu, 2001, p. 3).

“Product category-country” associations

Consumers have associations toward entities such as products, places, brands and countries of origin. These associations can have direction and strength. For example, Farquhar and Herr (1993) argued that product category-brand associations can be bi-directional. That is, consumers may recall a product category when they think of a brand name and they may recall a brand name when they think of a product category. Product category-country associations, which refer to consumers' ability to evoke a country when the product category is mentioned, are of interest when examining the relationships between country of origin and consumer-based brand equity. Since consumers are known to associate countries with certain product categories and vice versa (Terpstra and Sarathy, 2000), consumers' “product category-country” associations appear to be bi-directional.

Conceptual development and hypotheses

In this study, country of origin and product category are the independent variables of interest. Consumer-based brand equity is hypothesized as a four-dimensional construct, as shown in the large rectangle in Figure 1. Each of the consumer-based brand equity dimensions is a dependent variable in the framework expected to be affected by country of origin. Since the proposed model is being tested for two product categories, product category is also included as an independent variable in the design so that the effect of the country of origin variable could be teased out. Moreover, consumers' product category-country associations are believed to moderate the effect of the country of origin on consumer-based brand equity dimensions, as indicated by the dotted line in Figure 1.

Country of origin and consumer-based brand equity

The associative network memory model (Anderson, 1993) provides a good basis for explaining the relationships between country-of-origin and consumer-based brand equity. Both Aaker (1991) and Keller (1993) used the associative network memory model to explain consumers' brand associations and the notion of brand equity.

The country of origin of a product is an extrinsic cue (Thorelli et al., 1989), which, similar to brand name, is known to influence consumers' perceptions and to lead consumers to cognitive elaboration (Hong and Wyer, 1989). Country of origin is known to lead to associations in the minds of consumers (Aaker, 1991; Keller, 1993). For example, consumers might associate the countries France and Spain with the intangible attributes “reliability” and “durability”, to a different degree. These country of origin associations of consumers could therefore influence the consumer-based equity dimensions of a brand from a specific country.

Researchers have argued that country of origin effects may be part of the brand equity of certain names (Shocker et al., 1994, p. 150). For brands offered in the international arena, such as Japanese brands available to consumers in Australia, consumer-based equity should be influenced by the very fact that the brand's country of origin is Japan. Consumer perceptions of Japanese brands have improved over the years (Kamins and Nagashima, 1995). Furthermore, brand names such as Sony or Toyota clearly signal their country of origin to consumers. Such origin cues are similarly entrenched within many well-known brand names (Phau and Prendergast, 1999).

Conversely, an inferior country of origin could tarnish a brand name (Thakor and Katsanis, 1997). That is, if the country of origin of a brand were to change from a country towards which consumers have favorable associations (e.g. the USA), to a country towards which consumers have less favorable associations (e.g. Mexico), the brand names in question could be tarnished and the consumer-based equity of these brands erodes. For example, Johansson and Nebenzahl (1986) found that Japanese brands of automobiles (Honda/Mazda) made in Korea/Mexico/The Philippines lost their attractiveness compared to when they were made in Japan. Similarly, Nebenzahl and Jaffe (1996) found that Sony (in the product category VCRs) suffered erosion in its brand image when made in countries such as the former USSR/Poland/Hungary. This discussion leads to the following general hypothesis:H1. In a given product category, the consumer-based equity of a brand varies significantly according to the country of

origin of the brand. Given that consumer-based brand equity is conceptualized as a four-dimensional construct, this general hypothesis can be subdivided into more micro-related predictions. However, no hypothesis was made in the present study regarding the impact of the country of origin on the brand awareness component of consumer-based brand equity, since it would be difficult to manipulate experimentally consumers' mindset with respect to brand awareness. For example, asking consumers if they were aware of the brand Honda (without providing the country of origin), to test for their brand awareness level and then to respond to the hypothetical case of a product carrying the brand Honda but made in the USA (or some other country) would create demand artefacts. In addition, consumers are known to associate a brand with its home country even when the country of origin information is not made available to them.

On the other hand, a brand could generate and leverage secondary associations from an array of entities. For example, people, places and events could be linked to a brand (Keller, 1993) and generate secondary associations. According to Aaker (1991), country of origin associations are one such type of consumers' brand associations. Similarly, Keller (1993) argued that consumers' country of origin associations serve as secondary associations to their brand associations. Brand associations are supposed to contribute to brand equity when consumers are aware of the brand and hold “strong, favorable and unique brand associations” in their minds (Keller, 1999, p. 2). Rossiter and Percy (1987) suggested that secondary associations should be emphasized in marketing communications based upon consumers' awareness, beliefs and attitudes of the concerned people, places or events. The inference is that favorable secondary associations are beneficial to the brands. Keller (1993) also argued that favorable associations contribute to the equity of a brand. If consumers' country of origin associations serve as secondary associations, they should influence brand associations, and therefore brand equity, leading to the following hypothesis:H1a. In a given product category, brand associations vary significantly according to the country of origin of the brand. A number of researchers have established that country of origin influences perception of quality of products (e.g. Heslop et al., 1987; Kaynak and Cavusgil, 1983). Perceived quality (Zeithaml, 1988) is a key dimension of brand equity (Aaker, 1991), believed to enhance the value of the brand by providing consumers with a reason to buy. We hypothesize that country of origin information affects the perceived quality of products. That is, consumers are likely to hold favorable perceptions of the quality of a brand when the brand is known to originate from countries with a strong association with the product category compared to when the brand is known to originate from countries with weaker association with the product category. We expect that the perceived quality levels of a brand will vary by the country of origin of the brand. That is, the perceived quality level of Ericsson made in Sweden is likely to be higher than the perceived quality level of Ericsson made in Mexico or Hungary, for the product category “mobile phones”. Furthermore, consumers' perception of the quality of products is known to be product-category specific (Kaynak and Cavusgil, 1983). Hence, our third hypothesis can be stated as follows:H1b. In a given product category, perceived quality varies significantly according to the country of origin of the brand. The extant literature does not provide much insight into the relationship between country of origin and brand loyalty. However, we argue that country of origin could affect the brand loyalty component of a brand's equity. Brand loyalty in the present study is defined as consumers' intention to buy a brand as a primary choice. Consumers may prefer a brand based partly on its country of origin. This might be because

consumers have experienced, or are convinced about, either the features or attributes or benefits offered by the brand (e.g. Nike) originating from the particular country (USA). Therefore, it can be argued that, similar to brand loyalty, consumers may exhibit country loyalty. Moreover, country of origin effects in one product category are known to transfer to new product categories offered from the same country (Agarwal and Sikri, 1996). It is hypothesized, therefore, that country of origin affects consumers' loyalty towards a brand.H1c. In a given product category, brand loyalty varies significantly according to the country of origin of the brand. Furthermore, consumers' product category-country associations are believed to moderate the effect of the country of origin on consumer-based brand equity dimensions. For example, the consumer-based equity of a brand made in a country with strong product category-country associations (e.g. car/Germany) is likely to be substantially higher than that for the same brand made in a country with weaker product category-country associations (e.g. car/Mexico), in cases where consumers perceive substantive differences between the two countries in terms of their product category-country associations. The empirical study designed to examine the proposed model is described in the next section of this paper.

Method

Research design and procedures

A cross-sectional mall intercept survey was used to collect the data. A total of 672 responses was collected through systematic sampling from a busy shopping mall in an Australian state capital city. The questionnaire used as the data collection instrument included an experimental design. A doubly multivariate design was employed for examining the differences in consumer-based brand equity across three different countries of origin. The model was tested using two product categories: cars and televisions. That is, country of origin (three levels) and product category (two levels) were the two between-subjects factors and brand name (three levels) was the within-subjects factor: the three levels were nested within each product category (i.e. Toyota, Mitsubishi and Suzuki were nested within cars; Sony, Toshiba and Hitachi were nested within televisions). The unit of analysis was the individual consumer.

Since country-of-origin perceptions are known to vary by consumers' home country, we needed respondents who were born in Australia or who had lived in Australia for a considerable period of time. The population was defined as “people in the age group of 18 to 70 who were born in Australia or who have stayed in Australia for more than one year and have used products in the relevant category (televisions or cars)”. All respondents had used products in the category they were exposed to (televisions or cars). The majority of the sample (92.5 percent) had lived in Australia for five or more years and met this condition, with more than 82 percent of the sample living in Australia for 15 or more years.

Of the 672 completed questionnaires obtained, 75 were found to be incomplete and consequently discarded. Of the remaining 597 questionnaires, a further 58 were from respondents not born in

Australia or who had not lived in Australia for at least one year. These respondents were also eliminated from the analysis, yielding a final sample of 539.

Data collection instrument and measures

The survey questionnaire included three sections. Section one of the questionnaire comprised two questions, aimed at capturing respondents' product category-country associations. Respondents were asked to list the names of (a maximum of six) countries that came to their mind when they thought of a given product category (cars or televisions). Respondents had the option to say that no countries came to their mind when thinking of the given product category. The order in which the respondents listed the countries was used as the basis for computing a product category-country association (PCCA) rating for each of the countries mentioned by the respondents. The countries were then ranked, based on their PCCA rating.

Section two of the questionnaire included items measuring various dimensions of consumer-based brand equity, namely brand awareness, brand associations, perceived quality and brand loyalty (see the Appendix). Measures for brand equity used in the present study were compiled from the literature (e.g. Aaker, 1991, 1996, 1997; Yoo et al., 2000; Yoo and Donthu, 2001). For example, aided recall and unaided recall were used as measures for brand awareness. Brand personality (e.g. sincerity and excitement) and organizational associations (e.g. liking and trust) were used as the measures for brand associations. That is, one of the questions required respondents to rate the statement “I trust brand X”, on a scale of 1 to 11. Measures for perceived quality were adapted from Aaker (1991). For example, respondents were asked to rate the statement “Brand X is reliable”, on a scale of 1 to 11. Measures for attitudinal brand loyalty were also adapted from the literature. For example, respondents were asked to rate the statement “Brand X would be my first choice” on a scale of 1 to 11. These measures had been empirically tested and employed in earlier studies (e.g. Cobb-Walgren et al., 1995; Yoo and Donthu, 2001). Each item had the verbal anchors “strongly disagree” and “strongly agree” for the 1 and 11 scale points.

Demographic questions (e.g. respondent age, gender, country of birth and length of stay in Australia) were included in section three of the questionnaire. To improve readability and understanding, the questionnaire was pre-tested using a judgment sample of actual consumers, and was subsequently revised. Three different versions of the questionnaire (one for each of the three countries) were designed for each of the product categories included in the study. For a given product category, questions in all sections were identical in each of the three versions of the questionnaire, except for the section on brand equity. Each respondent completed only one version of the questionnaire.

Dependent variables

The four consumer-based brand equity dimensions served as the dependent variables. Confirmatory factor analysis (CFA), used to establish the dimensionality of consumer-based brand equity, supported the hypothesized four-dimensional model[2]. The multi-dimensional consumer-based brand equity construct exhibited convergent, discriminant and construct validity. The parameter estimates of the

measurement model showed that all indicator variables loaded their hypothesized factors (e.g. consumer-based brand equity dimensions) in a statistically significant manner .

CONCLUSION AND RECOMMENDATIONS

The era of building brands namely through mass media advertising is over. The predominant thinking of the world's most successful brand builders these days is not so much the old game of reach (how many consumers see my ad) and frequency (how often do they see it), but rather finding ways to get consumers to invite brands into their lives. The mass media won't disappear as a tool. But smart companies see the game today as making bold statements in design and wooing consumers by integrating messages so closely into entertainment that the two are all but indistinguishable.

Non Automotive Activities:

Aerospace

Toyota is a minority shareholder in Mitsubishi Aircraft Corporation, having invested

US$67.2 million in the new venture which will produce the Mitsubishi Regional Jet, slated for

first deliveries in 2013. Toyota has also studied participation in the general aviation market and

contracted with Scaled Composites to produce a proof-of-concept aircraft, the TAA-1 in 2002.

Philanthropy

The Toyota Municipal Museum of Art in Aichi, sponsored by the manufacturer. Toyota is

supporter of the Toyota Family Literacy Program along with National Center for Family

Literacy, helping low-income community members for education, United Negro College Fund

(40 annual scholarships), National Underground Railroad Freedom Center (US$1 million)

among others. Toyota created the Toyota USA Foundation.

Higher education

Toyota established the Toyota Technological Institute in 1981, as Sakichi Toyoda had planned to

establish a university as soon as he and Toyota became successful. Toyota Technological

Institute founded the Toyota Technological Institute at Chicago in 2003. Toyota is supporter of

the "Toyota Driving Expectations Program," "Toyota Youth for Understanding Summer

Exchange Scholarship Program," "Toyota International Teacher Program," "Toyota

TAPESTRY," "Toyota Community Scholars" (scholarship for high school students), "United

States Hispanic Chamber of Commerce Internship Program," and "Toyota Funded Scholarship."

It has contributed to a number of local education and scholarship programs for the University of

Kentucky, Indiana, and others.

Robotics

In 2004, Toyota showcased its trumpet-playing robot. Toyota has been developing multitask

robots destined for elderly care, manufacturing, and entertainment. A specific example of

Toyota's involvement in robotics for the elderly is the Brain Machine Interface. Designed for use

with wheelchairs, it "allows a person to control an electric wheelchair accurately, almost in real-

time", with his mind. The thought controls allow the wheelchair to go left, right and forward with

a delay between thought and movement of just 125 milliseconds.

Finance

Toyota Financial Services Corporation provides financing to Toyota customers.

Agricultural biotechnology

Toyota invests in several small start-up businesses and partnerships in biotechnology, including:

P.T. Toyota Bio Indonesia in Lampung, Indonesia

Australian Afforestation Pty. Ltd. in Western Australia and Southern Australia

Toyota Floritech Co., Ltd. in Rokkasho-Mura, Kamikita District, Aomori Prefecture

Sichuan Toyota Nitan Development Co., Ltd. in Sichuan, China

Toyota Roof Garden Corporation in Miyoshi-Cho, Aichi Prefecture

CSR INITIATIVES

Environment:

Information concerning activities related to the environment including the development of

environmentally considerate vehicles and environmental preservation activities to combat global

warming.

Basic Stance on the Environment

Global Warming Prevention Initiatives

Environmentally Considerate Automobile Manufacturing

"Sustainable Plant" Activities

Automobile Recycling

Environmental Conservation Initiatives

Triffic Safety:

Toyota’s comprehensive activities seeking the complete elimination of traffic casualties through

the development of even safer vehicles, education of drivers and pedestrians, and proposals for

the creation of safe traffic environments.

Initiatives designed to educate people on traffic safety

Pursuing a higher level of vehicle safety

Participating in the creation of a safe traffic environment

Social Contribution:

Toyota conducts vigorous activities tailored to the needs of society using its resources, such as

the technology and expertise it possesses in the areas of the environment, traffic safety,

education, the arts, culture, and community care.

Environment

Traffic Safety

Human Resources Development

Arts and Culture

Harmonious Society

Volunteer Activities

FINANCIALS

Total Sales by Region:

Revenue ¥ 18.9 trillion (FY2010)

Operating income ¥ 147.5 billion (FY2010)

Net income ¥ 209.4 billion (FY2010)

Total assets ¥ 30.3 trillion (FY2010)

Total equity ¥ 10.3 trillion (FY2010)