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Toyota Motor Corporation is a Japanese multinational manufacturer headquartered in Toyota, Aichi, Japan. In 2017, Toyota's corporate structure consisted of 364,445 employees worldwide and, as of December 2019, was the tenth-largest company in the world by revenue.
Toyota is the largest automobile manufacturer in Japan, and the second-largest in the world behind Volkswagen, based on 2018 unit sales. Toyota was the world's first automobile manufacturer to produce more than 10 million vehicles per year, which it has done since 2012, when it also reported the production of its 200 millionth vehicle.
Toyota Motor - Company Highlights
- Startup Name-Toyota Motor Corporation
- Headquarters-Toyota City, Japan
- Founders-Kiichiro Toyoda
- Founded-August 28, 1937
- CEO-Akio Toyoda
Toyota Motor - About and How it works?
Toyota Motor Corporation (Toyota), incorporated on August 27, 1937, conducts business in the automotive industry. The Company also conducts business in finance and other industries. The Company's segments include Automotive, Financial Services and others. Toyota sells its vehicles in approximately 190 countries and regions. Toyota's markets for its automobiles are Japan, North America, Europe and Asia.
Toyota produces automobiles, and related parts and components through approximately 50 overseas manufacturing companies in over 30 countries and regions besides Japan. Toyota's manufacturing facilities include plants in Japan, the United States, Canada, the United Kingdom, France, Turkey, Thailand, China, Taiwan, India, Indonesia, South Africa, Australia, Argentina and Brazil.
The Company's Financial Services segment consists of providing financing to dealers and their customers for the purchase or lease of Toyota vehicles. Toyota's financial services also provide retail instalment credit and leasing through the purchase of instalment and lease contracts originated by Toyota dealers. Toyota's subsidiary, Toyota operates financial services companies in approximately 40 countries and regions, which support its automotive operations across the globe. Toyota Motor Credit Corporation is Toyota's principal financial services subsidiary in the United States.
The other segment includes the design, manufacturing and sale of housing, telecommunications and other businesses. Its information technology related businesses include a Web portal for automobile information.
Toyota Motor - Logo and its meaning
The overlapping of the two perpendicular ovals inside the outer oval symbolize “T” for Toyota, as well as a steering wheel, representing the vehicle itself. The outer oval symbolizes the world embracing Toyota.
Toyota Motor - Founder and History
Kiichiro Toyoda is the founder of Toyota Motor.
Founder of Toyota Motor Corporation
In 1933 Toyoda Kiichiro founded what later became the Toyota Motor Corporation as a division of the Toyoda Automatic Loom Works, Ltd. (later Toyota Industries Corporation, now a subsidiary), a Japanese manufacturer founded by his father, Toyoda Sakichi.
Its first production car, the Model AA sedan, was released in 1936. The following year the division was incorporated as the Toyota Motor Company, Ltd., headed by Kiichiro. (The company’s name was changed to Toyota, which has a more pleasing sound in Japanese.) Toyota subsequently established several related companies, including Toyoda Machine Works, Ltd. (1941), and Toyota Auto Body, Ltd. (1945).
Toyota Motor - Mission
Toyota’s corporate mission is “to make ever-better cars, to build a future where everyone has the freedom to move.” This mission statement is a combination of the company’s official statements regarding the mission of its business: “to build a future where everyone has the freedom to move” and “to make ever-better cars.” Toyota’s corporate mission statement has the following key elements that reflect the enterprise and the purpose and goals of its business:
- Make ever-better cars
- Build an inclusive future
- Freedom to move for everyone
Toyota Motor - Business Model
Toyota’s operation has been analysed based on those 4Vs below :
Volume of Processes : Toyota manufactures numerous vehicles (8,736.5 thousand units in 2012, Toyota Production figures) and for such high output, there’s greater degree of repeatability in the process. The high volume of output has allowed Toyota in systematization of activities and Toyota believes in developing deep expertise in specialities among its workforce as an essential requirement to its product-development system. Such high volume process output helps Toyota gain economies of scale and thus reduces the unit cost of its production.
Variety of Processes : Toyota carefully chooses a variety to balance market demands and operational efficiency. The company is present in all the segments of automotive and at least 70 different models of vehicles are sold by Toyota (Automotive, 2014) making the portfolio with a wide range of products and this accounts for a higher variety of processes. High variety of processes enables Toyota to match a wider range of customer demands and be more flexible in the eyes of customers. This, however, accounts for higher unit costs and makes the process relatively complex but Toyota has advanced other productions methods to control such aspects.
Variation of Processes : With predictably constant demand, it’s easier to allocate resources to a level that is capable of meeting the demand Slack et al. (2012). The variation in demand for Toyota’s products is low in the past few years and the company’s production has integrated Just in Time production techniques to fulfil those demands. Low variation enables Toyota to implement stable, routine and predictable operation processes.
Visibility of Processes : Process visibility indicates how much of the processes are exposed to its customers Slack et al. (2012). Toyota has low process visibility, as most of its operation process is ‘factory-like’. Low process visibility means there’s a time lag between production and consumption of Toyota products but it enables the company for high staff utilization and enjoys low unit cost for its products. Few of its processes such as those of sales centre and test drive facilities, however, have some kind of contact with customers allowing limited visibility.
Toyota Motor - Revenue and Growth
The Toyota Motor Corporation's net revenue contracted by one percent year-on-year and dipped to just under 30 trillion Japanese yen in the fiscal year ended March 2020. This figure is approximately equal to 278 billion U.S. dollars. Toyota's revenue for the twelve months ending September 30, 2020 was $241.196B, a 13.59% decline year-over-year.
Year Annual Revenue Percentage change
2019 $272.031B +2.88%
2018 $264.416B +3.02%
Toyota Motor - Funding and Investors
Toyota Motor Corporation has raised a total of $243.6M in funding over 2 rounds. Their latest funding was raised on Jun 28, 2018 from a Post-IPO Equity round.
Toyota Motor - Investments
Toyota Motor Corporation has made 27 investments. Their most recent investment was on Feb 25, 2020, when Pony.ai raised $462M.
Toyota Motor - Acquisitions
Toyota Motor Corporation has acquired 3 organizations. Their most recent acquisition was Daihatsu on Feb 12, 2016.
Toyota Motor - Competitors
Toyota Motor Corporation's top competitors include FCA US, Mitsubishi Motors, Opel, Volkswagen, Nissan USA, PSA Group, Hyundai Motor, BMW Group, Ford Motor, General Motors and Daimler.
Toyota Motor - Challenges Faced
Toyota’s sales in its home market are going through a phase of stagnation.
Any weakness in the Japanese yen provides a competitive advantage to Toyota’s overseas business. Therefore, the company’s margins from the overseas business are highly dependent on the currency movement of the Japanese yen against major currencies, including the US dollar and the euro. Continuous strength in the yen against these currencies can significantly affect Toyota’s profitability.
Despite being an Asian automaker, Toyota is unable to stay ahead of GM in the Chinese market.
With increasing environmental awareness across the globe, a delay in Toyota’s ability to deliver mainstream eco-friendly vehicles may
Toyota Motor - Future Plans
The demand for electric and hybrid cars is growing vastly. You might have heard of the self-driving vehicles running on the roads these days. That is a rough example of what modern technology demands from the automakers. Inbuilt software running the automobile is the need of the hour. The automotive industries are now racing for innovations to keep up the repo in the market. The modern era is the time of transformation. And that is what Toyota is battling for.
The manufacturers now understand that electric cars are the future. The company is now designing special electric vehicles in a partnership with Subaru. Toyota now has the dedication to built electric cars. Toyota future plans will help to increase global sales. They are now in a joint venture with the various battery supplying companies.
They not only have to design electric vehicles but also have to match the market needs. Numerous electric car manufacturing vehicles are in this race. The demand for electric cars is increasing all around the globe. The experts working on Toyota future plans will have to put all efforts possible. It is so to increase sales and reach the set target.
The automakers are working on hybrid and plug-in hybrid models as well. According to industry knowledge, the count of electric vehicles will still be less than hybrid cars. Electric vehicles are not the only focus for the company. They also want to increase global sales in hybrid vehicles. The company will design and manufacture electric vehicles as per the market demands. But the game will still be on the hybrid and plug-in hybrid cars.