Carmakers Want Youths, Now by TCC Team (4/1/2002)
Toyota, the largest automaker in Asia, hopes to increase its global market share by 50 percent within the next ten years.
The Japanese automaker said in the new global vision statement it released last week that it expected to increase its global market share five points from 10 percent to 15 percent early in the 2010s. In 2001, Toyota's global market share hovered around 10 percent, while Ford's held around 12.8 percent and General Motors, the world's largest automaker, held 14.9 percent of the global market. Toyota's market share in the U.S. has generally tended to track the company's global market share.
Thus, the comparative numbers suggest the objective of Japan's number-one automaker is to become the world's largest car and truck company in less than a decade. In addition, if Toyota reaches its stated objective, it will also become the best-selling brand in the United States as well, replacing both Chevrolet and Ford at the top of the automotive heap. Toyota already is threatening to overtake Chrysler as the number-three seller of cars and trucks in the U.S.
Next month, Toyota is expected to post record earnings and clearly establish itself as the world's most profitable automaker.
Toyota spokesmen in the U.S. played down the implications of the Global Vision statement. "It's an update of something they've done before," said John McCandless, Toyota spokesman. But key rivals, such as General Motors and DaimlerChrysler, have complained repeatedly that Toyota is using Japan's economic problems to gain an advantage in the auto industry's ongoing battle for market share.
John Devine, who said recently that GM has no intention of dropping its continuing protests over the declining value of the yen, said the Japanese automakers, particularly Toyota and Honda, have taken advantage of the yen’s distressed value to add content and boost incentives.
Meanwhile, Toyota also is trying to address some of its most noticeable weaknesses, such as the company's history of uninspiring styling and a decidedly bland image among a rising generation of new car buyers.
"Toyota has positioned the early part of the 21st century as its 'Second Founding Period' and has been engaged in efforts to realize harmonious growth. But current conditions have convinced Toyota that it is now time to create new dreams for future growth and to determine the direction in which to proceed," the statement said.
"As nationalism steadily declines and respect for all peoples expand throughout the world, global companies are shifting to societies where people of a variety of nationalities and ethnicities can engage in lively exchanges of ideas. Toyota seeks to become a truly global enterprise that is respected by people around the world," the statement added.
Telematics and China, too
The Global Vision document emphasizes Toyota’s plans to lavish plenty of attention on issues such as recycling and telematics, or in-vehicle communications, in an effort to expand the automobile's appeal in new and emerging markets such as China. It's also planning to find new ways to use information technology to make its already efficient manufacturing processes even leaner.
Toyota also has a reputation for building the best cars in the world but other brands with good reputations have faltered. Mercedes-Benz has seen its reputation for quality dinged and dented recently. To that end, the Japanese auto giant finally acknowledged it had a serious quality problem on its hands and announced it planned to fix thousands of vehicles suffering from a sludge build-up in their engines.
Toyota officials said the company planned to extend the warranty on 1997-2001 Toyota and Lexus vehicles with the 3.0-liter V-6 and 2.2-liter four-cylinder engines to eight years — out into Hyundai and Chrysler territory.
The warranties are being backdated to the original date of purchase and some 3.3 million vehicles will be covered by the new policy. Up until now, Toyota has received more than 3,000 complaints of engine damage, according to one estimate.