Automobile Companies
Automobile Companies
Automobile Companies
INTO
UNITED STATES
AUTOMOBILE INDUSTRY
Featuring
TOYOTA
VOLKSWAGEN
GENERAL MOTORS
NISSAN
FORD
A comparative study
on
featuring
Toyota
Volkswagen
General motors
Nissan
Ford
By
Bharat Reddy
MS (CSE)
Roll No: US207MGH00CSE79
PROJECT SUBMITTED IN PARTIAL FULFILMENT FOR THE
AWARD OF THE DEGREE OF
MASTERS IN SCIENCES
(2014-16)
Page Topic
1: Title
2: Name & details
3: TOC
4: Abstract
5: Introduction
sectors in most of the countries of the world keeps the wealth of the world community
continuously growing of not only developed countries but also undeveloped countries too. It
is a fact today that even communist countries are adopting the capitalism market model and
competing for a share in the global open markets. This resulted in countries developing their
good understanding of the benefits and challenges presented by the global free market
scenarios.
This research study aims to explore the factors that influence the adoption of global
free market strategies and the typical challenges a business is likely to face in implementing
them. My case study was conducted on five titan companies of United States automobile
industry featuring Toyoita, Volkswagen, General motors, Nissan, and Ford. This research
study report explores the technological, organizational and environmental factors that could
enhancements are identified as the key technological factors and complexity, compatibility
and security are found to be the key technological challenges faced by the business. The
factors and challenges identified in the study could be valuable for the planning, designing
manufacturing company. The study reports could provide the best guidance for business
The key argument put forward in this study is that global vision can be the primary
lever for competitive edge over the competitors in terms of business strategies, business
models, product brands, product pricing and human resources management. Any company
that seeks to retain its position as a global automobile manufacturing leader status for a long
period in retailing has always used innovative technologies as a aid to maintain its world
dominance.
at 1.13 billion count presently. Of all the countries in the world United States of America
stands as the biggest vehicle market with 1 : 1.3 ratio of human to car, the highest human to
car ratio in the world. Since the time automobiles were invented in the world, US has always
retained this first place both in manufacturing sector as well as in transportation sector. The
current automobile production stands at approximately over 340 million units per year. The
automobile manufacturing industry is divided into two sectors which are 1) Cars and 2) Light
transport vehicles (trucks). Cars are further divided based on their size as 1) Small 2) Medium
3) Luxury 4) Large. The three main companies which are the top automobile manufactures in
United States are General Motors with a market share of 17. 4%, followed by Ford with a
market share of 15. 4%, lastly Toyota with a market share of 15. 3%.
Developing countries like China, India, Brazil are boosting the world’s vehicle population
with China being the second largest vehicle manufacturer and utilize after United States.
American Vehicle manufacturing companies sell their products in the global market too with
Introduction:
manufacturer with its headquarters at Toyota, Aichi, Japan. Toyota Industries was a
Automatic loom manufacturing company. The present company was established by Kiichiro
Toyoda in 1937, as a child company from his father's company Toyota Industries to
manufacture automobiles. Forbes magazine has stated its commercial status as the 13th
largest company in the world by revenue and held Toyota as the world number one
automotive manufacturer position till the year 2012. It employs around 340,000 employees
worldwide and produces more than 10 million vehicles every year. Presently it is the world's
market leader in sales of hybrid electric vehicles (fuel +Electric). Toyota’s Prius family brand
is the world's top selling hybrid car with almost 5.7 million units sold worldwide as of 30
April 2016.(as per financial year end calculations). Presently it stands as the second largest
automotive manufactures and vehicle designer of the United States of America after General
Mission Statement:
To attract and attain customers with high-valued products and services and the most
Vision Statement:
A company’s organizational culture defines the responses of the mangement and employees
to challenges and competition the company faces in the market. As a global leader in the
automobile industry, Toyota uses its organizational culture to maximize human resource
capabilities in innovative designing, team work, problem solving quality checks and secrecy
a) Team work: Toyota uses teams of workers or managers in all its projects. They are
delegated right from the first phase of the project till the project completion. Toyota
believes that synergy of team work would bring greater success. Every employee of
Toyota has to undergo a mandatory team working and team building training
program.
b) Quality: being a Japanese company Toyota is highly quality conscious of all its
vehicle and products. The Toyota way of manufacturing results in creating quality
products the first time itself instead of rechecking and remanufacturing qualityless
products.
c) Secrecy: being a Japanese company Toyota has ingrained the Japanese culture of
secrecy in all of its company doctrine. This secrecy is however regional and all
matters of American branch of Toyota are settled in America unit itself. It does not
d) Innovative designing is a hallmark Toyota feature that provide maximum value to the
customer. Every employee and manager are trained to be both innovative and quality
conscious in everything they perform for the company. Creativity is the most
Strengths:
Toyota company has established its own manufacturing methodology called “Toyota way”
which ensures high global quality products in the first attempt itself through superior
production system.
Toyota pioneered innovative technologies like Hybrid vehicle in which sector it is now the
world leader
Toyota’s innovative design ensure a wide variety of vehicle models suited \for various
Toyota is global vehicle manufacturing company due to its quality and innovative products
line.
Weakness:
Toyota has presence and manufacturing units only in Japan and USA. It’s a market leader in
these countries but does not have presence in the lucrative Europe market, Middle east
Recall of vehicles due to faulty parts has undermined its\commercial image and dented its
profits
Opportunities:
Fastly developing markets of Middle East, Africa, Brazil, Russia, Argentina etc.,
Threats:
Sluggish global economy growth rate hampers the profits of Toyota in developed countries
market
Intensive competition from existing automobile manufactures like General Motors and from
Displayed below is the financial data of Toyota Company for the American branch only:
In Millions of USD (except for per 12 months ending 12 months ending 12 months ending 12 months ending
share items) 2015-12-31 2014-12-31 2013-12-31 2012-12-31
Revenue 149,558.00 144,077.00 146,917.00 133,559.00
Other Revenue, Total - - - -
Total Revenue 149,558.00 144,077.00 146,917.00 133,559.00
Cost of Revenue, Total 126,495.00 127,724.00 123,050.00 116,154.00
Gross Profit 23,063.00 16,353.00 23,867.00 17,405.00
Selling/General/Admin. Expenses, Total 14,999.00 15,716.00 10,850.00 11,529.00
Research & Development - - - -
Depreciation/Amortization - - - -
Interest Expense(Income) - Net
- - - -
Operating
Unusual Expense (Income) -1.00 132.00 18.00 0.00
Other Operating Expenses, Total 417.00 305.00 208.00 77.00
Total Operating Expense 141,910.00 143,877.00 134,126.00 127,760.00
Operating Income 7,648.00 200.00 12,791.00 5,799.00
Interest Income(Expense), Net Non-
- - - -
Operating
Gain (Loss) on Sale of Assets - - - -
Other, Net 959.00 869.00 875.00 709.00
Income Before Tax 10,252.00 1,234.00 14,371.00 7,638.00
Income After Tax 7,371.00 1,230.00 11,946.00 5,612.00
Minority Interest 2.00 1.00 7.00 1.00
Equity In Affiliates - - - -
Net Income Before Extra. Items 7,373.00 1,231.00 11,953.00 5,613.00
Accounting Change - - - -
Discontinued Operations - - - -
Extraordinary Item - - - -
Net Income 7,373.00 1,231.00 11,953.00 5,613.00
Preferred Dividends - - - -
Income Available to Common Excl. Extra
7,373.00 1,231.00 11,953.00 5,613.00
Items
Income Available to Common Incl. Extra
7,373.00 1,231.00 11,953.00 5,613.00
Items
Basic Weighted Average Shares - - - -
Basic EPS Excluding Extraordinary Items- - - -
Basic EPS Including Extraordinary Items - - - -
Dilution Adjustment 0.00 0.00 46.00 48.00
Diluted Weighted Average Shares 4,002.00 3,958.00 4,087.00 4,015.00
Diluted EPS Excluding Extraordinary
1.84 0.31 2.94 1.41
Items
Diluted EPS Including Extraordinary - - - -
In Millions of USD (except for per 12 months ending 12 months ending 12 months ending 12 months ending
share items) 2015-12-31 2014-12-31 2013-12-31 2012-12-31
Items
Dividends per Share - Common Stock
0.60 0.50 0.40 0.2
Primary Issue
Toyota Global Market share:
3) Toyota has a lineup of 108 models in its car and transport vehicle
4) Rapidly rising demand for Hybrid vehicles in all developed countries due to stringent
5) Hegemonic hold of automobile markets of Japan and USA which are world first and
6) Rapidly increase in demand for domestic cars in India and China as a status symbol
7) Increasing economy of many countries like Middle East emirates, Africa, Russia,
8) Fall of petrol and oil prices has also augmented the automobile industry.
9) Pricing structure of Toyota vehicle is very flexible and is augmented by major banks
and credit instructions like Master card, Visa, American express card etc.,
10) Assurance of Japanese technology, Japanese quality with Japanese service.
VOLKSWAGEN Company
Introduction:
Volkswagen group.. The present company was established by German Labour Front party in
1937, as a child company from his parent's company Volkswagen Group of Industries to
manufacture economic range automobiles. Forbes magazine has stated its commercial status
as the 61th largest company in the world by revenue and held Volkswagen as the world
number one automotive manufacturer position till the year 2013. It employs around 584,800
employees worldwide and produces more than 10 million vehicles every year. Presently it is
the world's market leader in sales of luxury cars and vehicles. Volkswagen parents company
owns the Luxury car brands like Porche, Audi, Bentley, Lamborghini, Skoda, SEAT, Bugatti
etc., Volkswagen Company’s Bugatti family brand is the world's costliest and fastest top
selling luxury car with almost 409 units sold worldwide as of 30 April 2016.(as per financial
year end calculations). Presently it stands as the first largest automotive manufactures and
vehicle designer of the United States of America with a yearly sale of 3 million vehicles and
Mission Statement:
The Volkswagen Group's of Industries chief goal is to offer attractive, economic, safe and
environmentally sound vehicles which can compete in an increasingly tough market and set
world standards in their respective class, both for their price and performance
Vision Statement:
To make world a mobile, sustainable place with access to all the citizens.
Organizational Culture:
A company’s organizational culture defines the responses of the mangement and employees
to challenges and competition the company faces in the market. As a global leader in the
human resource capabilities in innovative model designing, team based collaborative work,
and producing the worlds best and economic cars, it also provides the world best price
to value ratio and maintains the lowest pollution index for the society benefit.
b) Toyota uses teams of workers or managers in all its projects. They are delegated right
from the first phase of the project till the project completion. Toyota believes that
synergy of team work would bring greater success. Every employee of Toyota has to
conscious of all its vehicles and products. The Volkswagen Company way of
manufacturing “flow channel method” results in creating world class quality vehicles
and products very quickly and efficiently in the most economic ways.
the German culture of superiority in machine building into its company doctrine. This
policy denotes that Volkswagen Company product should be a world top standard for
continuos recepient of quality awards for its world standard products every year
e) Continuous development in all spheres of designing, production, workers, technology,
processes, marketing, training and sales are its another hallmark of corporate culture.
Volkswagen Company being a Germany based company has ingrained into itself the
German manufacturing methodology called “Iron and Blood” where synergy between
employees and manufacturing machines ensures high global top quality products
Volkswagen Company has established itself well into all emerging markets like Asia,
Africa, Brazil, Argentina etc., to provide a wide variety of vehicle models suited for
Weakness:
Mediocre customer loyalty and weak customer retention program has resulted in very
Recall of vehicles due to faulty parts and various legal cases has undermined its
Opportunities:
Very rapidly developing markets of India, Africa, Brazil, Russia and Argentina
Threats:
pollution.
vehicle.
2) Efficient and ergonomic design of vehicle to fit every transportation and travelling
3) Toyota has a lineup of 156 models in its car and transport vehicle
4) Hegemonic hold of automobile markets of Europe and USA which are world first and
5) Rapidly increase in demand for domestic cars in India and China as a status symbol
6) Increasing financial incomes of many countries like Middle East emirates, Africa,
Russia, Brazil, Argentine boosts Toyota car sales as a car is seen as a status symbol.
Introduction:
of its parent company General Motors Corporation.. The present company was established by
restructuring the bankrupt General Motors Corporation in 2009, as a child company from his
automobiles. Forbes magazine has stated its commercial status as the 1th largest company in
the world by value and held General Motors Company as the world number one automotive
0manufacturer position for 77 consecutive years till 2007. It employs around 232,800
employees worldwide and produces around 10 million vehicles every year from 400 facilities
worldwide. Presently it is the world's market leader in sales of all terrain cars and transport
vehicles. General Motors Company owns the Luxury car brands like Buick, Cadillac,
Chevrolet, GMC etc., General Motors Company’s Chevrolet family brand is the world's most
fuel efficient car brand with almost 164900 units sold worldwide as of 30 April 2016.(one
Chevy is old every 6. seconds). Presently it stands as the worlds largest automotive
manufactures and vehicle designer of the United States of America with a yearly sale of 3.2
million vehicles and global 9.8 million sales of vehicles in the world wide market.
Mission Statement:
The General Motors Company Group's of Industries chief goal is to “earn customers for
lifetime” by offering them world class quality vehicles in the domains of price, safety,
Vision Statement:
Organizational Culture:
A company’s organizational culture defines the responses of the mangement and employees
to challenges and competition the company faces in the market. As a global leader in the
automobile industry, General Motors Company uses its organizational culture to maximize
human resource and technology capabilities in innovative model designing, stringent quality
checks that are world top standard and global business success through customer retention.
a) Safety and quality first: General Motors Company’s core corporate principle is its
application of safety and quality first in all its manufacturing processes. It maintains
existing and innovative world top standards in all domains of its vehicle production
and maintainence..
b) Create lifelong customers: General Motors Company maintains its world number
creating lifelong customers by providing customers with world top quality vehicles
involves setting up local production centers in all the high volume markets of the
world that assure better and speedy market penetration. It also makes available all its
designing, manufacturing and testing technology to these countries. Apart from USA
it has manufacturing facilities in countries with China being its main customer.
d) Lead by example: Being a world titan in automobile manufacturing General Motors
Company has sent world records in innovative eco friendly designs, safety standards,
vehicle performance and price ratio.It has maintained its continuos recepient of
quality awards for its world standard quality products every yearas a proof of its
General Motors Company has a established worldwide goodwill which ensures that all of
General Motors Company pioneered the corporate to social responsibility schemes that
General Motors Company implements unique and novel testing and quality checks
Weakness:
General Motors Company market share has been declining due to unfocused product line
manufacturing of vehicles.
Recall of vehicles due to faulty parts has undermined its\commercial image and dented its
profits
Very high investments in producing SUV’s and transport trucks to cater to the developing
countries market
Opportunities:
Move the production facilities from USA to India and China to cut costs
Develop fuel efficient cars for developing markets of Middle East, Africa, Brazil, Russia,
Argentina etc.,
Expand their manufacturing and distribution centers to all parts of the world for greater
market penetration
Threats:
Sluggish global economy growth rate augmented with uncertain government policies
Nissan, Honda and from new entrants into Automobile industry like Tesla Motors
1) Worldwide best goodwill and corporate image of General Motors and their products. t
2) Vast variety of innovative vehicle models to suitt every transportation and travelling
need
3) General Motors Company has a lineup of 268 models in its car and transport vehicle
4) Rapidly rising demand for Luxury and Hybrid vehicles in all developed countries due
5) Hegemonic hold of automobile markets of China and USA which are world first and
6) Rapidly increase in demand for domestic cars in India and China where the middle
7) Increasing financial earnings of many countries like Middle East emirates, Africa,
8) Fall of petrol and oil prices has also further augmented the automobile industry sales.
Introduction:
with its headquarters at Nishi-Ku, Yokahoma, Japan. It is presently a subsidiary of its parent
company Renault Motors Corporation of France which holds 43% stake in Nissan and Nissan
holds 15% stake in Renault. A single CEO “Carlos Ghosn” heading both the companies.
Nissan Motors Company is the world’s first automobile pioneer company dealing with
transport automobile vehicles. The present company was established in 1933 by 3 automobile
engineers who created a brand called Datsun with their surnames. Nissan Motors Corporation
is a world leader in commercial, SUV and transport vehicles domain. Forbes magazine has
stated its commercial status as the 70th largest company in the world by value and held
Nissan Motors Company as the world best automotive transport vehicle manufacturer
position for consecutive years till 2005. It employs around 150,800 employees worldwide and
produces around 5 million vehicles every year from 108 facilities worldwide. Presently it is
the world's market leader in sales of all marine and transport vehicles and is the world’s sixth
largest vehicle manufacturer. Nissan Motors Company owns the Transport vehicle brands
like Datsun, Nissan, Infiniti and a testing brand called Nismo. Nissan Motors Company
Datsun family brand is the world's most sold transport car brand with almost 208490 units
sold worldwide as of 30 April 2016. Presently it stands as the world’s fourth largest
automotive manufactures and world number one transport vehicle manufacturer with a yearly
sale of global 2.4 million sales of vehicles in the world wide market.
The Nissan Motors Company chief mission and Vision states that “power comes within” and
believes that its employees are its core strength and all its success are a result of their team
work efforts and marketing strategies in developing markets like middle east, Africa, India
Organizational Culture:
A company’s organizational culture defines the responses of the mangement and employees
to challenges and competition the company faces in the market. As a global leader in the
transport automobile industry, Nissan Motors Company uses its organizational culture to
maximize human resource utilization and technology capabilities to create innovative hybrid
vehicle model designs, world standard quality checks, cross cultural production tie-ups,
satisfaction.
a) Cross cultural tie-ups: Nissan Motors Company’s core corporate principle is its
application of production tie-ups with big volume market countries local automobile
manufacturing companies like like Reanault, Ashok leyland, AutoViz etc., It belives
in the motto of “Diversity is strenght” and shares all its manufacturing, designing and
strategy is the primary cause for its world leader standards in transport domains both
b) Creative and Innovative vehicle models: Nissan Motors Company being a Japanese
company maintains its world number one transport vehicle manufacturer status by
applying its second core corporate principle of designing innovative and creative
vehicle model that are frugal and minimalistic in resource utilization but futuristic in
looks. It has a market leadership in hybrid passenger car and marine vehicle design
c) Local market productions: Nissan Motors Company owing to its low financial
centers in all the high volume markets of the world by tying up in joint production
with the local vehicle manufacturing companies, to reduce its production cost.
Strengths:
Nissan Company has established its own manufacturing methodology called “Nissan
way” which ensures high global quality products through frugal manufacturing processes.
Nissan Company pioneered innovative technologies like Hybrid, Hydrogen and electric
Nissan Company has a wide distribution and manufacturing network in USA and Asia.
Weakness:
Nissan Company has severe financial requirements for its operational needs in is into
billions of debt.
Does not have presence in the lucrative Europe market, Middle east market, Russian
It is a small company when compared with the world leaders in automobile industry but
Opportunities:
Very rapidly developing markets of India and China both for vehicle sales and
manufacturing facilities.
Fastly developing markets of Africa, Brazil, Russia, Argentina for vehicle sales.
Threats:
Sluggish global economy growth rate damps the profits of Nissan Company in most of
Severe competition from existing automobile manufacturing giants like General Motors
Uncertainty in world market due to sudden changes in economic situations and new
1) Superior Japanese quality of vehicle augmented with French technology that assure
2) Very innovative design of vehicle models to fit every transportation and travelling
need of customers.
4) Increasing demand for Hybrid vehicles in all developed countries due to stringent
5) Hegemonic hold of passenger automobile markets of Japan and USA which are world
6) Rapidly increase in demand for domestic cars for middle class families in India,
China, Middle East emirates, Africa, Russia, Brazil, Argentina as a status symbol.
7) Fall of petrol and oil prices has also augmented the automobile industry.
Financial Data of Nissan Company:
Introduction:
Ford Motors Company is a premier United States of America based multinational automotive
world’s first pioneer company dealing with large scale mass production of passenger and
transport vehicles. Ford Motors Company is the world’s first automobile pioneer companies
dealing with large scale human resources management with manufacturing facilities in USA
and Germany. The Germany based company was established to cater to the European market
and survived both the world wars. Ford Motors Corporation is a world leader in commercial,
SUV and luxury vehicles domains. Forbes magazine has stated its commercial status as the
40th largest company in the world by value and held Ford Motors Company as the world best
luxury passenger vehicle manufacturer position for 5 consecutive years till 2008(till Tata
company bought its Land rover and Jaguar brands). It employs around 213,800 employees
worldwide and produces around 5.6 million vehicles every year from 90 manufacturing
facilities worldwide. Presently it is the world's market leader in sales of all luxury and
commercial vehicles . Ford Motors Company owns the commercial and luxury vehicle brands
like Ford, Lincoln, Mustang etc., Ford Motors Company Lincoln brand is the world's most
sold luxury passenger car brand with almost 663,000 units sold worldwide as of 30 April
2016. Presently it stands as the world’s fifth largest automotive manufactures and world
number one passenger vehicle manufacturer with a yearly sale of global 5.4 million sales of
The Ford Motors Company chief mission and Vision states that “People working together as
a lean, global enterprise to make people’s lives better through automotive and mobility
leadership” and believes that its employees are its core strength for all of its success.
Organizational Culture:
A company’s organizational culture defines the responses of the mangement and employees
to challenges and competition the company faces in the global market. As a world leader in
the luxury and commercial automobile industry, Ford Motors Company uses its
technology capabilities to create innovative vehicle designs, cross cultural production tie-ups,
lean manufacturing process to sustain it’s global business leadership position in production
process and customer satisfaction. Ford’s organizational culture is defined by the company’s
One Ford plan, the following are its main characteristics of Ford’s corporate culture:
O: Own Working Together – Ford Company believes in the adage of “One Company,
One team”. Every company has a single goal, that is “Industry leadership”. Ford
Company belives that team work delivers it and trains all of its workers in both
R: Role Model Ford Values – Ford Company believes that the same values that
world wars and the great depression must me inculated in all employees and
D: Deliver Results- Ford Company its core values will maintain its unprecedented
global leadership while the technical and functional excellence of its employees and
manufacturing will deliver results that will stand as world standards for the industry.
Organizational Chart – Ford Motors company
SWOT analysis – Ford Motors company
Strengths:
Ford Company has pioneered its own manufacturing methodology called “Ford way”
which ensures high global quality products in the least production time.
Ford Company pioneered many innovative transport technologies like all terrain vehicle,
Ford Company is a global known vehicle manufacturing company due to its goodwill and
Weakness:
Ford Company has market presence and manufacturing units mostly in USA and China
only. It is a market leader in these countries but does not have presence in the lucrative
Recall of vehicles due to faulty parts has undermined its\commercial image and dented its
profits
Fuel to mileage ratio as well as the safety standards are very low compared to other
companies.
Opportunities:
Very rapidly developing markets of India and China, Middle East, Africa, Brazil, Russia,
Argentina etc.,
Threats:
Retarded global economy growth rate decreases the profits of Ford Company in its
Intensive competition from existing automobile manufacturing giants like General Motors
and even from new entrants into Automobile industry like Tesla
Uncertainty in world market due to rapid changes in economic situations and rising debt.
Major factors contributing to Toyota success:
1) Superior American quality of vehicle that assure value for money spent
3) Ford Company has a lineup of 238 models in its car and transport vehicle
4) Continuously increasing demand for Hybrid and electric vehicles in all developed
5) Hegemonic hold of automobile markets of China, Japan and USA which are world
6) Gradually increase in demand for domestic cars in India and China as a status symbol
7) Increasing financial growth of many countries like Middle East emirates, Africa,
8) Huge fall of petrol and oil prices has also augmented the automobile industry growth.
9) Ford Company pricing structure of vehicle is very flexible and is augmented by major
banks and credit instructions like Master card, Visa, American express card etc.,
leadership by a very huge margin over all of its competitors. The core reason for this
succesfull sales performance are due to its stringent safety standards and fuel to mileage
performance. It has morphed from a failed and debt ridden company to evolve as market titan
in the automobile Industry due to its adherence to the core value of customer satisfaction
through superior standards in safety and performance of its vehicles. The second runner up is
Ford Motors. Both the companies owe most of their success to the american market which is