How Did Toyota Company Establish In International Business

Professor Mirchandani
English 102
31 May 2012
“How did Toyota Company establish in International Business”

The Toyota Motor Corporation, Toyota, is a Japanese multinational company, which became a world's leading manufacturer of automobiles in 2007 rather than General Motors. The history of Toyota begins at the end of the 19th century, when Sakichi Toyoda invented the first automatic loom.Driven by the success of his looms, in 1907 founded the company Toyoda Automatic Loom Works. Captivated by the fledgling automotive industry, in 1929 Sakichi sold the rights to their patents of looms and invests those revenues in the development of the first Toyota vehicle. Kiichiro Toyoda, the son of Sakichi, founded in 1932 the Automotive Division of Toyota. Finally in 1937, Kiichiro producesthe first concept car and establishes the foundations of Toyota Motor Corporation Ltd, where it would later become part of the international business.

During the first seven years of operations, Toyota sold only 1,500 cars. But he had more success with the Sale of trucks. The operations of the Toyota grew when the Japanese government ruled that all manufacturers Cars should be in the handsof a majority Japanese. This ended with the importation of American vehicles to Japan. At the beginning of World War II, the Toyota concentrated its efforts in the military area. After the war, the Government of United States allowed the Toyota to manufacture again cars in Japan. It was then that the Toyota launched in Toyopet (their first economic car) in 1947.

At the end of the 1950s, theToyota sent three employees on a reconnaissance mission to the United States. The result was the opening of a small dealer south of California, which began selling the Toyopet crowns and a couple of models of trucks. According to Toyota Company History, "Enthusiasm turned to gloom when it was found that the Toyopet, a sturdy vehicle with quality features and room to spare, was woefully underpoweredand overpriced for the American market. Toyopet sales stalled and were discontinued in 1961."

Between the 1950s and the 1960s, the big three (General Motors, Ford and Chrysler) produced more than 90% of vehicles sold in United States. The Toyota sales were insignificant until the company began to design and produce cars specifically for the American market. In 1959, according toToyoland.com, "the company opened its first plant outside Japan - in Brazil. From that point on, Toyota maintained a philosophy of localizing both production and design of its products (that is, adapting vehicles to the places they will be used, as well as building them there)". Toyota is famous in the industry for its manufacturing philosophy, called the Toyota production system which has been adopted byseveral companies in the world.

Most of the companies are obsessed with the figures for the next quarter. On the other hand, when making decisions, the Toyota placed the look twenty-five years later. In most western companies, managers receive bonuses that depend on the quarterly dividend or annual dividend. Therefore, it is not surprising that they are willing to do everything possibleto take advantage of the latest novelty or trend favoured by consumers. Instead, Toyota executives always maintained a "long-presence" vision of the business. They feel less pressured in making more convenient products and, on the other hand, they do what it will work better in the long run.

For many years, Ford and General Motors have increased their volumes by unprofitable discounts. Forits part, the Toyota has always refused to do so; in exchange, Toyota ensures that its products depend completely on the real demand. Therefore, the Camry is today the number one in sales while various models of the Ford and GM no longer exist.

Also, Toyota has always operated with a production system which depends on what the customers want to buy. The other car manufacturers,...