SWOT analysis of Toyota

While talking about the best automobile maker in the world, Toyota will definitely take the leading place. Its founder Kichiro Toyoda founded the company in 1937. It was the spinoff of his father’s company named Toyota Industries. The headquarter of this automotive company is in Toyota, Japan (Aichi).

Toyota is a multinational automotive company that has become successful in gathering 338,875 employees within March 2014. Toyota has made and broken several records. It has become the number one company that has manufactured more than 10 million of cars every year from 2012.

It was only 2012 when Toyota announced that they had manufactured 200 million cars in that year. That is more than huge!

Table of Contents

Strengths in the SWOT analysis of Toyota

The strength of a business refers to the area which keeps it far ahead than its competitors. The strong points of Toyota in the automotive market are as follows-

Strong Human Resource– A Company needs skilled and professional human resource to grow bigger. Toyota is blessed with huge human power throughout the world. They have invested in getting resources, and the return they get is big. As of December 2015, they have 348,877 skilled human resources around the world.
Innovative Organizational Culture– While it comes to advanced operating system and functional strategies, Toyota will always be on the top. From widely practiced management system to lean manufacturing details, Toyota has set examples for the fellow companies.
Strong Brand Image– This is obviously one of the most important strong points of Toyota. Whenever people look for cars, they search for the brand name ‘Toyota,’ and that has kept them far ahead of their competitors.
Strong Diversified Portfolio– Cars means Toyota. They have a large number of varieties of their product. From electric cars to hybrid cars, Toyota has spread its wings to all types of cars in this market.
Advanced Technology– Toyota is not only a car manufacturing company, but they are also considered as an innovator. Their hi-fi technology has introduced hybrid cars in the market. The green vehicle technology of Toyota has been adorned by customers in large scale when they consider the environmental concern and price of petrol.
Global Supply Chain– They has outlets, branch companies, manufacturing factories around the world. The strong and global supply chain of Toyota is really one of the greatest strength of this company.
High Production Capability– Toyota is giving serious competition to its contemporaries on this point as they have a high production capacity of producing cars, almost 10 million per year.

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Weaknesses in the SWOT analysis of Toyota

Talking about the weaknesses of a business means the areas where it can improve a lot. These are the areas where the business has much to do with further improvement. The weak pointers of Toyota are as follows-

Dependence on Suppliers– as Toyota has suppliers around the world; they have to depend on them. It makes the production a bit sloth.
Not Grabbing Markets– Toyota has developed green vehicle technology, but it has been failed in grabbing the actual market where it would be implemented accurately. The market of China and India can be the best for launching these vehicles, but there is still time.
Negative Publicity– This happens due to large vehicle recalls. Any type of vehicle recalls affecting the automaker, and Toyota is no exception. Also, the recall rates are higher in Toyota, and that can cause more negative publicity.
Poor Brand Recognition– There are 4 different flagships of Toyota- Hino, Lexus, Daihatsu, and Among these, Lexus and Toyota have been successful in making the brand recognition.

Opportunities in the SWOT analysis of Toyota

Opportunities for a business refer to the areas which can be used to gain more revenues. The vital opportunities of Toyota are as follows-

The growth of Developing Nations– Perspectives is changing, and now, people are more inclined to buy cars. In the developing nations, the demand for cars is exuberating.
Green Vehicle Technology– Maybe slower, but the green vehicle technology is gaining popularity around the world. If Toyota focuses on this area, they will get much revenue from this innovation.
Growing Concern for Environmental Pollution– People, around the world, is getting more concerned about the environmental degradation and are also willing to do their bit. This is the high time to popularize Toyota’s environment-friendly.

Threats in the SWOT analysis of Toyota

These are the factors that can make a business face downturn if not taken care early. So, the potential threats of Toyota are as follows-

Number of Competitors– Toyota is competing with huge names in the market, like Volkswagen, Ford, Mitsubishi, and Hyundai. It makes quite hard to make strong feet in the market.
High-priced Raw Materials– As the cost of raw materials is increasing, that is also increasing the cost of the end product.
Lower Profits– The continuous threat of exchange rates is always there. When the revenues are sent back to Japan in the Yen that becomes quite lower profit in comparison to other currencies.