BY

ARAVINDA S
1ST YEAR MBA .Asec

SUBMITTED TO
DR. VISWANATHAIAH
STATISTICS FOR MANAGEMENT
IFIM COLLEGE
TABLE OF CONTENTS
1 .INTRODUCTION
2 .LITERATURE REVIEW
3 .RESEARCH DESIGN
4. DATA ANALYSIS AND INTERPRETATION
5 .FINDINGS AND CONCLUSION
6 .SUGGESTIONS
7. REFERENCE
INTRODUCTION
Founded in 1937, Toyota Motor Corporation is a Japanese company that engages in the design,
manufacture, assembly, and sale of passenger cars, minivans, commercial vehicles, and related parts
and accessories primarily in Japan, North America, Europe, and Asia. Current brands include Toyota,
Lexus, Daihatsu and Hino. Toyota Motor Corporation is the leading auto manufacturer and the eighth
largest company in the world. As of March 31, 2013, Toyota Motor Corporation’s annual revenue was
$213 billion and it employed 333,498 people.

Toyota Motor Corporation competes in the automotive industry. The past five years were tumultuous
for automobile manufacturers. Skyrocketing fuel prices and growing environmental concerns have
shifted consumers' preferences away from fuel-guzzling pickup trucks to smaller, more fuel-efficient
cars. Some automakers embraced the change by expanding their small-car portfolios and diversifying
into the production of hybrid electric motor vehicles. Other automakers were more reluctant to shift
their focus from big to small cars, expecting the price of fuel to contract eventually, bringing consumers
back to the big-car fold. When fuel prices did fall during the second half of 2008, it was due to the US
financial crisis ripping through the global economy. This had a domino effect throughout the developed
and emerging worlds, with many Western nations following the United States into recession. Industry
revenue fell about 15.4% in 2009. 2 Pent-up demands will aid industry revenue growth, estimated at
2.1% in 2013, thus bringing overall revenue to an estimated $2.3 trillion. 3 Overall, the large declines
followed by recovery are expected to lend the industry average growth of 2.2% per year during the five
years to 2013. Throughout the past five years, growth in the BRIC countries supported production. Rising
income in these countries led to an increase in the demand for motor vehicles. Also, Western
automakers moved production facilities to BRIC countries to tap into these markets and benefit from
low-cost production. Over the next five years, the emerging economies will continue their growth, and
demand for motor vehicles in the Western world will recover. Industry revenue is forecast to grow an
annualized 2.5% to total an estimated $2.6 trillion over the five years to 2018

Worldwide automobile demand is tied to vehicle prices, per capita disposable income, fuel prices and
product innovation. On the supply end, vehicle prices stem from material and equipment costs, with
higher steel and plastic prices raising manufacturers' purchasing costs and, ultimately, retail prices.
During the past five years, automakers have been plagued with high steel and plastics prices, which have
raised manufacturing costs and product prices. On the demand side, per capita disposable incomes
determine affordability for consumers. As incomes increase, the propensity to purchase motor vehicles
increases as they become more affordable. Incentives are used to generate sales during periods of low
economic growth. Over the past five years, there has been a significant increase in the number of
automobile financing companies being established in the BRICs. This has resulted

the number and range of automobile loans increasing, which has contributed to stronger industry
demand. In the developed world, overall improved quality among most manufacturers has caused
buyers to feel freer to use price to differentiate similar products. Consumers are increasingly better
informed about a vehicle's actual cost and less likely to accept large annual price increases.
SWOT ANALYSYS
STRENGTH:
1. Strong market position and brand recognition: Toyota has a strong
market position in different geographies across the world. The company's market share for
Toyota and Lexus brands, (excluding mini vehicles) in Japan was 45.5% in FY2012. Similarly,
Toyota has a market share of 12.2% in North America, 13.4% market share in Asia (excluding
Japan and China), and 4.3% market share in Europe. In addition, the company holds a 7% share
of the Chinese market and a significant market share in South and Central America, Oceania,
Africa and the Middle East regions. Such strong market position allows the company to gain
competitive advantage and also expand into international markets. In addition, Toyota holds a
portfolio of strong brands in the automotive industry. Thus, the company's strong market
position gives it significant competitive advantage and helps it to register higher sales growth in
domestic and international markets.

2. Strong focus on R&D: Toyota has a strong focus on R&D to expand its product
portfolio and improve the functionality, quality; safety and environmental compatibility of its
products. The company's R&D efforts are directed at developing new products and processes
and improving the capabilities of existing products. The company conducts its R&D operations at
14 facilities worldwide. Strong focus on R&D has helped the company in incorporating newer
features to its existing range of products and also in bringing out latest technologies in the
varied areas. The company's strong focus on R&D allows it to uphold the technological
leadership in most of its product segments. It also enables Toyota to develop innovative
products, leading to strong sales.

3. Extensive production and distribution network: Toyota has an

extensive production and distribution network. Toyota and its affiliates produce automobiles
and related parts and components through more than 50 manufacturing companies in 27
countries and regions besides Japan. During FY2012, the company produced 7,435,781 vehicles,
including 3,940,000 vehicles in Japan and 3,495,000 vehicles across all other manufacturing
locations. In addition, Toyota has an extensive distribution network. While the company’s
geographically well spread production base diversifies business risks, its extensive distribution
network provides a wider reach, thus boosting revenues.

WEAKNESSES:
1.Product recalls could affect brand image: Toyota has conducted a number
of product recalls in the recent past, which could affect the brand image and overall sales of the
company. For instance, in 2011, Toyota recalled 111,000 models of Toyota and Lexus brands’ vehicles
due to the damage to elements of the substrate and potential shutdown of the hybrid system. Further in
the year, Toyota recalled 181,000 vehicles in Japan in relation to abnormal noise and oil leakage that
Analysis of Toyota Motor Corporation by Them may have resulted from slack of bolts in the sub
transmission and the rear wheel differential. In addition, the company was involved in government
investigations related to product recalls. For instance, in February 2012, the National Highway Traffic
Safety Administration initiated a preliminary investigation of a potentially faulty power window master
switch in the driver-side doors in model year 2007 Camry and RAV4 vehicles. This could also result in
significant penalties, which could affect the operational margins.

2. Declining sales in key geographic segments: Toyota witnessed a decline

in its sales in key geographic segments. In FY2012, the company witnessed declining sales across North
America, Asia, Europe and other geographic reasons, which together accounted for 60.8% of the total
revenues of the company. Thus, a continuous decline in the company's key geographic segments could
put pressure on the profit making segments and the overall revenues of Toyota.

3. Poor allocation of resources as compared to peers: Toyota has low

return on equity (ROE) and return on assets (ROA) compared to its peer companies. The company's
competitors such as Honda Motor and Nissan Motor have more ROE when compared to Toyota. Honda
Motor's ROE was 4.8%, while Nissan Motor's ROE was 8% in FY2012. In contrast, Toyota's ROE was 2.7%
in FY2012. Lower ROE and ROA compared to its peers indicates that the company is not using the
shareholders' money efficiently and that it is not generating high returns for its shareholders. Thus, poor
allocation of resources could hurt shareholder's value and confidence in the long term

OPPOURCHUNITIES:
1.Growing global automotive industry: The global automotive industry was
severely affected by the economic downturn, with a decline in revenues being recorded in 2008 and
2009. However, 2011 saw a strong rebound which has continued into 2012. According to MarketLine,
the global automotive manufacturing industry grew by 8.9% in 2012 to reach a value of $1,563.9 billion.
The recovery of global automotive industry thus provides Toyota an opportunity to gain more customers
and increase revenues

.2. Toyota poised to benefit from growing partnership

with BMW: Toyota is poised to benefit from the growing partnership with BMW. In June 2012,
BMW and Toyota signed a memorandum of understanding aimed at long-term strategic collaboration
on technological fields. As part of the agreement, the two companies will partner for the joint
development of a fuel cell system, joint development of architecture and components for a future
sports vehicle, collaboration on power-train electrification and joint research and development on
lightweight technologies. The growing partnership between the two companies is expected to boost the
technological know-how of the companies and may result in the development of new products thus
increasing revenues in the long run. Also, in the short run, the combined partnership will result in
significant synergies and cost-savings, boosting the operational margins.

3. Strong outlook for the global new car market: The global new cars
market has experienced moderate growth during 2008-2012. However, forecasts suggest this will
accelerate to strong double digit growth during the 2012-2016 periods. Thus, the strong outlook for the
global new car market coupled with the company’s new product launches provides a growth
opportunity for the company

THREATS:
1.Intense competition: The worldwide automotive market is highly competitive. Toyota
faces strong competition from automotive manufacturers in its various markets. The competition
among various auto players is likely to intensify in light of continuing globalization and consolidation in
the worldwide automotive industry. The factors impacting competition include product quality and
features, the amount of time required for innovation and development, pricing, reliability, safety, fuel
economy, customer service and financing terms. Increased competition may lead to lower vehicle unit
sales and large inventory, which may result in downward pricing pressure, thus impacting the financial
condition and results of operations of the company.

2. Appreciating Japanese Yen a major concern: Toyota is sensitive to the

fluctuations in foreign currency exchange rates and is principally exposed to fluctuations in the value of
the Japanese Yen, the US dollar and the Euro. The strengthening of the Japanese Yen against the US
dollar and fluctuations in foreign exchange rates would have a material adverse effect on Toyota's
reported operating results, which in turn would impact the valuation of the company.

3. Natural disasters could impact production structure: Toyota is

subject to disruption of production due to natural disasters such as earthquakes, floods, among others.
Toyota primarily operates in Japan which is a highest earthquake prone region in the world. The country
has witnessed many devastating earthquakes in the recent years which seriously disrupted the
economy. In 2011, the country witnessed one of the worst hit earthquakes in its history in the form of
2011 Tohoku earthquake, which led to a temporary production halt at its domestic auto manufacturing
facilities. In the same year, major floods occurred in Thailand which halted its operations and production
of about 150,000 Toyota automobiles. Such natural calamities, if occur frequently, could severely
influence the production output of the company due to work stoppages and in turn impact the overall
revenue base and profitability.
REVIEW OF LITERETURE:
The literature review was limited to articles available to the researcher using search terms
restricted to: lean manufacturing, lean production, lean thinking, lean and review, lean
and Toyota
Production System, lean assessment, lean culture, lean transformation …

“Everyone should tackle some great project at least once in their life. … should make an effort
to complete something that will benefit society.” Kiichiro Toyoda

Automobile Industry History : In the year 1769, a French engineer by the name of Nicolas J.
Cugnot invented the first automobile to run on roads. This automobile, in fact, was a self-
powered, three-wheeled, military tractor that made the use of a steam engine. The range of the
automobile, however, was very brief and at the most, it could only run at a stretch for fifteen
minutes. In addition, these automobiles were not fit for the roads as the steam engines made
them very heavy and large, and required ample starting time. Oliver Evans was the first to
design a steam engine driven automobile in the U.S. A Scotsman, Robert Anderson, was the
first to invent an electric carriage between 1832and 1839. However, Thomas Davenport of the
U.S.A. and Scotsman Robert Davidson were amongst the first to invent more applicable
automobiles, making use of non-recharge able electric batteries in 1842. Development of roads
made travelling comfortable and as a result, the short ranged, electric battery driven
automobiles were no more the best option for travelling over longer distances .The Automobile
Industry finally came of age with Henry Ford in 1914 for the bulk production of cars. This lead to
the development of the industry and it first begun in the assembly lines of his car factory. The
several methods adopted by Ford, made the new invention (that is, the car) popular amongst
the rich as well as the masses. According the History of Automobile Industry US, dominated the
automobile markets

RESEARCH OBJECTIVES:
1.To manufacture, sale, leasing and repair of motor vehicles, industrial vehicles, ships ,aircraft,
other transportation machinery and apparatus, space machinery and app rat us ,and parts
thereof

;2.To manufacture, sale, leasing and repair of industrial machinery and apparatus and other
general machinery and apparatus, and parts thereof;

3.To manufacture, sale, leasing and repair of electrical machinery and apparatus, and parts
thereof

;4.To manufacture, sale, leasing and repair of measuring machinery and apparatus, and
medical machinery and apparatus, and parts thereof

;5.To manufacture and sale of ceramics and products of synthetic resins, and materials thereof;
6.To manufacture, sale and repair of construction materials and equipment, furnishing sand
fixtures for residential buildings;

7.The planning, designing, supervision, execution and undertaking of construction works ,civil
engineering works, land development, urban development and regional development;

8.The sale, purchase, leasing, brokerage and management of real estate;

9.The service of information processing, information communications and , and the

development, sale and leasing of software;

10. The design and development of product sales systems that utilize networks such as the
Internet; sales, leasing, maintenance of computers included within such systems, and sales of
products by utilizing such systems

;11. The inland transportation, marine transportation, air transportation, stevedoring

,warehousing and tourism businesses;

12. The printing, publishing, advertising and publicity, general leasing, security and workers
dispatch businesses;

13. The credit card operations, purchase and sale of securities, investment consulting
,investment trust operation, and other financial services;

14. The operation and management of such facilities as parking lots, showrooms ,educational
facilities, medical care facilities, sports facilities, marinas, airfields, food and drink stands and
restaurants, lodging facilities, retail stores and others;15

. The non-life insurance agency business and life insurance agency business

;16. The production and processing by using biotechnology of agricultural products including
trees, and the sale of such products;

17. The sale of goods related to each of the preceding items and mineral oil;18. The conducting
of engineering, consulting, invention and research relating to each of the preceding items and
the utilization of such invention and research; and19. Any businesses incidental to or related to
any of the preceding it

RESEARCH METHODOLOGY:
Methodology

Research can be defined as “an activity that involves finding out, in a more or less
systematic way,)
“Methodology is the philosophical framework within which the research is conducted or
the foundation upon which the research is based” (Brown, 2006).
Research Methodology chapter of a research describes research methods, approaches and
designs in detail highlighting those used throughout the study, justifying my choice
through describing advantages and disadvantages of each approach and design taking into
account their practical applicability to our research.
O’Leary (2004, p.85) describes methodology as the framework which is associated with a
particular set of paradigmatic assumptions that we will use to conduct our research. Allan
and Randy (2005) insist that when conducting a research methodology should meet the
following two criteria:
Firstly, the methodology should be the most appropriate to achieve objectives of the
research.
Secondly, it should be made possible to replicate the methodology used in other
researches of the same nature
The differences between objectivist and subjectivist dimensions are presented by Cohen
et al (2007) as taken from Greenfield (1975) in the following manner:

Dimensions of
comparison Objectivist Subjectivist

Idealism – the world

Realism – the world exists, but is studied
exists and can be studied differently by different
Philosophical basis as it is people
 Exploring universal laws
of the society and the Exploring how the
behavior of people within world is interpreted by
Role of social science it different people

Basic units of social Society or organization

reality (s) Individuals

Studying the type and Studying subjective

nature of various meanings that
Comprehension relationships that allow individuals impose upon
methods the collectivity to exist their actions

A rational construction
that has been proposed Sets of meanings used
by researchers in order to by individuals in order to
explain the human interpret their world and
Theory behavior behavior

Looking for meaningful

Validation of theory relationships and
through experimentation establishing the
Research or quasi-experimentation consequences of actions

The use of quantitative

analysis and The analysis and
Methodology mathematical methods interpretation of reality

Is managed by a set of Is managed on the basis

general values, rules and of values possessed by
Society regulations people with power

The most comprehensive information regarding vital aspects of methodology is provided

by Jackson (2011) that can be summarised in the following table:
 Research
Goal met methods Advantages/disadvantages

Observational Allows description of behavior (s)

method
Does not support reliable predictions
Case study method
Does not support cause-and-effect
Description Survey method explanations

Allows description of behavior (s)

Co relational
method Supports reliable predictions from one
variable to another
Quasi-
experimental Does not support cause-and-effect
method explanations
Prediction

Allows description of behavior (s)

Supports reliable predictions from one
variable to another
Experimental
method Supports cause-and-effect explanations
Explanation

Data type:
Qualitative Data Analysis
Qualitative data refers to non-numeric information such as interview transcripts, notes,
video and audio recordings, images and text documents. Qualitative data analysis can be
divided into the following five categories:
1. Content analysis. This refers to the process of categorizing verbal or behavioural
data to classify, summarize and tabulate the data.

2. Narrative analysis. This method involves the reformulation of stories presented by

respondents taking into account context of each case and different experiences of each
 respondent. In other words, narrative analysis is the revision of primary qualitative
data by researcher.

3.Discourse analysis. A method of analysis of naturally occurring talk and all types
of written text
.

The following table contains examples of research titles, elements to be coded and
identification of relevant codes:

Research title Elements to be coded Codes

Born or bred: revising Born leaders

The Great Man theory of
Made leaders
leadership in the
21st century Leadership practice Leadership effectiveness

Wholly-owned
subsidiaries
A study into advantages Joint-ventures
and disadvantages of
Franchising
various entry strategies to
Chinese market Exporting
Market entry strategies Licensing

Philanthropy
Supporting charitable
courses
Impacts of CSR
programs and initiative Ethical behaviour
on brand image: a case
Brand awareness
study of Coca-Cola
Company UK. Activities, phenomenon Brand value

An investigation into the Viral messages

ways of customer
relationship management Customer retention
in mobile marketing
environment Tactics Popularity of social
networking sites

Quantitative Data Analysis

In quantitative data analysis you are expected to turn raw numbers into
meaningful data through the application of rational and critical thinking.
Quantitative data analysis may include the calculation of frequencies of variables
and differences between variables. A quantitative approach is usually associated
with finding evidence to either support or reject hypotheses you have formulated
at the earlier stages of your research process.
The same figure within data set can be interpreted in many different ways;
therefore it is important to apply fair and careful judgement.
For example, questionnaire findings of a research titled “A study into the impacts
of informal management-employee communication on the levels of employee
motivation: a case study of Agro Bravo Enterprise” may indicate that the majority
52% of respondents assess communication skills of their immediate supervisors
as inadequate.
This specific piece of primary data findings needs to be critically analyzed and objectively
interpreted through comparing it to other findings within the framework of the same
research. For example, organizational culture of Agro Bravo Enterprise, leadership style,
the levels of frequency of management-employee communications need to be taken into
account during the data analysis.
Moreover, literature review findings conducted at the earlier stages of the research
process need to be referred to in order to reflect the viewpoints of other authors
regarding the causes of employee dissatisfaction with management communication.
Also, secondary data needs to be integrated in data analysis in a logical and unbiased
manner.
Let’s take another example. You are writing a dissertation exploring the impacts of
foreign direct investment (FDI) on the levels of economic growth in Vietnam
using correlation quantitative data analysis method. You have specified FDI and GDP as
variables for your research and correlation tests produced correlation coefficient of 0.9.
In this case simply stating that there is a strong positive correlation between FDI and
GDP would not suffice; you have to provide explanation about the manners in which the
growth on the levels of FDI may contribute to the growth of GDP by referring to the
findings of the literature review and applying your own critical and rational reasoning
skills.
 A set of analytical software can be used to assist with analysis of quantitative data. The
following table illustrates the advantages and disadvantages of three popular
quantitative data analysis software: Microsoft Excel, Microsoft Access and SPSS.

Advantages Disadvantages

Big Excel files may run slowly

Cost effective or Free of Numbers of rows and columns
Charge are limited
Can be sent as e-mail Advanced analysis functions are
attachments & viewed by time consuming to be learned by
most smartphones beginners
All in one program Virus vulnerability through
Excel
macros
Spreadsheet Excel files can be secured by a
password

One of the cheapest amongst Difficult in dealing with large

premium programs database

Flexible information retrieval Low level of interactivity

Ease of use Remote use requires installation

Microsoft of the same version of Microsoft
Access Access

Broad coverage of formulas

and statistical routines
Expensive cost
Data files can be imported
through other programs Limited license duration
Annually updated to increase Confusion among the different
SPSS sophistication versions due to regular update

Advantages and disadvantages of popular quantitative analytical software

Quantitative data analysis with the application of statistical software
consists of the following stages[1]:
Preparing and checking the data. Input of data into computer.
 1.Selecting the most appropriate tables and diagrams to use according to your
research objective..

1.Selecting the most appropriate statistics to describe your data.

2.Selecting the most appropriate statistics to examine relationships and trends

in your data.

It is important to note that while the application of various statistical software

and programs are invaluable to avoid drawing charts by hand or undertake
calculations manually, it is easy to use them incorrectly. In other words,
quantitative data analysis is “a field where it is not at all difficult to carry out
an analysis which is simply wrong, or inappropriate for your data or purposes.
And the negative side of readily available specialist statistical software is that
it becomes that much easier to generate elegantly presented rubbish”[2].
Therefore, it is important for you to seek advice from your dissertation
supervisor regarding statistical analyses in general and the choice and
application of statistical software in particular.

Quantitative Data Analysis

In quantitative data analysis you are expected to turn raw numbers into
meaningful data through the application of rational and critical thinking.
Quantitative data analysis may include the calculation of frequencies of variables
and differences between variables. A quantitative approach is usually associated
with finding evidence to either support or reject hypotheses you have formulated
at the earlier stages of your research process.
The same figure within data set can be interpreted in many different ways;
therefore it is important to apply fair and careful judgement.
For example, questionnaire findings of a research titled “A study into the impacts
of informal management-employee communication on the levels of employee
motivation: a case study of Agro Bravo Enterprise” may indicate that the majority
52% of respondents assess communication skills of their immediate supervisors
as inadequate.
This specific piece of primary data findings needs to be critically analyzed and
objectively interpreted through comparing it to other findings within the
framework of the same research. For example, organizational culture of Agro
Bravo Enterprise, leadership style, the levels of frequency of management-
employee communications need to be taken into account during the data
analysis.
Moreover, literature review findings conducted at the earlier stages of the
research process need to be referred to in order to reflect the viewpoints of other
authors regarding the causes of employee dissatisfaction with management
communication. Also, secondary data needs to be integrated in data analysis in a
logical and unbiased manner.
Let’s take another example. You are writing a dissertation exploring the impacts
of foreign direct investment (FDI) on the levels of economic growth in Vietnam
using correlation quantitative data analysis method. You have specified FDI and GDP
as variables for your research and correlation tests produced correlation
coefficient of 0.9.
In this case simply stating that there is a strong positive correlation between FDI
and GDP would not suffice; you have to provide explanation about the manners
in which the growth on the levels of FDI may contribute to the growth of GDP by
referring to the findings of the literature review and applying your own critical
and rational reasoning skills.
A set of analytical software can be used to assist with analysis of quantitative
data. The following table illustrates the advantages and disadvantages of three
popular quantitative data analysis software: Microsoft Excel, Microsoft Access
and SPSS.

Advantages Disadvantages

Big Excel files may run slowly

Cost effective or Free of Numbers of rows and columns
Charge are limited
Can be sent as e-mail Advanced analysis functions are
attachments & viewed by time consuming to be learned by
most smartphones beginners
All in one program Virus vulnerability through
Excel
macros
Spreadsheet Excel files can be secured by a
password

Microsoft One of the cheapest amongst Difficult in dealing with large

 Access premium programs database
Flexible information retrieval Low level of interactivity
Ease of use Remote use requires installation
of the same version of Microsoft
Access

Broad coverage of formulas

and statistical routines
Expensive cost
Data files can be imported
through other programs Limited license duration
Annually updated to increase Confusion among the different
SPSS sophistication versions due to regular update

Advantages and disadvantages of popular quantitative analytical software

Quantitative data analysis with the application of statistical software consists of
the following stages[1]:

1. Preparing and checking the data. Input of data into computer.

Selecting the most appropriate tables and diagrams to use according to your research
objectives.

Selecting the most appropriate statistics to describe your data.

Selecting the most appropriate statistics to examine relationships and trends in your data.

It is important to note that while the application of various statistical software

and programs are invaluable to avoid drawing charts by hand or undertake
calculations manually, it is easy to use them incorrectly. In other words,
quantitative data analysis is “a field where it is not at all difficult to carry out an
analysis which is simply wrong, or inappropriate for your data or purposes. And
the negative side of readily available specialist statistical software is that it
becomes that much easier to generate elegantly presented rubbish”[2].
Therefore, it is important for you to seek advice from your dissertation supervisor
regarding statistical analyses in general and the choice and application of
statistical software in particular.

DATA ANALYSIS AND INTERPRETATION

Overall, Toyota has outperformed the industry over the past five years. Total assets increased
586.8 billion yen from the end of the previous fiscal year to 3,243.7 billion yen due mainly to an
increase in market value of investment securities. Liabilities amounted to 1,718.8 billion yen, an
increase of 259.7 billion yen from the end of the previous fiscal year due mainly to an increase in
deferred tax liabilities. Net assets amounted to 1,524.9 billion yen, an increase of 327.1 billion
yen from the end of the previous fiscal year. Cash flows from operating activities increased by
151.2 billion yen in fiscal 2013, due mainly to posting income before income taxes of 80.1 billion
yen. Net cash provided by operating activities increased by 49.5 billion yen compared with an
increase of 101.7 billion yen in fiscal 2012. Cash flows from investing activities resulted in a
decrease in cash of 274.2 billion yen in fiscal 2013, attributable primarily to an increase in
payments for purchases of property, plant and equipment amounting to 112.4 billion yen. Net
cash used in investing activities increased by 264.8 billion yen compared with a decrease of 9.4
billion yen in fiscal 2012. Cash flows from financing activities resulted in an increase in cash of
7.0 billion yen in fiscal 2013, due mainly to 51.7 billion yen of net increase in short-term loans
payable, despite the redemption of bonds payable of 54.1 billion yen. After adding translation
adjustments and cash and cash equivalents at beginning of period, cash and cash equivalents as
of March 31, 2013 stood at 179.3 billion yen, a decrease of 117.5 billion yen, or 40%, over fiscal
2012. 25 Detailed Financial Ratios are shown in APP RECOMMENDATIONS:

RECOMMENDATIONS
1) Toyota should continue to undertake concerted efforts to strengthen its management platform
and raise corporate value.

2) As immediate tasks, Toyota should promote business and cost structure reforms to realize a
solid management platform so that it can respond quickly to the changing market
circumstances. Specifically, Toyota should maintain a streamlined structure through the
reduction of fixed costs and enhance its business in established markets in developed countries

. 3) Toyota should accelerate its business expansion into rapidly growing emerging countries by
thoroughly and meticulously monitoring market conditions in respective regions and
introducing products suited to the characteristics and needs of each market. Toyota should also
strive to establish production and supply structures to realize optimum product pricing and
delivery, and to enhance the value chain to provide a wide range of customer services in each
country and region.
4) Toyota should consider making Lexus a priority in the Chinese market. This will enable it to
become competitive with other car manufacturers in the luxury segment. By increasing
production facilities in Asia, this will enable Toyota to have cheaper delivery channels and
become closer to the emerging market customer. Toyota should also cut out layers of middle
management so that engineers get more authority over what specific customer needs are
answered in the design and development of a new car.

5) Toyota should pursue the development of environmentally conscious, energy-saving

products while incorporating functions and services demanded by customers (value chain) and
delivering them to the global market. Acting on these measures, Toyota should aim for growth in
three business units, namely, “solutions” in the areas of materials handling equipment, logistics
and textile machinery; “key components” in the fields of car air-conditioning compressors and
car electronics; and “mobility” in the domains of vehicles and engines.

6) To support consolidated management on a global scale, Toyota should enhance the power of
the workplace and diversity in the use of human resources, and strive to nurture global human
resources.

7) In addition to placing top priority on safety, Toyota should thoroughly enforce compliance,
including observance of laws and regulations, and actively participate in social contribution
activities.

8) Toyota should aim to support industries and social infrastructures around the world by
continuously supplying products and services that anticipate customers’ needs in order to
contribute to engendering a compassionate society.

9) Overall, Toyota has outperformed the industry over the past five years and gained market
share. A shift toward smaller, more fuel-efficient vehicles, which Toyota can manufacture at a
relatively low price, will support growth in the United States.

REFERENCES:

1 Yahoo Finance, accessed November 9, 2013, http://finance.yahoo.com/q/pr?s=TM+Profile

2 IBIS World: Global Car & Automotive Manufacturing Report, May 2013
3 IBIS World: Global Car & Automotive Manufacturing Report, May 2013
4 IBIS World: Global Car & Automotive Manufacturing Report, May 2013
5 PRWeb, http://www.prweb.com/releases/2013/9/prweb11088066.htm

Motor Trends, accessed November 9, 2013

http://www.motortrend.com/features/auto_news/1202markets_share_for_the_top_five_auto
makers/
7 Toyota Motor Corporation, http://www.toyota-
global.com/company/vision_philosophy/toyota_production_system/
8 MarketLine: Toyota Motor Corporation Report, January 2013
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15 MarketLine: Toyota Motor Corporation Report, January 2013
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