History Of Toyota

Company Introduction

Origins:

Toyota started off as a division responsible for producing automobiles in Toyoda Automatic loom works. In the year 1930, the Japanese were anticipating war with the Chinese, which created a need to have vehicles with military applications. This prompted the Japanese government to support Toyota by giving them the license. The company’s founder was Kiichiro Toyoda who had travelled extensively to the US and the Europe to understand the automobile production there and also was considering the use of gasoline powered engines.

Toyota motor corp. was established as an independent company in the year 1937. The company manufactured its first automobiles the A1 passenger car and G1 truck in 1935. During World War 2, the

has grown itself into a global automotive manufacturer with presence in around 27 countries where vehicles are manufactured. It has around 338,800 employees worldwide and is the 12th largest company in revenues of around 22 trillion yen. Its production output as recorded officially till 2012 was estimated to be around 9 million vehicles. It is also the largest listed company in Japan in terms of market capitalization. Due to expansion and also catering to a range of customers most of whom were middle income, Toyota saw the need to cater to luxury segment and also the young generation. Thus, it created two new brands Lexus and Scion. Lexus was founded in the year 1989 and catered to the premium segment. Scion was founded in the year 2002 and catered to the Generation Y

Trade Barriers: There was imperfect competition and many countries in the world were closed economies. Thus, trade was only limited to few parts of the world.

The main objective of Old economy or Industrial economy was manufacture of goods that could be sold.

Company’s performance in the old economy

Toyota Motor Corp was established from Toyota Automatic loom works and hence the company had absolutely no experience in automotive production. Many people who were former employees of GM-Japan, Nippon and Hakuyosha were hired to provide the expertise.

Before the war, Japan had a very good industrial growth. Toyota concentrated its production largely to satisfy the Japanese Army need for vehicles for the war.

After the war, in 1950, the company was in the verge of bankruptcy with sales of only 300 trucks. The company was revived by loans and by sales of trucks to the US army for Korean War.

By the year 1969, Toyota had exported nearly 1 million units, Australia being the largest export market. Annual sales reach 1 million units.

Toyota reaches the production of 10 millionth unit in the year 1972 and by the end of the decade, cumulative exports reach 10 million