The automobile industry can be considered one of the most competitive industries that exist today. The production has to be flawless, the employees hardworking and the managers fully aware of their product. This case study is to discuss the economics phenomenon with Toyota in the automobile industry. Trying to analyze the relationships among the price, demand and supply and other factors in the automobile industry, such as substitute and complement products, market competitors and input prices or costs, etc.
1. Market structures
A classification system for the key characteristics of a market, including the number of firms, the similarity of the products they sell, and the ease of entry in to and exit from the market.
It refers to the characteristics of a market that define its structure include the number of firms in that market, the degree to which the products they sell are similar and the ease of entry into, and exit from, the market. Market structure includes, Perfect competition, Monopolistic competition, Oligopoly, Monopoly, etc.
Toyota market structures
Toyota Motor Corporation is a multinational company headquartered in Japan and it is one of the best car selling companies in the world. The company was founded in the year 1937 by a successful businessman - Mr. Kiichiro Toyoda. Toyota Group is the largest group of industries in the world. Toyota Industries develops and manufactures automobile and automobile-related products, such as vehicles, engines, car air-conditioning compressors, car electronics components and devices, and stamping dies. In the vehicle and engine businesses Toyota has achieved a top-class level of quality and productivity within the Toyota Group and is contributing to Toyota Motor Corporation's car production.
The picture above shows the most popular model in the current market from the Toyota Company. The white car show on the right corners that Corolla. With over 30 million sold, the Corolla is one of the most popular and best selling cars in the world. And also Toyota Camry the one in the middle, that is a mid size car. In the United States, the Camry has been regularly the bestselling car for the last 10 years, but has been outsold in some years. The Camry also sells very well in Australia, Canada, and a number of Asian markets—in particular Cambodia where the vast majority of cars are Camry. Toyota Yaris that is only one small car in the Toyota Company. There many girls love it includes me because it cute, small and economic. There are many different kinds of vehicle from the Toyota Company which can meet different customers need. There are four main different categories in the market which Passenger, 4WD, Commercial and Hybrid cars with the price of the car around ten thousand to hundred thousand.
Toyota sold 450,000 Camrys in 2006, up nearly 4 percent from 2005, according to Auto data, and well ahead of the No. 2 Accord with 354,000 units, down about 4 percent. Toyota Camry was established in 1980. It is the most successful car. The Camry has been one of the best selling vehicles in Australia and overseas over the past five years. The price of Toyota Camry ranges from 28,490 to 39,990$.
2. Toyota Camry Price sensitivity factors analysis
2.1Unique value effect
Their main value emphasized throughout this ad is the fact that it's a hybrid car, with all advantages thereof: cleaner exhaust, contributing to personal (though not stated clearly) and national economy. Although Toyota is not the only hybrid car manufactured (there are others by Honda and Ford), this ad doesn't mention it and presents it as a unique value inherent to Toyota Camry. The fact that a hybrid car is not a widespread phenomenon boosts the influence of this factor. We rank its influence as high (decreasing PS). 2.2Substitute awareness effect
It's difficult to compare car prices and benefits just when reading this add, though most of the...