Toyota in China: Selling at 'China Price'


Code : COM0082

Year :

Industry : Automobiles

Region : China

Teaching Note:Not Available

Structured Assignment :Not Available

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Toyota's Traditional Approaches To cost management In 1937, Kiichiro Toyoda started Toyota Motor Company to manufacture trucks for the Japanese Imperial army. After the Second World War, Toyota was left without cash and was on the verge of bankruptcy. However, the requirement of trucks by the US military helped Toyota to stay afloat. During that period, Toyota followed a series of cost-cutting programs. Toyota asked its 1600 employees to retire voluntarily as firing would have been against its policies. In addition, Toyota followed a 10% cut in wages for all its employees...

Cutting Costs To The Core: The Chinese Connection In 2000, Toyota launched its newcost-cutting programme CCC21 that was aimed at reducing the costs of 170 auto components (making up 90% of Toyota's purchasing costs) by 30%. With CCC21, Toyota aimed to save more than ¥100 billion a year. The cost reduction philosophy of CCC21 focused on reducing the cost of manufacturing parts through continuous improvement in product development. Noriyuki Matsushima, an analyst at Nikko Salomon Smith Barney, said, "Toyota wants nothing less than to be the world's lowest-cost producer of the highest-quality automobiles"...

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