Nissan and Toyota Hybrid Engines Essay

Nissan and Toyota Hybrid Engines Essay.

Introduction: Toyota and Nissan are immense automotive manufactories. They were both founded in Japan by Japanese founders. Toyota was founded in1937 by Kiichiro Toyoda (Wikipedia, 2007). Nissan was founded by Yoshisuke Aikawa three years before Toyota, in 1934(Wikipedia, 2007). Both of them considered nowadays two of the largest car manufactures around the world. Although they have their headquarters in Japan, they still can perform and control their businesses around all over the world. They use the latest technologies in management, marketing, manufacturing, and competing with other companies.

The successful factor in this kind of businesses is applying a flawless technology. The role of technology is important to lead the company sustain in higher position than other competitors in the same field. Additionally, we know that car production is a vast market where any small mistake could make the company lose reputation, customers then bankruptcy in some cases. Therefore, the impact of technology should be reflected on the company’s processes, functions and operations.

Accordingly, Toyota and Nissan have, in my point of view, a strong and solid strategies which are capable to assist them being on the top of automakers.

Of course they have different techniques but apparently the goals are sort of similar. If we compare their mission vision statements, we find that both of them concern about customers’ satisfaction and some other elements like environment and the stakeholders. This explains that they are going along each other with same future goals but with diverse strategies or at least they follow each other in order to get the biggest market share in the automobile markets around the world. Enabling of E-business:

Prior the revolution of the World Wide Web, the interaction with all agents and branches for a multinational business, such as Toyota and Nissan, was hard. They were using a regular mail services or fax for paper transactions and phone calls for other communications purposes. Especially for auto making companies like Toyota and Nissan in the case of having their headquarters in Japan with long distance between them and their branches in US for example. They could have intermediation to facilitate the financial and other management aspects in order to understand other countries’ regulations and commercial policies.

Afterward, the internet has made communications easier and faster. That forced most (if not all) companies to change their strategies and make it more automotive to increase their chances of getting the benefits of internet in order to expand their businesses. On the other hand, the chance of getting information and financial data about competitors has become grater which helped Nissan and Toyota understand how they perform and control the market. This made the competition between Toyota and Nissan becomes sharp. It is not only a matter of communication technology now.

They started to use the latest technology in the functions of manufacturing in their production lines. Impact of IT: Instead of having every piece assembled by hand, they automated many processes to be done automatically by robots. That issue made Toyota and Nissan to abandon many of their manpower. This was one of the bad effects of IT in that days where many people thought of that as non-ethical issue of IT. But the companies have done this in the sack of competition which was measured by enabling of IT. It became a necessity to get the lead of the market.

Vision and Mission: Toyota’s vision is clear enough to explain what the company is looking for in future. “Toyota aims to achieve long-term, stable growth in harmony with the environment, the global economy, the local communities it serves, and its stakeholders” (Toyota. co. ja, 2003). If we look at it and try to evaluate it with the elements of a good vision, we find that it is exactly effective statement. It is imaginable, describable, flexible and measurable. Nissan’s vision is “Nissan: Enriching people’s lives” (Nissan-global. com, 2007).

At a first look, it is too general and dose not follow the measurements of the effective vision. It is too flexible to include every enrichment concept under it. In my opinion, they have misunderstood the concept of vision and mission, as we going to see later, but still cannot phrase a clear vision. When we look at the mission statement of Toyota “Toyota seeks to create a more prosperous society through automotive manufacturing”, we see that it describe the purpose of the company in very simple way and shows what they are doing in order to make people’s lives fancy through automobile production.

On the opposite, Nissan’s mission says “Nissan provides unique and innovative automotive products and services that deliver superior measurable values to all stakeholders in alliance with Renault” and they described stakeholders by customers, employees and dealers. It is too long and dose not include customers in the statements. You need to read the explanation to understand that they meant customers when they said stakeholders. I think they misunderstood the meaning of vision and mission and the need to re-look at it then re-write it. Toyota SWOT Analysis: 1.

Strengths: Toyota has many strength points. It could be summarized as competitive advantages for Toyota. First, they have factories in US, China and Australia in order to decease the labor costs. Therefore, they have competitive prices for their vehicles. Additionally, they have other divisions like Lexus which is targeting other class of customers. They offer Lexus and other models with the option of having hybrid engine. And as we know, Toyota is a well known name and has a good reputation all around the world. 2. Weaknesses: The biggest weakness of Toyota is the decreasing of quality.

Having manufactories in other countries in order to decrease the labor cost could influence the quality of their products. Moreover, the design of their vehicles becomes the same in most categories of their cars. It almost has the same theme which could be annoying for customers. 3. Opportunities: Adopting the new technologies such as hybrid motors was the most important opportunity that Toyota has taken in consideration. They could work to develop and improve this kind of engines and offer it in all models they have. It is the only concerned issue nowadays for people.

It is “Greener” than the old technology motors which do not keep the environment clean as hybrid. Moreover, it saves gas consumption which trend to be high these days. 4. Threats: Nissan, Honda and some Korean carmakers are the most competitors of Toyota. And there are some others could compete with Toyota in other divisions like Lexus. It is a strong opponent of European cars like BMW and Mercedes. But Toyota is able to overcome that threat by competitive prices of its cars. Nissan SWOT Analysis: 1. Strengths: Nissan has received many awards for its products.

It has gotten the award for best V6 engine for 2007 for the 11th year respectively. Nissan has manufactories in US and in UK for some models. This gives Nissan’s cars American and European cars’ nature which is smoothness and reliability. Beside that, they have a division of Infinity which competes with Lexus. 2. Weaknesses: Simplicity of design its cars could be a major weakness for Nissan compared to its competitors. Another weakness could be the lack of advertising for its cars. Besides, they did not offer hybrid engines except for one model which is Altima. That narrows the customers, who are seeking for this type of engines, choices. 3.

Opportunities: They could increase their market share in the hybrid engines market by offering other models with this feature. They should offer it in Infinity cars to compete with the Lexus. 4. Threats: Mainly, Nissan is trying to overcome Toyota by offer cars in every class that Toyota has made. Toyota and Honda actually has taken the lead of attracting younger customers by offer affordable cars with high quality. Nissan should seek for a way which can help them increase their opportunity of attracting all customers segments. Hybrid Engines: It is a new technology that proved its efficiency of operating cars with gasoline and electricity.

Basically, the cars which have this kind of engines can be operated by electrical power and gas in the same time to save gas consumption and environmental friendly in the same time. So, the hybrid engine is the second technology if we considered gas fuel engines as a first technology in mass-production automobiles. In the S-curve chart, it shows that there is a discontinuity between the two technologies. That explains that when they started producing the hybrid engines, the horse power was less than the power of the gas engines with the same specifications.

When Toyota lunched its first hybrid engine (Toyota Prius) in 1997, it was trying to diversify its products, beside the previous reasons, in Japan and offer multi options for its customers there. Then, it offered it worldwide in 2001 (Wikipedia, 2007). Although the hybrid engines were produced before, Toyota was the first company started to mass-produce this type of engines. So, it was new market and new product for Toyota. Based on Ansoff matrix, Toyota would be as follow: Table 1: Toyota in Product Market matrix Product PresentNew MarketPresentMarket PenetrationProduct Development NewMarket Development

In contrast, Nissan just lunched its first hybrid engine on Altima 2007. It is away behind Toyota and considered very late to use this technology on its cars. Since the market is present and Nissan only have made a new product, therefore, Nissan will be in product development stage in Ansoff matrix as follow: Table 2: Nissan in Product Market matrix Product PresentNew MarketPresentMarket Penetration NewMarket DevelopmentDiversification Hybrid Market Share: In 2006, Toyota has gained the biggest share of hybrid cars market by 71. 8%. Honda, which gained the second biggest share by 22.

5% of the market, is considered a shared leader with Toyota. 5. 7% is the remained which distributed among other automakers. Therefore, Toyota is a leading company in this growing market (hybridcarreview. com, 2006). Hybrid cars market is growing very rabidly. Toyota has kept providing the market with its models with hybrid engines while Nissan just lunched only one car, which is Altima, in 2008. There are many reports demonstrate that the hybrid market has grown from 2005 and kept growing. Based on a graph provided by HybridCars. com, the market will hit the 1 million cars sales limit in 2010.

Toyota in growth-share matrix: Since the hybrid cars market is growing and Toyota has the biggest market share, we can see that Toyota is partially dominating the market. It will be considered as “Stars” in the matrix, which has made by Boston Consulting Group. Market Growth RateRelative Market Share High Low High Question Marks LowCash CowsDogs Nissan in growth-share matrix: It is obvious that Nissan needs time to track Toyota and Honda in using the hybrid technology in their cars. Thus, Nissan position in this market is critical and needs to be reviewed. Considering the BCG matrix to analyze.

Nissan’s position, the will be in “Question marks” position. Market Growth RateRelative Market Share High Low High Stars LowCash CowsDogs Nissan has to come up with new technology in order to assist their position in the market. The new technology should be unique and has an effective value to get the competitive advantage in this competition. Furthermore, the business should be aligned with the new technologies that come out every while. Then, they should think comprehensibly of how they are going to sustain in this position by strengthen their side with durable technology.

Building vs. Buying: From the view of outsourcing or franchise, Toyota started to build its cars’ engines in its factories in Japan. After that, it started to build it now in Kentucky in US (Detroitnews. com, 2005) but still the factory owned by Toyota. Nissan used the technique of outsourcing when it put hybrid engine in its car. The engine actually is build and developed by Toyota. It has developed a Hybrid Synergy Drive HSD which is a system combined of hybrid car set was used in Toyota cars (Wikipedia, 2007).

Nissan thinks of building its own engine by 2010 (HybridCarReview. com, 2007). The reason for that is Nissan dose not want to take the risk of entering the hybrid market with new engine, which could has less efficiency than competitors’ engines. Conclusion: In the market of hybrid engines, Toyota has sustainable competitive advantages. That depends on its awareness of adopting new technologies and putting these technologies along with the business. Nissan needs to work that out in order to make a significant decision that can help them improve their products.

Nissan and Toyota Hybrid Engines Essay

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