The Automotive Industry Highly Competitive Cutting Edge Technology Constant Change & Innovation Reputation is Everything
Industry Leaders Toyota GM Ford Honda Nissan
Toyota: The Innovators Developed a strong company culture “The Toyota Way” A Methodology copied by many. Possess Innovative Patents that provide advantages over competitors
“The Toyota Way” Respect Teamwork Challenge Kaizen: Concept of continuous improvement Genchi Genbutsu: Go and See, for managers
The Toyota Way &Consumers Years of satisfaction Consumer Loyalty based on: Trust Safety Quality Reliability Innovation Design
Toyota 2009 A tragic event: a family dies in their 2009 Lexus ES350. Accelerator issues are uncovered. Company deflects blame. Company concealments become evident. Eventual admission of fault. Customer & investors trust is shaken.
2009 Aftermath Financials all plummet in 2009. All aspects suffer Competitors take advantage of downfall Company struggles to recover Toyota works to regain trust
Ratio RankingsColleen Israel Toyota GM Ford Honda NissanProfitability Ratios:RANKINGS Best =1worst = 5Compared to one anotherReturn on InvestmentReturn on Assets (ROA) 5 2 1 4 3Return on Equity (ROE) 5 2 1 4 3EBITDA 4 5 1 3 2Earnings Before Interestand Taxes Depreciationand AmortationLiquidity RatiosQuick Ratio 4 3 5 2 1Current Ratio 4 3 5 2 1Debt ManagementTotal Debt to Equity 3 5 1 4 2Asset ManagementTotal Asset Turnover 5 1 3 4 2Inventory Turnover 4 3 5 1 2total score 34 24 22 24 16lower = better
Ranking: Best Investment Toyota 34 GM 24 Honda 24 Ford 22 Nissan 16
Toyota’s Future Aggressive Innovation Rebuild trust Better negotiation with consumer Return to putting customer 1st Revisit original mission of continuous improvement. Investors: moderate investment for moderate improvements.