International Marketing Business Recommendation, includes as SWOT analysis, business evaluation and expansion plans into Thailand (developing country) in this example focusing on Aisin Co. Ltd (a tier one Japanese automotive part supplier).

1. [u06a1] Marketing Plan and Recommendation by Scott Farwell
By Scott Farwell
MBA6118 – International Marketing
Capella University

2. [u06a1] Marketing Plan and Recommendation by Scott Farwell
[u06a1] Marketing Plan and Recommendation
Product and SWOT Analysis:
Aisin Co. Lt primary product is to provide automatic transmissions “for rear-wheel drive
vehicles, which will be supplied to Toyota Motor Corporation's plants in Thailand”
(MarkLines.com). These automatic transmission supplied to Toyota and other
automakers will be produced in Thailand and also ultimately exported outside Thailand
as well thanks to the positive free trade environment established and supported by the
government of Thailand.
SWOT Analysis:
Strengths: Aisin Co. Ltd. is expanding in Thailand following their largest customer’s
expansion and growth in Thailand. This is positive and a safe bet by following your
largest customer so this can be a stabilizing factor for doing business in that region. In
other words, everything else being equal, it generally makes good business sense to be
close to your largest customer where the majority of your sales and repeat business
come from.
Weaknesses:
The only weaknesses is how many carmakers make transmissions in house or by
themselves plus their primary competitor is tied with Nissan, which limits their ability to
sell to Nissan. This will be explained more in the next section.
Opportunities:
Since Aisin Aw Co. Ltd is tied to Toyota, they have Toyota as their primary customer.
The opportunity lies with increasing business with other car makers in Thailand to
maximize their market share in Thailand and to help maximize sales and profits.
Threats:
Jatco is their largest direct competitor and they are fighting for market share globally
and on a regional basis. Jatco is tied to Nissan and Aisin AW Co. Ltd is tied to Toyota
as these OEMs have a direct stake in each respective tier one. Many automakers
produce their own transmissions in-house so that could be indirect competition.
“Aisin AW, the world's largest AT specialist, is an AT unit of Toyota-affiliated Aisin Seiki.
In 2012, the major Japanese supplier had the largest share at 12% in the global

3. [u06a1] Marketing Plan and Recommendation by Scott Farwell
AT/CVT market, followed by JATCO at 11%. JATCO is rapidly catching up with Aisin
AW” (MarkLines.com).
Since Aisin AW Co. Ltd. is a Japanese company expanding into Thailand it is not
extremely different with regards to cultural differences. Since they are on the same
continent they should already have a basic understanding of the culture in Thailand.
Language is the biggest difference but they are selling primarily to Toyota
Aisin AW Co. Ltd will not need to change their product in Thailand. It is important
that they carefully review their SWOT analysis so they fully understand their challenges,
opportunities, threats and weaknesses. They will need to keep a close eye on their
largest competitor, namely Jatco, in their continuous fight for market share in Thailand
and beyond. They are already established in Thailand so they should already have a
good understanding about the language and culture and be assimilated into the society
of Thailand so this should not be a problem with their current expansion plans in this
region.
Description and analysis of the target market:
The environment in Thailand is positive for continuous growth in the automotive
industry thanks to a free trade mentality approach and governmental support.
“The automotive industry in Thailand is looking to further growth and
development. Such optimism stems largely from free-trade agreements
(FTAs) with countries such as Japan, China, South Korea, Australia, New
Zealand and India, and the prospect of rising exports to ASEAN member

4. [u06a1] Marketing Plan and Recommendation by Scott Farwell
nations. As the industry contributes significantly to the local economy, the
Thai government is also offering support in the form of tax incentives and
various other measures, making Thailand fertile ground for investors”
(business-in-asia.com).
These free trade agreements are important for the continued success and to support
the right environment for continued growth in Thailand. Furthermore, Thailand has a
positive business environment due to a skilled workforce and low cost labor. This helps
make Thailand attract investments and to stimulate continued economic growth which
includes the automotive sector.
“The Thai people are a plus as well, as the country boasts a skilled
workforce. Labor costs here are lower than in many other areas of Asia. The
land and facility costs are also competitive. Moreover, the government is
encouraging the development of so-called auto parts clusters, where
proximity between manufacturers and suppliers will result in further cost and
efficiency benefits” (business-in-asia.com).
Aisin Co. Ltd should follow through with the plans they announced to invest in
and expand their operations in Thailand. This is consistent with their plans announced
to expand their global footprint. Automotive vehicle production is trending upwards and
expected to continue to grow into 2017 and beyond so this specific economic trend is
important to support this decision to invest more in Thailand.
“According to LMC Automotive's forecast in August 2014, Thai light vehicle
production in 2014 will be 1.94 million units, which will be a 19.9% decline
y/y. The sharp drop was partly a result of the high base effect of the output
in the first half of 2013 (due to the delivery of vehicles under the first car
purchase scheme). The domestic market continued to register sharp
declines, while exports have so far been stable.

5. [u06a1] Marketing Plan and Recommendation by Scott Farwell
LMCA projects that production in Thailand is expected to grow over the
next three years and will reach 2.79 million units in 2017. Among the OEMs,
Ford is projected to increase production significantly over the period. The
automaker is likely to shift output of the Fiesta from Mexico to Thailand in
2016” (MarkLines.com).
See Appendix 1
“Production in Thailand actually decreased in 2014 when compared to
2013, but it is still expected to trend upwards overall through 2017”
(MarkLines.com). See Appendix 2 to see this production trend increase
This expected increase in total vehicle production in Thailand supports this
investment decision by Aisin Co. Ltd. This is a supply and demand issue so
naturally if the market is growing and expected to continue to grow and expand
then they should want to follow suit to support supplying to their customers in this
developing country. Furthermore, …
“Since Thailand is considered to be an important production and export hub in the
medium and long term, some OEMs continue to expand their production capacities
in the country. Nissan started operations at its new 150,000-unit plant in July 2014.
SAIC Motor-CP, which is a Chinese-Thai joint venture, opened a new 50,000-unit
plant in June (2014). VW reportedly plans to build a new plant to produce eco-
cars by 2019. Mitsubishi Motors and Isuzu enhanced their development units in
Thailand” (MarkLines.com).
See Appendix 3 for a visual that shows that Thailand is growing as an export hub so an
increasing number of vehicle produced in Thailand are being exported to other
countries. A similar export hub in North America is Mexico due to the lower cost labor in
that region for example. The GDP in Thailand in 2013 was $11.41 trillion in US Dollars

6. [u06a1] Marketing Plan and Recommendation by Scott Farwell
Assessment of consumer behavior issues relevant to the product or service.
Consumers purchase a car or truck and expect the automatic transmission to
work and perform. Aisin Co. Ltd’s customer is the automaker. They are a tier one so
naturally their client is Toyota for example. Consumers purchase a vehicle based on a
variety of factors that include features, styling, pricing, safety features, and more.
Aisin Co. Ltd. needs to keep their direct customers, the automakers, happy and satisfied
by providing the best quality automatic transmission at a competitive price. In the end
consumers will benefit and their direct clients will want to buy more of their automatic
transmissions in Thailand and in other countries around the world.
Product augmentations if needed, such as packaging and other considerations:
Packaging is not an applicable factor, with regards to Aisin Co. Ltd marketing
plan in Thailand, since they are not marketing automatic transmissions to the public
directly. This is a result of the nature of their product and relationship to their direct
customers, the automakers. They sell to the automaker who then installs their
automatic transmission into a specific vehicle model. The end user who then drives the
vehicle might not even be aware who produced and supplied the parts like an automatic
transmission or continuously variable transmission.
The branding and brand recognition by a given retail consumer in any market is
more closely tied with the automaker by brand, make and model and not on which

7. [u06a1] Marketing Plan and Recommendation by Scott Farwell
automotive part supplier made which specific parts in general. However, Aisin Co. Ltd.
does need to pay attention to requests by the automakers to adjust automatic
transmissions in certain regions based on different demand in certain countries and
markets. These can be adjusted based on the specific orders, or supply agreements,
they receive from an automaker. In other words, some developing countries like
Thailand would tend to demand smaller vehicles due to the price and consumer
preferences to buy more fuel efficient vehicles.
For these same reasons, strategic marketing components like distribution, pricing
and promotion strategies only relate directly to their relationship with the automakers
and not the general public directly. Pricing would be important when working to win the
business with a new supply agreement to a specific automaker on a specific future
model. This is part of the decision making process for an automaker to select a certain
tier one to supply them certain parts in a specific market on a certain model.
Aisin Co. Ltd. should definitely follow through with their plans they announced to
invest and expand in Thailand. The business environment is one that is positive due to
the free trade approach by the government of Thailand combined with the low cost labor
available in Thailand with a strong human capital pool to use makes is attractive region
that attracts investment and to help foster continuous growth. It makes sense to be
close to Toyota, their largest customer as well as other carmakers that are expanding in
Thailand because it is a growing export hub. This trend is predicted to continue to
increase in the years to come as a result of the aforementioned positive business

8. [u06a1] Marketing Plan and Recommendation by Scott Farwell
environment so it makes sense for Aisin Co. Ltd. to invest and expand in Thailand as
planned.

9. [u06a1] Marketing Plan and Recommendation by Scott Farwell
Appendix Section:
Appendix 1:

10. [u06a1] Marketing Plan and Recommendation by Scott Farwell
Appendix 2:
-source: MarkLines.com (using LMC production forecast data).

11. [u06a1] Marketing Plan and Recommendation by Scott Farwell
Appendix 3:

12. [u06a1] Marketing Plan and Recommendation by Scott Farwell
References:
www.marklines.com MarkLines Co. Ltd
Thailand: production expected to fall by 11% to 2.2 million units in 2014
Domestic demand shrinks due to end of incentives and political turmoil
Oct. 6, 2014 No.1330
http://data.worldbank.org/region/EAP
http://www.business-in-asia.com/automotive/thailand_automotive.html