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Dcm Toyota Summary

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DCM – Toyota Ltd. Of India

Climate for business: India vs US - India’s economy is larely based in agriculture (1989 : 80% GNP) - 800M people; large market (largest democracy in the world) - Domestic production to reduce imports is encouraged - Absence of reliable electric power thus firms encounter frequent electric supply problem - Poor quality of Indian road system, making products and goods for sale difficlt to transpor - By 1980, icenses for joint venture with foreign companies is easily obtained. - Rapidly growing number of institutional investors in 1989

Market for LCV in India - 1951 : 11% transported by road (others is either by rail or water) - 1986 : transport by road had grown to 50% - 2001 projection: 62% transported by road - Since rail roads were slower and air freight is limited due to terrorrism bombing, demand on CV rise. - 2 tonnes and 3.5 tonnes LCV were produced

Five Forces Model

Suppliers : Strong - limited number of suppliers that supply quality parts demanded by DCM - substitute parts for LCV were not yet considered - suppliers can demand higher cost due to unavailability of needed parts

Buyers : Moderate - since DCM produces quality products, mostly incur high price limiting the number of costumers buying the product

Substitute : Weak - alternatives are available such as ox cart, river barges, railway and airplane wherein it does not meet the user’s wants which is inclined on transporting fast and easy.

New Entrants : Weak - entry in the field requires large capital investment

Competitors : Strong - statistics shows the tough fight for companies in this field with regards to price comparison and superior quality feature.

Strength - produces quality product - latest production technology -

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