[ad_1]
Is TOYOTA afraid of the consumer shift to electric vehicles (EVs), now led by Tesla that recently boasts of its car horn that sounds like a drunkard’s fart, a snake’s hiss, or a goat bleating in its tracks? Latest models? In an annual report to members of the Japan Automobile Manufacturers Association, Toyota Motor president Akio Toyoda expressed apprehension against the “excessive hype” about electric vehicles. He argues that electric vehicles also emit carbon and there are prohibitive transition costs.
Toyoda, who is also president of Toyota Motor, said that Japan “would be without power in the summer if all the cars were powered by electricity. The infrastructure needed to support a fleet consisting entirely of electric vehicles would cost Japan between ¥ 14 trillion and ¥ 37 trillion, the equivalent of $ 135 billion to $ 358 billion, ”according to a report by The Wall Street Journal. .
He said that if Japan rushes to ban gasoline-powered cars, “the current business model of the auto industry will collapse,” leading to the loss of millions of jobs.
Toyoda’s unease is fueled by the fact that Tesla’s shares “have more than tripled since the beginning of the year, giving it a market capitalization greater than that of many US industry giants.” Despite the 2019 coronavirus disease pandemic, the year ended with Tesla overtaking Toyota as “the world’s most valuable automaker.”
It started in July when Tesla shares hit a record high of. $ 1,134, leaving them with a market value of $ 209.47 billion, which is about $ 4 billion more than the current value of Toyota’s stock market, according to Bloomberg. Tesla’s profit came despite the fact that Toyota has sold more than 30 times as many cars in 2019 and its revenue was more than ten times higher.
Defeat of the first engine
Since the 1900s, electric vehicles have received increasing attention sparked by market forces and green initiatives from private groups that are being galvanized by some government policies. The United Kingdom, for example, is banning the use of fossil fuels from 2030 to 2040. In the United States, President-elect Joe Biden, during the presidential campaign, promised to transition the economy away from the oil industry.
Japan, on the other hand, is considering making all new car sales green by mid-2030. The government even plans to subsidize EVs with up to 800,000 yen per unit on the condition that they use renewable energy. including solar energy.
Analysts believe there is a bright future for electric vehicle sales due to technological advancement in battery development, the growing number of electric vehicle models, and increased investment in electric vehicle charging infrastructure. There are encouraging signs that investors and consumers are beginning to appreciate the benefits of electric vehicles over gasoline-powered models.
The auto industry is another good example when Ford Motor lost its first-mover advantage to Toyota, which has grown steadily over the years with its versatile new models, advanced technology, and competitive pricing, while academics and consultants who advocate for sales and marketing are driven by the power of Toyota’s production system.
It also reminds us of how Apple’s iPod defeated Sony’s Walkman, which relied heavily on analog technology, where it had a significant investment and competitive advantage. Sony used to be the leader in personal portable music technology with the Walkman until the iPod overtook it in 2010.
It’s the same false sense of confidence that lulled Kodak to complacency and a series of eventual corporate mistakes. Kodak invented digital photography, but did not take advantage of it when it relied heavily on its traditional film-based business model.
In reality, the first-mover advantage has its own expiration date. Pioneers can leverage their unique and fundamental competitiveness, but not for life. Eventually, some enterprising people would examine the original product and reverse engineer it to find out how they could improve its quality, lower production costs, achieve fast delivery to customers, and ensure near-lifetime service.
Quality, cost and delivery
Reflecting on the lessons of many companies here and abroad, large and small, innovative and not-so-innovative, their secret to profitability and long-term sustainability is often the result of the old Quality, Cost and Delivery framework ( QCD). They are often cited in uppercase, lowercase to emphasize their special place in the minds of manufacturers and service providers, regardless of the nature of their business or the type of production system they follow.
All three must go hand in hand. In Latin, it is called “ceteris paribus”, which generally means “on equal terms.” You cannot go alone without negatively affecting others.
All of these three elements, of the highest quality, sold at a competitive price and delivered on time to customers, must manifest in every product or service to maintain its popularity with your customers.
In recent decades, QCD has been added with the acronym SHE that stands for Safety, Health and Environment. Consumers have become sophisticated and do not want to endorse products that are not safe for users, made in dangerous or unhealthy work situations, or made without regard for Mother Nature. Nothing is more compelling than the customer’s belief.
How can you argue with that? If a product does not satisfy QCD and SHE, how can a manufacturer or service provider win the trust of its customer?
There is no question that Toyota is a trustworthy brand. But for how long? You may have some good points about the incredible cost of the transition to electric vehicles. Do you have to wait until Apple unveils its first car model for 2024? It’s not a far-fetched idea given Apple’s gossip factory that talks about revolutionary battery technology that could outshine Toyota, Tesla, or any other company.
Maybe it’s time for Toyota to rethink its ancestral strategy by introducing its own revolutionary rocket and its smartphone too.
Rey Elbo is a business consultant specializing in human resources and total quality management as a merged specialty. Send your comments to [email protected] or via https://reyelbo.consulting.
[ad_2]
