Competitive Connection

October 15, 2007

A look at the competition
Toyota struggles in Japan
Toyota, Japan's leading carmaker, warned that its domestic sales were likely to fall short of forecasts, highlighting a sharp downturn in demand.

Toyota's downbeat view of its Japanese sales prospects underscores the tough environment carmakers are facing in their home markets. This year, vehicle sales are expected to be lower in the U.S. and flat at best in Western Europe.

Japan's domestic car market is suffering from a declining population as well as changing lifestyles among its younger people, who are not as interested in car ownership as their elders have been.

Like its local rivals Honda and Nissan, Toyota sells more vehicles in the U.S. than it does at home, and is making up for slack demand in Japan by pushing into other overseas markets.-- Source: Financial Times, October 10, 2007
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Around the globe
Ford expands overseas
As it proceeds with plans to cut jobs and close factories in North America, Ford is expanding aggressively in Asia, announcing a $500 million investment to build a car plant in Thailand just two weeks after opening a $510 million manufacturing center in Nanjing, China.

Ford’s strategy appears to be to save money by curtailing operations in North America while making money by expanding in growth markets in Asia and elsewhere abroad.

Its operations outside the United States provide Ford with a lifeline of liquidity, including $551 million in pretax profit in South America in 2006 and $469 million in Europe.—Source: New York Times, October 10, 2007
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What others are saying . . .
Taking on competition in the mid-size market
General Motors marketing chief Mark LaNeve says future Chevrolet car advertising will look to “disrupt conventional thinking” about the superiority of Japanese competitors.  Chevrolet will take on leading Japanese automakers with an advertising campaign that highlights the Malibu's design, value and fuel economy.

“The ads are designed to attack the belief system that an American car company can't build a car that can compete with the Japanese,” LaNeve says.

Chevrolet has a long way to go to challenge its Japanese rivals. GM sold 163,853 Malibus last year in the United States. Toyota sold 448,445 Camrys, Honda sold 354,441 Accords, and Nissan sold 232,457 Altimas.

“It all comes around to the Malibu,” LaNeve says. “For us to really regain market position in the critical mid-sized market, we can't just have crossovers. We need to have cars be very successful.”—Source: Automotive News, October 8, 2007
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A look at the competition
Environmentalists question Toyota
Toyota, which has sold more than 1 million fuel-saving hybrid vehicles worldwide and accounts for 78% of hybrid sales in the USA, is under attack from environmental groups and at least one member of Congress for opposing tough fuel-economy legislation.

Toyota isn't used to this kind of attention. It's usually basking in favorable publicity for its vehicles' strong sales, their good reliability scores and the top fuel-economy rankings of its Prius hybrid.

Toyota's U.S. headquarters has been hit with more than 8,000 e-mails, mainly from Natural Resources Defense Council members. The Union of Concerned Scientists and other organizations also have begun urging members to deluge Toyota and Congress.—Source: USA Today, October 4, 2007
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To read previous editions of the Competitive Connection or to access other information about manufacturing and labor at GM, visit http://www.gmmanufacturing.info