It will outline the main features and components of this business including aim of the business, origins, location of headquarters, parent companies and subsidiaries. It will also explain the main operational activities of its main output, the Toyota Car through the ITO technique (input, transformation, output) as well as describing 3 human resource issues that Toyota Australia has to face. These include closing of manufacturing in Melbourne, diversity of employees andThe report will also discuss three management issues that are affecting the business in the areas, financial, legal and marketing. These issues include profit increase, extended warranty and defective filters. It will also discuss two ethical issues facing the business such as increased child labour and sustainability. Finally, the report will investigate the fact that they are the only company to manufacture hybrid cars in Australia which allows Toyota Australia to maintain and increase their competitive advantage.
Features of Toyota Australia
Toyota Australia is one on the leading manufacturing automobile companies and a multi-million-dollar transnational company. They are leaders in their field with advanced technologies including being the only vehicle manufacturer to build a hybrid car in Australia. Which makes them an ideal brand and puts them ahead of their competitors. This aims to deliver fuel efficiency and reduce emissions. Toyota Motor Corporations, sells its vehicles in approximately 190 countries and regions around the world. Their market for their automobiles are Japan, Europe, Asia and America but as a subsidiary of Toyota Industries.Originally Founded in 1958, this business did not start operation until April of 1963. Kiichiro Toyoda, the founder of the Toyota Motor Corporation. Their headquarters are located in Port Melbourne, Victoria, Australia. There are also many retail locations throughout Australia including offices in Victoria, Northern Territory, South Australia, Western Australia, Queensland and New South Wales. Toyota Australia’s after-tax profit was $137 million for the year ending 31 March 2019 and had 717 employees working for them.Toyota industries, a parent company of Toyota Australia is active in five main business areas; automotive, materials handling, electronics, logistics, and textile machinery. Toyota Australia however specialised and can be classified into the automotoblie industry.
The subsidiaries that Toyota Australia own include S.C.T Ptd Ltd and Lexus Australia Ltd. Toyota Australia is a subsidiary of Toyota Motor Corporation, which is based in Japan. It markets Toyota products and manages motorsport, advertising and business operations for Toyota in Australia. Matthew Callachor is the current President and CEO of Toyota Australia.
Operations of Toyota Australia
Toyota Australia provides a tangible good (Toyota vehicles) as well as a service (test drives, insurance, customer service) to customers all around Australia, offering a wide range of cars to chose from. The operations of this business allows it to be successful and function with ease. The main object that Toyota produces is cars and it is essential that they are able to perfect the manufacturing of vehicles in order to maintain their competitive advantage and keep business. For Toyota Australia to be an effective and efficient working business, the structure, including manufacturing, financial, marketing and human resources teams need to be well maintained.ITO of a Toyota car
Human Resources issue
The three major issues that Toyota faces presently include the closing of manufacturing in Melbourne, diversity of employees and workplace harassment. These affect Toyota in many ways and can help the company to learn from their mistakes or grow from their success to improve further.
1: Altona plant in Melbourne
Thousands of workers at the Altona plant located in Melbourne haved faced unemployment as Toyota Australia shuts down manufacturing. Out of these workers, 350 were laid-off with the image of being a ‘low productivity worker.’ This harms many aspects of ones life in their future jobs, significant financial risk and negatively affect family life. According to reports, after a process of workplace assessment, 350 were selected specifically on the basis of low productivity. One woman who left a permanent job in the public sector stated, “we were monitored on an hourly basis against performance benchmarks and, if we did not reach them, you would receive an email so there was a lot of pressure. In nine years, the individual benchmarks were doubled. Most people really struggled on a daily basis to make it.” Losing a permanent job at/above the age of 40 can be extremely high risk and these laid off employees may find themselves unemployed long term (especially with the stigma of low-productivity) and pushed into other jobs with lower pay and lower levels of security. Toyota dealt with this issue of shutting down manufacturing in a horrible way leaving many in significant trauma and risk.
2: Diversity of employees
It is essential for Toyota Australia to have a diverse range of employees as it plays an important role regard the needs of customers.Bringing diversity of employees to a business shapes it and helps break down barriers of communication which is important in a global business. Toyota provides employees with many opportunities to exercise their capabilities so that they are able to perform to the best of their ability. ersity of employees at Toyota Australia are currently As shown in  the diversity of leaders in Toyota is ever growing. This can be much further improved over time as Toyota develops its company and increases its cultural and ethical diversity. Toyota aims to focus on the customer segment where they are able to craft a general audiece ads as well as market specific ads with a common thread of connection and inclusivity that Toyota represents.  https://toyotadiversityreport.com/wp-content/uploads/2018/06/DI-Annual-Report_online-final-6.8.18.pdf
3: Workplace harassment
A Toyota Australia salesman who was repeatedly referred to using horrifying language and racist commentary by his superiors was left so scared that he could ‘barely talk’. The Sri Lankan born father of two is suing his former employer, South Melbourne Toyota, and two former managers in the Federal Court for multiple contraventions of the Racial Discrimination Act. The employee states that he was subject to the insults whilst working at a car dealer and alleges that these rasict comments were also targeted in some cases customers. He says that they often referred to curry and as ‘boat people’ when making the remarks. he was denied access to resources required to carry out his role, including where staff could obtain information about cars. Although the two managers named in the lawsuit are no longer working at South Melbourne Toyota, this issue of workplace harassment is still relevant today and gives the leaders and managers of Toyota Australia a bad reputation.It also shines a light to other people at Toyota of what not to do and helps Toyota further succeed in employing the right people.
There are a number of different issues which must be addressed by Toyota to ensure that the business operates efficiently and effectively. These issues include financial, marketing and legal aspects which Toyota must address.
Financial – Profit Increase
A financial issue that Toyota has faced is the increase in profit for the year ending March 2018. Toyota Australia was posted an after-tax profit of $206 million. This was a major rise from the year before that where the after-tax profit was only $137 million.The CEO of Toyota Australia stated that, “This successful result is a testament to the dedication and commitment of the entire team here at Toyota Australia, both past and present.” Considering that this year the market declined in the second half of the financial year, Mr Callachor states that it is a remarkable result. Despite the total sales volume decrease, due to the loss of export sales regarding the recent closing of manufacturing, the profit value for Toyota is increasing. This result puts Toyota at an optimum position to invest in projects to transform from a car company to a full mobility company.
Marketing – Extended Warranty
Due to public pressure and to maintain their competitive advantage, from January 1st 2019 Toyota boosted warranty coverage from three years to five years on every new model sold. This warranty will extend to seven years for particular parts such as the engine and drivetrain. This warranty also provides a loan car and free towing if the vehicle requiring warranty is undrivable. Toyota Australia’s sales and marketing boss Sean Hanley claims that they are responding to the needs of consumers regarding this change and that it is within the best interests for Toyota to give customers the ‘total ownership experience.’ This drastic change will affect Toyota both positively and negatively. Toyota Australia will be able to keep up with other competitors in the same industry and gain new customers. However, this will result in a loss of money through two extra years of warranty provided as well as towing and car loan expenses. This will be an aspect that Toyota Australia has already looked into and has compared against the benefit of changing their warranty plan.https://www.toyota.com.au/news/toyota-introduces-toyota-warranty-advantage
Legal – Defective filters
250,000 Toyota drivers have filed in Federal Court, claiming there is a faulty filter in a popular car for Australians, the Toyota Hilux. This possibly defective filter resulted in increased fuel consumption, decreased power and led fuel smoke to spew from the car’s exhaust. Drivers have reported that the fault has cost them over $70 a week for higher petrol costs. The vehicles experiencing these issues require time consuming and costly repairs, including repeated vehicle servicing and repeated replacement of the DPF. It has been claimed that Toyota in fact knew about this defect since 2016 and has been misleading the public. Toyota is offering to clean, replace, or retrofit a switch for Hilux, Fortuna and Prado vehicles sold between June 2015 and June 2018 free of charge, although they are not actively seeking or recalling these vehicles with faulty filters. This causes Toyota to have a bad reputation and receive negative publicity which could cause them to lose business from some customers and potentially lose some profit. Customers may not want to risk the possibility of having bad filters in any future car purchases.
1: Increased child labour
The reality of manufacturing batteries needed to produce electrical vehicles are severely under-publicised and not as innocent as one may think. The materials needed to produce these batteries are scarce and include precious metals such as nickel and cobalt. These also take a long time to harvest as well as leading to an increase in child labour in areas in Africa. With poverty also being a serious problem in this country, it is extremely difficult for any company to ensure that they purchase materials from the Congo that is child-labour free. With lithium-ion batteries in high demand, cobalt from the Congo region is also in high demand.
Toyota Australia seeks to contribute to the sustainable development of the plant across the globe and incorporate this into the business. In 2015, Toyota launched the ‘Toyota Environmental Challenge 2050’ to try to address main global environmental issues including;- Climate change- Water scarcity- Resource depletion- Declining biodiversityToyota Australia’s approach to this challenge is to focus on two main themes of a towards zero emissions and a recycling based society. To combat and reduce the amount of CO2 emissions, Toyota Australia has installed 600kw solar system in the Sydney Toyota Parts Centre and 50kw array at the Brisbane office. For the recently closed sites in Altona and Woolooware Bay, the remediation will allow for long-term usage as training facilities and housing a product knowledge. Toyota Australia also uses ‘Dealer Environmental Standards’ to keep dealers as environmental leaders and engage in improving the sustainability of their business. For this to occur, Toyota introduced the ‘Dealer Facility and Environment Excellence’ award in 2018. This award recognises dealers who strive to have a high standard of facility and make continuous improvements to the ecological performance and development of their dealership environment. Criteria include;- Conducting and acting on energy audits
- Installing green features such as solar
- Panels or LED lighting
– Participating in National Tree Day- Actively promoting hybrid vehicleshttps://toyotalifestyle.com.au/2018/10/12/toyota-australia-solar-energy-on-toyota-parts-centre-tpc-in-western-sydney/ https://planetark.org/campaigns/treeday.cfm
An important aspect that Toyota Australia provides for customers that differs from any other motor vehicle producing company in Australia is the fact that they are the only vehicle manufacturer to build a hybrid car in Australia. This puts them ahead of their competitors as anyone who intends to buy a hybrid car in Australia will have no other option but to buy it from Toyota. Since the first Prius sold in 2001, Toyota has now sold over 100,000 hybrid electric cars in Australia and is predicted to sell more than 20,000 in 2019. Toyota also offers the widest range of electrical vehicles of any car manufacturer in Australia. Hybrid cars alone have contributed to Toyota’s profit greatly and have been 5.3% accounted for 5.3% of sales in 2018 and are predicted to be 10% in 2019. With the hybrid vehicles available in Australia, new technology and wide range that Toyota possess, they will be able to use this in the future to further increase their competitive advantage.
The role of Toyota is to provide a car of good quality as well as a service to customers. The importance of what Toyota can offer is that people in society are able to have another option to buy vehicles from and can weigh up the advantages and disadvantages of investing in a Toyota Australia vehicle. It is also important for the parent companies of Toyota Australia as it allows them to connect with Australian citizens so they are able to properly adapt their vehicles to suit the needs of Australians using the headquarters in the local area.The importance of Toyota as a transnational corporation is that it is spread across the globe. The fact that is a global company allows it to be successful. It operates in …. Industry and with people in many nations, there may be a need to deal with human resource issues. Toyota also needs to ensure that they manage their financial, marketing and legal issue in each country and use an ethical approach in production to maintain a sustainable competitive advantage.
- Cowan J., Toyota to pay $1.3 billion for deadly defect cover-up, https://www.abc.net.au/news/2014-03-20/toyota-pays-1-3-billion-for-defect-cover-up-statements/5332894, last accessed 21/08/19
- Densley J., Toyota’s controversial HR strategy tipped to withstand challenges, https://www.smartcompany.com.au/people-human-resources/managing/toyotas-controversial-redundancy-strategy-likely-to-withstand-legal-challenges-experts/, last accessed 17/08/19
- Dowling J., Toyota announces five-year warranty, https://www.caradvice.com.au/714906/toyota-announces-fiv e-year-warranty/, last accessed 22/08/19
- Human Resources Director, What’s the number one HR challenge for Toyota, https://www.hcamag.com/au/specialisation/change-management/whats-the-number-one-hr-challenge-for-toyota/158113, last accessed 15/08/19
- Ketchell M., Toyota’s ‘low-productivity’ workers and the problem of low performance assessment, http://theconversation.com/toyotas-low-productivity-workers-and-the-problem-of-performance-assessment-6492, last accessed 18/08/19
- News, ‘Curry muncher’, ‘black c****’, ‘boat people’: Toyota sued over shocking abuse, https://www.news.com.au/finance/work/at-work/curry-muncher-black-c-boat-people-toyota-sued-over-shocking-abuse/news-story/0b5d8b6c35983c4b7bf438c42b8aca4f, last accessed 22/08/19
- News, Class action launched against Toyota over potentially defective filters, https://www.news.com.au/technology/innovation/motoring/motoring-news/class-action-launched-against-toyota-over-potentially-defective-filters/news-story/87880150ceca849b9a777cb0129acfc6, last accessed 14/08/19
- Newton B., Toyota “in front” Of Issues, https://www.motoring.com.au/toyota-front-issues/, last accessed 17/08/19
- Posky M., ‘Artisanal’ Child Labor Business Booming, Thanks to Electric Vehicle Renaissance, https://www.thetruthaboutcars.com/2018/02/ev-battery-child-labor/, last accessed 11/18/19
- Sardo S., Toyota; Was it ad HR, bad PR or just bad leadership, https://www.hrmonline.com.au/section/ahri-blog/toyota-was-it-bad-hr-bad-pr-or-just-bad-leadership/, last accessed 14/08/19
- Stelzer T., Toyota Hits 100,000 hybrid sales in Australia, https://www.finder.com.au/toyota-hits-100000-hybrid-sales-in-australia, last accessed 18/08/19
- Toyota Motor East Japan inc, Process until cars are complete, http://www.toyota-ej.co.jp/english/process/index.html, last accessed 21/08/19
- Toyota, All Roads lead to One Toyota, https://toyotadiversityreport.com/wp-content/uploads/2018/06/DI-Annual-Report_online-final-6.8.18.pdf, last accessed 22/08/19
- Toyota, Business Performance, https://www.toyota.com.au/-/media/main-site/sustainability/reports-2018/our-business/business-performance.pdf?la=en, last accessed 18/08/19
- Toyota, Toyota Australia Closes Manufacturing Operations, https://www.toyota.com.au/news/toyota-australia-closes-manufacturing-operations, last accessed 21/08/19
- Toyota, Toyota Australia Posts $206 Million After-Tax Profit, https://www.toyota.com.au/news/toyota-australia-posts-206-million-after-tax-profit, last accessed 22/08/19
- Toyota, Toyota Australia, https://www.toyota.com.au/, last accessed 22/08/19
- Toyota, Toyota Introduced Toyota Warranty Advantage, https://www.toyota.com.au/news/toyota-introduces-toyota-warranty-advantage, last accessed 20/08/19
- Toyota, Toyota Sustainability Report, https://www.toyota.com.au/-/media/main-site/sustainability/reports-2018/toyota-sustainability-report-2018.pdf?la=en, last accessed 22/08/19