Case Study: TOYOTA: Driving the Mainstream Market to
Purchase Hybrid Electric Vehicles
Rockford College Graduate School
BSAD Marketing 560
November 29, 2011
Case Study: Toyota: Driving the Mainstream Market to Purchase Hybrid Electric Vehicles
“What is the role in society, the size, growth and evolution of the auto industry? How have the Japanese auto manufactures led (auto) category innovation? What is Toyota Motors market position in the United States for the hybrid vehicle category?
“The automobile industry has changed the way people live and work, and the way businesses operate.” (Ivey, p. 2) The automobile itself is ingrained as a permanent ...view middle of the document...
Toyota aggressively proclaimed first mover advantage in the Hybrid Electric Vehicle industry (HEV) by launching a new market strategy:
Shaping, not following, market conditions in America. The company exceeds environmental standards by introducing bridge technologies like the Prius electric-gas hybrid [that] has put Toyota in the driver’s seat when it comes to environmental excellence.” (Ivey, p. 5) The bold new strategy put Toyota in a league of it’s own as the only clean manufacturer.
What impact do government environmental legislation, regulation and investment have on the auto industry? How close is the fuel cell technology to successful mainstream implementation? What are the leading technologies (PEV and HEV), and how do they compare in their possibilities for becoming the industry standard? What are their advantages compared with the conventional internal combustion engine?
Governmental environmental legislation, regulation and investment has a significantly power impact on the auto industry. The state of California is recognized for being a leader in environmental protection and an initiator in establishing environmental programs to reduce the risk of pollution. “Based on history and precedence, it is safe to assume that the legislation that has been adopted and accepted in the state of California, will eventually permeate to the rest of the nation, and be adopted into federal law.” (Ivey, p 6) The federal mandates and regulations throughout select areas of the United States have motivated manufacturers to invest in the development of new technologies and innovations. As the laws began to change, so did the product. This a defining moment in the evolution of the automobile industry, manufacturers were attempting to meet the current demands of a gas guzzling society while attempting to create new technologies that would define the way people purchased vehicles.
Fuel Cell Technology is considered by most to be the cleanest form of vehicle, because its’ only byproduct is water. Most experts agree that fuel cells technology has a long way to go before it is considered reliable, durable, cost-efficient and able to be mass produced. More money, time and research are required before successful mainstream implementation can be considered.
Pure Electric Vehicles (PEV) are cars that run entirely on batteries, resulting in zero tail pipe emissions. PEVs required the need to recharge or plug in battery for traveling any long distances. PEV were challenged with limitations such as lack of power, long charge times and cold weather issues. (Ivey, p. 9) In 2003 production of PEV stopped as manufacturers began to invest more research into Hybrid-Electric Vehicles (HEV). HEV’s utilize “Hybrid technology combines an electric motor with a gas or diesel-powered engine to both increase fuel-efficiency and lower emissions.” (Ivey, p. 9) HEV reduced tailpipe emissions by almost 30 percent. (Ivey, p.9) There is truly no...