Report of Toyota Fun-Vii Entering China and Saudi Arabia MarketIntroductionThis report is about advising Toyota on branding for their forthcoming motor vehicle: Fun-Vii as they are evaluating requirements for China and Saudi Arabia’s auto market. Fun-Vii has been defined as the model of the future motor vehicle which has come with touch screen doors, digitally customizable exterior and interior, collision-avoidable tech, car-to-car networking, and many more other hi-tech equipment. (Thornhill, 2011)By using brand management theories such as Brand Extension Theory, Brand Loyalty Theory, Global Branding Theory and Co-branding Theory and the use of academic analysis, this report helps Toyota in evaluating the brand position of Fun-Vii so as set up an effective brand strategy before it enters the Asian market. The Asian auto market: China & Saudi ArabiaThe auto market of ChinaChina has emerged from the global recession as the world’s largest auto market.
Its new vehicle sales reached 13.6 million units and total output hit 13.8 million units, up 46.2 percent and 48 percent from 2008. China’s auto market is poised for more impressive growth, according to recent China association of Automobile manufacturers; China produced 7.5 million cars and sold 7.6 million cars within the first five months of 2010.China’s accession to the WTO has promoted its auto industry and the economy.
Chinese and foreign auto Industry are facing the development of Chinese automobile where China will have over 200 million households with car capacity. The auto market of Saudi ArabiaSaudi car market is very young and they are interested in developing environmentally friendly cars. In Saudi Arabia, Toyota brand has good reputation so any new car produced will easily sell. The kingdom of Saudi Arabia is one of the most important amongst the developing ones; in 2001 it represented $40 billion-worth of yearly export to international markets.
Saudi Arabians are looking forward to embrace any new technology (Bhuian, 1997)Target MarketSaudi Arabia and China are very different in terms of geographical location, culture, economy and other fields. However, the two countries have strong purchasing power in terms of potential markets and young potential consumers. There is a sufficient number of youths in both countries who would be attracted to the Fun –Vii owing to its stylish function and would afford to buy it.
The Fun-Vii could successfully borrow the Toyota brand influence which would result in a good sales performance in the two countries. The huge market must also attract many competitors. In the automotive industry, if a company at the onset does not achieve successful branding, it faces an extremely tough competition test. The Toyota brand faced decreased popularity among consumers following its recalls but it is slowly improving owing to the company’s commitment to better performance in the future. ToyotaToyota Motor Company Limited is Japanese Company established in 1937 and later merged with Toyota Sale Company Limited to create today’s Toyota Motor Corporation in I982.
Its main business activity is the production and sale of motor vehicles though but has investments in other business activities including real estate, marine biotechnology and environmental conservation through afforestation. It provides employment for more than 350, 000 people around the world. The company started its international marketing efforts in the mid 1950’s and sought to adapt its design and production to meet the needs of customers in whichever region they found themselves.
The company has manufacturing plants in over 170 countries and is the second largest automotive company after General Motors (Toyota, 2002). Toyota’s success may be attributed to its development of technologically advanced products and an efficient production system (Toyota, 2006). Its model of excellence places particular importance on philosophy, people, problem solving and process. The brand Toyota was renowned for its good quality, dependability and customers always reported satisfaction upon using the products until its recall of 3.8 million vehicles in November 2009.
Prior to the recall, a study in the United States reported that 83% of adults expressed confidence in the brand displaying that many people believed in the brand. After the recalls in 2009 and 2010, customer confidence fell to 59%. However, Toyota changed its motto to Moving Forward which implies their commitment to better products. Customer confidence has continued to recover and had reached 70% by December 2011 (Kelly, 2012).