Honda vs Toyota
Honda and Toyota have been two leading competitors in the automobile business for several decades. Both being rivals in the foreign Japanese market and in the United States as well. Over the years, both have created compact cars, sport utility vehicles, sports cars, minivans, mid-sized vans, and hybrids. These two companies have flourished in the American automobile industry and have gained the loyalty of many customers. Now a days, cars have to meet strict emission laws based on California criteria due to the high level of pollution. The government has even had to step into the industry making manufacturers produce cars with catalytic converters. Toyota and Honda have taken these aspects into affect by creating the Honda Civic and the Toyota Corolla. Honda has actually set the standard for the compact car, making the Civic one of the most U.L.E.V (Ultra Low Emissions Vehicles) in the industry. Toyota on the other hand has set the standard for the mid-sized vehicle with the Camry. Ever since Toyota introduced the Camry sedan in 1983, it has become the best passenger car for the last four years in America. According to the Insurance Institute for Highway Safety, the Honda Civic and the Toyota Camry received the
The price of a car would vary on the person who is buying it. If a person who made only $10,000 a year bought a $20,000 car, then the price would be a large percent of income for that person. However if someone who made $100,000 a year bought a $20,000 car, then it would be small percentage of his or her income. The car industry is an oligopoly, where there are only a few sellers. With companies like Honda and Toyota, entering into the car industry would be quite hard. The new comer would have to have a lot of experience, expertise and money in order to compete and make a profit against all of the other leading car manufactures including Honda, Toyota, General Motors, Ford, Mazda and Nissan, to name a few. There are so many factors that deal with "Barriers to Entry" and those factors can, at often times, discourage people from entering into the industry. Trying to get into the car industry would be quite hard and I think that the new comer should reconsider their idea and try to get into another industry where there is not a barrier to entry. There are legal issues, licenses, managerial skills, consumer loyalty, technolocigal expertise, location, in-place network system of sales representatives and service representatives, resources, distribution costs, labor, government regulations and price discrimination that one must consider before entering. The idea of something and the reality of it are very different, especially if your idea is to create a new car manufacturing company from scratch. Some of these companies have been established for almost a hundred years and entering now would only mean disaster. The % rise in the Price of the Toyota Corolla 4% Another way to help suppliers raise productivity is learning by doing. As employees, gain more experience with their jobs, they can be more efficient job wise and produce more products. Employees with experience and high productivity can help the company use their resources efficiently and cut down on costs as well. This technique can strengthen the company dramatically by having diligent employees. 2. Is the product or service a luxury or necessity? buyers are starting to buy cars, but their tastes are quite different from those of their older generation. Using this information Honda and Toyota are constantly doing research and development to create new and different styles of cars for all age groups. Honda has invested more than seven billion dollars to create some the best selling cars. With the seven billion dollars, Honda has built a new production plant in Alabama and has also created several new models like the MDX, Pilot, S2000, CL, TL, and the Odyssey to keep up with the demand of the consumers. Toyota has also kept up with the pace and created the Prius, Tacoma, Solara, the new Celica and the Avalon. In order to keep up with each other, each company must invest lots of money into research and development to cope with the changing tastes of the consumers. One thing for sure is that car companies do not want the government to come into their industry and set price controls. With price controls in affect, Honda and Toyota can lose a great deal of money. Price controls cause problems like unemployment, inconvenience, low wages and poverty. For example if the Honda Insight is $20,000, but the government came in and said that Honda can only sell it for $15,000 because the government wants more people to drive low emissions vehicles. Honda, of course, would be outraged because it costs them $15,000 to make the Insight. They would not be making a profit but would probably have to spend more to meet the demand of the buyers. Honda would make no profit at all, which means Honda would have to take funds from other departments to pay its workers. However, if Honda was only capable of making so many Insights, but the demand for them kept on growing then there would be a shortage. In order to meet the demand of the buyers, Honda must develop methods
Some common words found in the essay are:
Honda Toyota, Amtrak Caltrains, Barriers Entry, Honda Insight, Honda Civic, Celica Avalon, Toyota Camry, North American, CRV RAV, SEC IRS, honda toyota, rise demand, car industry, honda civic, raw materials, toyota corolla, low emissions, set standard, demand civic, price controls, industry hard comer, manufacturers honda toyota, sport utility vehicles, bought $20000 car, car industry hard,
Approximate Word count = 2937
Approximate Pages = 12 (250 words per page double spaced)
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