替代威胁 – 适度
Fierce competition faced by the company because there are few organizations offering similar products and targeting similar international markets such as Honda, Volkswagen and Ford. Various buyers are such that they only buy one product from the company and there are very few organizations that purchase and only they have the bargaining power ability. Abundant options in the market and not much cost for consumers to make a switch between their current product choice and future product choice. Recent trends have indicated that there is a capability in the customer to look for those cars which are fuel efficient as the oil prices are tremendously raising. In turn this results in enhancing the hybrid cars demand offering cheap substitutes. Toyota’s cost cutting practice however benefits it in lowering the power of the buyer and putting its products in a beneficial state in comparison to others in the competitive market.
Still, the most convenient transportation method is a car for most people in urban and suburban regions. Various transportation methods are available such as by trams, metro or bus but they do not offer the same use, comfort, flexibility and value as offered by cars. The costs of switching the transportation kind can be higher with respect to time inefficiency and inconvenience. Higher costs of fuel can push customers to prefer transport for public but this cannot be a real car substitute. For solving this issue, the company of Toyota has always looked for innovation on its products in order to develop cars that are fuel efficient (Ahmadjian2001). Competitors of Toyota are developing consistently with regard to technological advancement, design enhancement, improvement of supply chain and hence enhancing quality.