It's no secret that US auto manufacturers are struggling lately. As consumers shy away from gas-guzzling SUVs and seem unwilling to buy new cars without steep discounts, Ford and GM have both seen their sales and market shares slip significantly this year. US sales at GM were down 7.5% in November 2005 compared to that same month a year ago, and Ford's decline was an even more staggering 15%. As a result of these sales declines, Ford and GM have both announced additional plant closings and layoffs over the last two weeks.
Then there's Toyota. Because of less reliance on SUVs and more innovative product development like the Scion and hybrid sedans, they are bucking the industry trend and actually growing sales in a tough climate. At the same time, they announced a few weeks back that they will increase their capacity in the US and hire additional manufacturing workers.
This is a good example of a strong industry player exploiting the overall weakness of competitors by getting more aggressive to take market share while others may be on the defensive. It's an entirely different way of thinking about business strategy that will most likely put Toyota in a better position once the overall industry rebounds. Executives at Toyota are aiming to become the world's #1 auto manufacturer in terms of sales volume by 2007, and this aggressive strategy puts them in a better position to achieve that goal.