Automotive Production Levels
By
Mansi Teraiya
Submitted to: Dr. Vandana Mahajan
Managerial Economics and Globalization
09/09/2012

1) Brief History of Toyota Motors
Toyota Motor Corporation (TMC) is a Japanese multinational automaker headquartered in Toyota, Aichi, Japan. Into 2010, Toyota employed 200,734 people worldwide and was the second largest automobile manufacturer by production. Toyota is the ninth largest company in the world by Revenue.
In July, 2012 the company reported that it had manufactured its 200 millionth vehicle. The company was founded by Kiichiro Toyoda in 1937 as a spin off from his father’s company Toyota Industries to create automobiles. 2) Demand Supply Analysis for Toyota Motors
To demonstrate the relation between supply and demand of TM worldwide let us focus on production and sales data of TM for last few years. Below are the two tables for TM Production and Sales.

From the sales and production data above, we can see that the overall production of TM cars is consumed in the market more than 90% by the consumers. We can observe that there is constant increase in production and sales till year 2008. In 2008, there was an economic slowdown in the world, which impacted production and sales of Toyota motors. From 2010 and 2011 figures, we can see that TM has done well to recover from the recession and we can see that their sales is more than their production in these years.
Factors affecting Demand-Supply of TM:
At a particular price point, demand of a product is affected by many factors. For example, the price of the crude oil increases from $ 40 to $60 per barrel (approx. 2007 rates of oil), the fuel efficient vehicles of Toyota Motors are likely to be sold better. Hence the demand curve of TM shifts to the right in below diagrams.

* Income Effect: Demand for normal good increases as income of consumer rises.