Transcript
WELSH JOINT EDUCATION COMMITTEE
CYD-BWYLLGOR ADDYSG CYMRU
General Certificate of Education Advanced
Tystysgrif Addysg Gyffredinol Uwch
326/01 BUSINESS STUDIES BS6 P.M. THURSDAY, 24 June 2004 (13⁄4 hours)
ADDITIONAL MATERIALS In addition to this examination paper, you will need: a calculator. a 12 page answer book; INSTRUCTIONS TO CANDIDATES Answer all the questions. INFORMATION FOR CANDIDATES This paper is a synoptic paper. It is designed to test candidates on the connections between different aspects of the subject and requires the integration of knowledge, understanding and skills acquired from different parts of the subject content. Mark allocations are shown in brackets. Candidates will be assessed on their quality of written communication i.e. the structure and presentation of ideas; the clarity of expression; grammar, punctuation and spelling. Up to three marks will be awarded for written communication. No certificate will be awarded to a candidate detected in any unfair practice during the examination.
TJ*(0007/23)
2
Study the information provided about Toyota and then answer the questions that follow.
TOYOTA’S MISSION STATEMENT
“Toyota seeks to create a more prosperous society through automotive manufacturing.” TOYOTA'S VISION “Toyota aims to achieve long-term stable growth in harmony with the environment, the global 5 economy, the local communities it serves, and its stakeholders.” TOYOTA'S HISTORY Toyota’s history goes back to 1918, when Sakichi Toyoda revolutionised the Japanese weaving industry with the invention of the world’s first automatic loom. Proceeds from the sale of production rights to a British company enabled Sakichi's son, Kiichiro, to invest in the development of automotive 10 technology. Toyota’s first passenger car was launched in 1936. One year later, the Toyota Motor Company was born. Since that time, Toyota has built one vehicle every 20 seconds, with a cumulative production total in excess of 90 million units. The export of vehicles from Japan started in the 1950s. 1959 saw the start of production in other countries, and Toyota cars are now produced in 26 nations around the world. 15 Toyota is the seventh biggest company in the world, and the third largest car manufacturer. It also has interests in house construction, boat building and telecommunications. Its network of plants spans the globe, with 65% of vehicles sold outside Japan being made outside Japan: one million a year in North America, 600 000 a year in Asian countries and 200 000 a year in Europe. There are currently three Toyota plants in Europe - at Burnaston and Deeside in the UK and a third at Valenciennes in France. 20 Localised vehicle production is an important way in which Toyota makes a contribution to different countries, by providing mutually beneficial long-term relationships with local companies and a commitment to the employment of local labour. Toyota leads the world in automotive innovation. Five per cent of annual net sales (over £2 billion per year) is invested in new technology and the development of new products - more than any other 25 manufacturer. Toyota is playing a leading role in the development of Intelligent Transport Systems (ITS) technology, such as automatic pilot systems. In addition, 50% of all its research and development into engine technology is focused on the search for alternative fuel sources, reinforcing the positive links between Toyota and the environment.
(0007/23)
3
Table 1 - The Top Ten Car Manufacturers in the World in 2001 Make 1 2 3 4 5 6 7 8 9 10 General Motors Ford Toyota Volkswagen Daimler Chrysler PSA Peugeot Citroen Honda Nissan Renault Fiat Total Vehicles 8 560 000 6 991 000 5 928 000 5 084 000 4 479 000 3 133 000 2 634 000 2 580 000 2 409 000 2 126 000
TOYOTA TODAY 30 Automotive operations are Toyota’s most significant segment, accounting for approximately 90% of its total revenues. Toyota’s primary markets, based on vehicle unit sales for 2003, were Japan (36%), North America (32%) and Europe (13%). The worldwide automotive market is highly competitive and cyclical. Demand for automobiles in each market can vary substantially from year to year. Demand depends to a large extent on general economic 35 conditions in a given market, the cost of purchasing and operating automobiles, and the availability and cost of credit and fuel. Toyota’s share of total vehicle unit sales in each market is influenced by the quality, price, design, performance, safety, reliability, economy and utility of its vehicles compared with those offered by other manufacturers. The timely introduction of new or modified vehicle models is also an important 40 factor in satisfying customer demand. Toyota's ability to satisfy changing customer preferences can affect its revenues and earnings significantly. Changes in laws, regulations, policies and other governmental actions can also materially impact on the profitability of Toyota’s automotive operations. These factors include those affecting environmental matters and vehicle safety, fuel economy and emissions that add significantly to the cost of vehicles. 45 Many governments also impose tariffs and other trade barriers and enact price or exchange controls which can limit a car manufacturer’s operations and can make the transfer of profits to a manufacturer's home country difficult. The worldwide automotive industry is in a period of globalisation and consolidation, which may continue for some considerable time. As a result, the competitive environment in which Toyota 50 operates is likely to intensify. Toyota believes it has the resources, strategies and technologies in place to compete effectively in the industry as an independent company for the foreseeable future.
(0007/23)
Turn over.
4
TOYOTA IN EUROPE In 2001 Toyota sold 666 000 vehicles in Europe giving it a market share of 3.8%. In the passenger car market, Toyota was ranked ninth. It had the number one market share in both Finland and Norway. In 55 the UK 3593 people are employed at the Burnaston plant which opened in 1992. In 2001 the plant, which manufactures the Avensis and the Corolla, produced 153 415 cars. Toyota’s Valenciennes plant in France produced about 60 000 units of the Yaris in 2001, rising to 150 000 in 2002. Toyota is concerned that Britain has not yet adopted the single currency (the euro) as the following three paragraphs adapted from the Guardian newspaper clearly indicate. 60 The head of one of the world’s biggest car companies reignited the debate over the single currency yesterday with a warning for the Government that its £1.5bn investment in the UK would be at risk if Britain stayed out of the euro. Executives of Japan’s biggest car manufacturer, Toyota, which employs thousands of workers at plants in Derbyshire and Deeside, said they could no longer sit on the fence as Britain decides whether or not 65 to enter the single currency. “Waiting for a decision is really hurting us and it is time to state very clearly to the British public that we want Britain to join the single currency,” said Shoichiro Toyoda, honorary chairman and former chief executive officer of Toyota. TOYOTA'S PRODUCTION SYSTEM (TPS) 70 The practical expression of Toyota's people and customer-oriented philosophy is known as the Toyota Production System (TPS). This is not a rigid company-imposed procedure, but a set of principles that have been proven in day-to-day practice over many years. Many of these ideas have been adopted and imitated all over the world. TPS has three desired outcomes: 75 to provide the customer with the highest quality vehicles, at lowest possible cost, in a timely manner with the shortest possible lead times; to provide employees with work satisfaction, job security and fair treatment; to give the company the flexibility to respond to the market, and to achieve profits through cost reduction activities, thus providing long-term prosperity. 80 TPS strives for the absolute elimination of waste in all areas to allow employees to work smoothly and efficiently. It has become the basis for highly efficient “lean” manufacturing in industries worldwide. The foundations of TPS are built on standardisation to ensure a safe method of operation and a consistent approach to quality. Toyota employees seek to continually improve their standard processes and procedures in order to ensure maximum quality, improve efficiency and eliminate waste. This is 85 known as kaizen and is applied to every sphere of the company's activities.
(0007/23)
5
TOYOTA’S FINANCIAL STATEMENTS 2002-3 Table 2 - Toyota’s Trading and Profit and Loss Account 2002-2003 2003 (£m) 83176.4 63928.1 19248.3 12425.1 6823.2 2002 (£m) 76140.7 58348.9 17791.8 11923.7 5868.1
Sales revenue Cost of sales Gross profit less expenses Net profit Table 3 - Toyota's Balance Sheet 2002-2003
2003 (£m) Fixed assets Current assets Less current liabilities Net current assets Total assets less current liabilities Long-term liabilities Net assets Shareholders’ capital 60052.9 37849.2 22203.7 70285.2 32076.2 38209.0 38209.0 48081.5
2002 (£m) 45937.9 57650.5 35800.7 21849.8 67787.7 28810.8 38976.9 38976.9
Sources: the Toyota website www.toyota.co.uk; the Guardian 18 Jan 2000 1. 2. 3. 4. How can Toyota attempt to ensure that it maintains its share of the car market? Using Tables 2 and 3, comment on Toyota’s liquidity and profitability. [8] [8]
“The Toyota Production System (TPS) is the key to the company’s long-term prosperity.” Discuss. [10] “Waiting for a decision is really hurting us and it is time to state very clearly to the British public that we want Britain to join the single currency.” (Lines 66-67). Comment on the advisability of Britain adopting the single currency (the euro). [12] To what extent are Toyota’s mission statement and vision (lines 1-5) likely to conflict with its need to make a profit? [12]
5.
(0007/23)