1. EMBA/CM02 BADM 423 Toyota Corolla Terry Brewer Diane Buckner Ted Buckner John Fernandez Tim Harclerode

2. EMBA/CM02 BADM 423 Notes on Toyota Largest carmaker in Japan Number 4 in the world (behind GM, Ford, and Chrysler) Producer of cars, trucks, and SUVs

3. EMBA/CM02 BADM 423 Toyota Corolla Introduced in 1968 Over 20 million sold worldwide Over 10 million sold in the US

4. EMBA/CM02 BADM 423 The Corolla Line Base DX Wagon (introduced Yr3/Q2)

5. EMBA/CM02 BADM 423 The Press Says: “Corolla is one of the world’s best little sedans and a clear BEST BUY. It’s not the cheapest sub- compact around, but resale values are high, and Toyota’s reliability record is unsurpassed.” ’99 Consumer Guide

6. EMBA/CM02 BADM 423 Customers Commuters New Families Traditionals

7. EMBA/CM02 BADM 423 Decision #1 for Y2/Q2 Production 52,200 units Projected Sales 57,200 units Finance Rate7.9% Dealer Incentive250

8. EMBA/CM02 BADM 423 Results Y2/Q2 Actual Sales 56,190 units Unit Share8.8% Net Contribution$122.7 million

9. EMBA/CM02 BADM 423 Decision #2 for Y2/Q3 Introduced Safety Upgrade Production53,000 units Projected Sales61,000 units Finance Rate1.9% or Rebate$25

10. EMBA/CM02 BADM 423 Results Y2/Q3 Actual Sales 68,320 units Unit Share10.8% Net Contribution$206.7 million

11. EMBA/CM02 BADM 423 Decision #3 for Y2/Q4 Production53,000 units Projected Sales58,000 units Finance Rate1.9% or Rebate$25

12. EMBA/CM02 BADM 423 Results Y2/Q4 Actual Sales 49,600 units Unit Share8.0% Net Contribution$43 million

13. EMBA/CM02 BADM 423 Decision #4 for Y3/Q1 Production48,000 units Projected Sales56,000 units Finance Rate1.9% or Rebate$1,250 (on Base) $ 25 (on DX)

14. EMBA/CM02 BADM 423 Results Y3/Q1 Actual Sales 56,369 units Unit Share9.1% Net Contribution$135.4 million

15. EMBA/CM02 BADM 423 Decision #5 for Y3/Q2 Introduced Wagon Production59,000 units Projected Sales62,000 units Finance Rate1.9% or Rebate$ 750 (on Base) $ 25 (on DX) $1500 (on Wagon)

16. EMBA/CM02 BADM 423 Results Y3/Q2 Actual Sales 53,261 units Unit Share8.8% Net Contribution$102.6 million

17. EMBA/CM02 BADM 423 Cumulative Results Y2/Q2 - Y3/Q2 Unit Sales283,740 Net Contribution$610.4 million

18. EMBA/CM02 BADM 423 Contribution

19. EMBA/CM02 BADM 423 Economic Indicators

20. EMBA/CM02 BADM 423 Net Contribution vs. Total Small Car Sales

21. EMBA/CM02 BADM 423 Lessons Learned Be conservative with regard to economic forecasts Try to distinguish yourself from the competition Never lose track of your target customers Be first with an innovation or be better A small return on sales is better than lost sales

22. EMBA/CM02 BADM 423 Lessons Learned (cont.) Unless you put yourself completely out of business, there’s always next quarter!

23. EMBA/CM02 BADM 423 Thank You Questions?