With people in Japan showing less and less interest for cars, Japanese automaker Toyota Motor Corp. (NYSE: TM) is exploring more efficient methods to increase sales in its strong competition with rival General Motors Corp. (NYSE: GM) for the title of the world's largest automaker. The attempt to boost sales has become even more difficult as, according Toyota officials, young people prefer spending their money on laptops or mobile phones than a car that could be easily replaced by public transportation.In an attempt to reach younger people and lift car sales, Toyota is opening a new mall located in Yokohama, southwest of Tokyo. The new Tressa mall is pretty much like any other malls, with 220 stores and restaurants like cafes, clothing stores and even gym or games centers where people enjoy spending their time. However, in the new mall space, Toyota showrooms take center stage, placing at people's disposal a large variety of old and new cars models.
One thing that Toyota is aware of, and trying to improve upon, is that in Japan showrooms and TV advertising are not efficient any more in attracting people's interest for buying cars. The new mall is aimed at accomplishing Toyota's plan of global domination by providing "opportunities for people to come in contact with cars."
For the moment, is unclear if Toyota's plan will be successful. In addition, the Japanese automaker is showing concerns about its global sales target for this year, which was set at 9.85 million. The company is blaming both the weakening U.S. economy and higher raw material prices. In the United States, car demand has been declining, hurt by the tight credit crisis, tumbling dollar and surging crude prices that put pressure on consumer spending.
With the current market conditions, Japanese car makers are facing a tough environment as the yen has been rising against the dollar. But with this new strategy and Toyota's ambitious plans to defeat the competition, it could be just a matter of time before it gets back people's interest for its car models.
Eliza Popescu is a financial writer for the online investment advisory service Investor's Observer.
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