Toyota - Case Study

Example of:

• A trans-national company in an MEDC (UK)
• Investment from overseas in an MEDC
• Location of a named factory
• Location of a secondary economic activity

Toyota is the world's third largest manufacturer of cars. As a TNC it has its head office in Japan, and component factories, assembly plants and selling outlets throughout the world. The company decided to open a vehicle manufacturing plant in Europe as Europe is the world's largest market for cars.

Reasons why Toyota chose to locate in the UK rather than another country in Europe:

• There is a large market for cars in the UK
• Vehicles have been manufactured in the UK for a long time
• Car components are already made by many firms
• Good communications with the rest of Europe
• Support from the Government at national and local levels

Why did they choose to open a car plant at Burnaston, Derby?

• Room for expansion on a greenfield site 8km from the centre of Derby
• Large expanse of flat land available, over 100 hectares
• Central position in UK for the home market
• Lots of unemployed skilled workers living nearby, recent job losses at Rolls Royce in Derby
• Many car component firms located near by in the West Midlands
• Good road access, needed for the 'just-in-time' policy
• Near to national rail network
• Support from the Government available

Benefits to the area and the UK

• More jobs created (multiplier effect on that)
• Many parts supplied from the UK- 220 suppliers from European countries
• Improved transport - new rail station at nearby Wellington, new M1
• More people are attracted to the area (multiplier effect - house prices rise)
• 4700 new houses built

Problems

• More people - more traffic - higher risk of accidents - increased air and noise pollution
• More demand for local services - lack of space in schools - more demand for health services
• More houses built - more habitats destroyed