Introduction to Business



This business essay provides a review of Lexus Car Company. The company started its operations in the early 1980s. Its official launching took place in 1989 in the U.S.A. which saw the company being associated with the manufacture of quality, luxury vehicles that gave customers the ultimate satisfaction. The brand name of the company saw rapid growth making the company become America’s best-selling line of luxury vehicles. Lexus Car Company is a member of the Toyota family (Dawson 2004). Toyota family makes up be the world's third-largest manufacturing automobile manufacturers.


Lexus headquarter is located in Nagoya, Japan with many operational centers in other parts of the world. The Lexus Group management under the Kiyotaka Ise coordinates the global operations of the company. The key stakeholders of Lexus car company are shareholders, employees of the company, customers, business partners, community, and the global society as a whole.

  • Customers

The company holds the philosophy that their customers are their main concern and they come first. The company aims to develop and provide to the consumer products that are innovative, safe, and of outstandingly high quality (Mahler 2004). The company also aims to protect customers’ personal information as well as of all other participants.

  • Employees

The company respects its employees bearing in mind that the success of a business comes as a result of their creativity and upholding of teamwork. It supports employment opportunities, diversity and ensures no discrimination among employees. Workers are provided with ample working conditions and their safety and healthy working environment is maintained. Human rights are highly upheld by the company. Company management also takes the initiative to foster leadership training to cultivate a corporate culture and also implement sound policies that promote ethical behavior in business.

  • Business partners

The company respects its business partners, suppliers, and dealers by ensuring mutual long-term relationships aimed to achieve higher growth based on mutual trust. The company ensures free and fair competition held by a specific country’s competition laws.

  • Shareholders

The company strives to promote corporate value while it achieves stable and long-term growth which benefits shareholders of the company. The shareholders have timely and fair disclosure of the company operating results and the financial position of the company.

  • The global society

The company aims to develop in harmony with the environment. It aims to reduce the environmental impact of the business operations. The company ensures that it minimizes the effects of its vehicles and operations on climatic changes, conditions, and biodiversity. The company is also out to promote the development of technologies that enable the environment and economy to coexist (Morgan & Liker 2006). The Company also joins efforts with environmental preservation programs to preserve the environment.

  • Community

The company upholds respect for people by honoring their culture, the existing customs, their history, and the laws governing each particular country. The company works towards maintaining a safer, cleaner, and high-quality technology that meets the changing needs and demands of society. The company does not encourage acts of bribery to or by any business partners, government agencies, or state authorities. It maintains honest and fair relationships with all those stakeholders. The company actively encourages the participation of individuals and partners in social contribution activities that help promote and strengthen communities and positively contribute to the enrichment of society.

Environmental Factors of PESTLE

The PESTLE analysis incorporates political, economic, social, technological, legal, and environmental factors in which a business entity operates. The environmental factors analysis includes all the factors that come about as a result of the surrounding environment. It integrates ecological and environmental aspects that potentially can affect industries. The growing awareness of the potential effects of such factors is a key determinant of how companies carry out their operations and also affects the products they offer to their customers. The company operations and the products offered help create new markets and diminish or even destroy the existing markets.

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The company widely recognizes environmental conservation on a global basis. Lexus Company believes in the production of safe cars and of high quality to meet their customers’ expectations. A current study carried out shows that by 2020, there will be as many as 1.5 billion cars on roads (Laban 2007). Although this projected trend implies people get more vehicles, it also comes with environmental challenges. A 30-degree approach has been adopted to help towards achieving zero-emission and zero waste at each stage of the automobile life cycle.

Measures on global warming - greenhouse gases are a result of burning fossil fuels. These gases influence the atmosphere composition, thus, affect the weather in the world. The increased emission of human-induced greenhouse gases like carbon (IV) oxide has led to global warming, whereby a greater percentage of the harmful gases are generated by the transport sector. Measures aimed at reducing environmental burdens linked to the production, use, and disposal of vehicles should be implemented to help sustain a cleaner planet for the benefit of ourselves and future generations.

Diversification of energy - the future economic and social development is determined by an adequate supply of energy. Energy demand shortly will be high, thus, efforts should be made to ensure efficient use of energy generated from oil (Robinson 2007). Alternative sources to fossil fuels such as hydrogen and biofuels should also be utilized for the transport sector since such fuels generate lower harmful emissions.

Improvement of air quality- burning of fossil fuels by the engine leads to emission of nitrogen oxide and other pollutants. Diesel cars emit larger amounts of such pollutants. These emissions contribute to air pollution, thus, impacting negatively on the respiratory system of the population leading to further health problems (Vasilash 2006). Emissions from volatile organic compounds generated when painting vehicles pollute the air quality in the environment.

Efficiency in recycling and resource use - preservation of natural resources will help preserve our environment. We should also aim to use renewable sources of energy. The motor industry should save on water by ensuring waste reduction, reuse and recycle processes.

Elimination of hazardous substances - these are substances that cause long-lasting damages to the environment if they are buried unprocessed. These include mercury, cadmium, and hexavalent chromium. Vehicles are easier to recycle as the substances are eliminated from the process of production.

Environmental Factors which Have the Most Impact on Motor Industry

Global warming preconditioned by carbon emissions and recycling of motor vehicles presents a fundamental environmental issue. The scrapping of motor vehicles yields large quantities of steel, rubber, glass, and fluids. This poses a massive logistical and environmental threat. The automotive industry requires the manufacture of more fuel-efficient vehicles and the way they are built and their recycling process (Long 2001). The above considerations during the production of vehicles help to minimize the wastes going to landfill and also help to conserve raw materials. The European Union requires that most of the parts of a car should be recycled.

The industry is coming up with the design of lighter-weight vehicles. These vehicles help conserve natural resources and reduction of fuel consumption. It also minimizes emissions, brake wear and improves handling and braking performance. Such vehicles are subject to less costly in terms of recycling and disposal.

What the Organization Should Focus On to Respond to the Selected Factors

The company should keenly focus on a better development plan. In other words, the company should aim at laying down the foundations for a better future. It should also monitor and reduce emissions to the environment and should be active in the community to contribute to its success. The company should aim at promoting the achievement of a sustainable environment and implement those plans worldwide to help increase electricity usage while reducing carbon usage (Ohnsman 2007). An enhanced development plan provides important policies on Lexus corporate social responsibility. These are aimed at delivering environmental benefits for Lexus and its subsidiaries and also benefit the community through educating it on energy-saving practices.

The Lexus manufacturing site has achieved a zero-landfill status whereby wastes for the manufacturing processes are recycled, repurposed, and used to generate additional energy. The company has also adopted in-plant water use and scrap material generation. There have also been improvements in plant energy efficiency to help minimize greenhouse gas emissions that are by-products of power generation (Schweinsberg 2005). The Lexus Environmental Assistance Network has developed a website that provides updated information on waste management information to all company dealers.

How Lexus will Perform in the Future Using Three PESTLE Factors

Political factors are related to government policies and regulations. These include taxation policies and trade tariffs. Lexus Company imports some vehicles and parts from other countries, hence, has to pay tariffs for the purchases. In the case where the government increases the import tariffs of such parts of vehicles, this will directly increase the pricing policies of the vehicles in that the cost of production will also increase. Thus, the company will face fluctuation in the costs of the vehicles and this may affect the rate of purchases.

Technological factors are among the most important factors of environmental impact to organizations. Lexus Company should invest in research and development to cater to the ever-changing technology in the modern world to remain competitive in the motor industry. This will enable the company to respond to the emerging demands of the consumers on superior modes of vehicles (May 2006). Investment in innovative and creative technology will help provide more valuable opportunities, particularly for solving the issues of energy consumption. The company should also invest in electricity and wind power technologies to help achieve resource utilization and production growth.

Economic factors affect the spending of people by changing their purchasing power of certain products. The economic gains of Lexus Company may be affected by economic crises, a decrease in salary, and a high level of unemployment. An increased level of unemployment and reduction of income will affect negatively the economic gains of the company since people will have less income at their disposal. Hence, the purchasing power of a considerable part of the population will be reduced.


Lexus Company should cope with current economic changes that affect the buying power of its customers. With increased utilization of the technology in the market, Lexus has the advantage of hybrid car technology that has more chances to gain popularity among customers since it is environmentally suitable. The company should uphold the production of quality environmentally viable products to remain competitive in the motor industry, especially now when the bargaining power within the industry is high and there are more competing producers of similar products, thus, customers have a wider variety of choices on what product to buy.

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