Toyota Kirloskar to join small car bandwagon by end-2010, launches Land Cruiser

10 June 2009

Toyota Kirloskar said on Tuesday that it will launch its small car by the end of 2010, by when its plant in Bangalore is expected to be ready. The initial capacity has been set at 70,000 cars a year.

The second Indian plant is being built at a cost of about Rs3,000 crore in Karnataka, where its first plant is also located, said Sandeep Singh, a deputy managing director at Toyota Kirloskar Motor India Pvt Ltd.

The compact car will be made specifically for the Indian market, Singh said at the Indian launch of Toyota's popular Land Cruiser sports utility vehicle in Mumbai.

Japan's Toyota Motor Co, which owns 89 per cent of the Indian venture, had planned to start the second plant with annual capacity of 100,000 units, but this had been scaled down because of the downturn in the auto sector. ''The demand for vehicles has fallen by 30 per cent," Singh said, adding that "We can easily ramp up capacity to 100,000 units, when we want."

Having cut output at its existing Indian plant by 20 per cent between November and May as demand fell, Toyota is raising capacity to return it to 65,000 vehicles a year, he said. The plant is expected to produce 4,300 vehicles in June and up to 5,300 units in July.

The company has not yet decided on the price of the small car, but it would run on petrol, he said. About 70 per cent of the inputs for the car would be sourced from within India. "If we do not source inputs within India, then it won't be cost- competitive," Singh said.