Toyota to launch MPV roll-out

"The preference for the small cars in the country at present is a compromise choice because of price factor and an average middle class family really needs a mid-size car. As the real income grows, the demand for bigger cars is expected to increase", he said.

Toyota Kirloskar, which is an 87:13 joint venture between Toyota Motors and Kirloskars, signed an MoU with the Directorate General of Foreign Trade (DGFT) for importing auto components yesterday. Yamazaki said the company would consider introducing the passenger car by 2004-5 but declined to divulge which particular model Toyota had in mind.

Already, the company has made an investment of Rs 600 crore at Bidadi near Bangalore and targets to sell 31,000 vehicles in the first year of its operation. "The target of 31,000 vehicles would be slightly on the optimistic side. But we could sell anywhere between 20-30,000 units", the company’s deputy Managing Director K K Swamy said.

Trial production of the MPV had already commenced and commercial production was likely to begin by the year-end, Swamy said, adding the company had a initial peak capacity of 50,000 units. The MPV, which will have a passenger car ambience, was similar to the Kijang model that Toyota had introduced in Indonesia, he said.

He said the company would achieve a 55 per cent indigenisation level in the first year itself and localise 70 per cent of its components by 2004. The company had indicated in its MoU with the government that it would import 544 million dollars worth of goods in five years, Yamazaki said.

As per the MoU policy, any company wanting to import components or CKDs/SKDs have to indigenise their production upto 50 per cent in three years and 70 per cent in five years. "We will not be importing CKDs from abroad. Almost all components including body panels, press parts, plastic parts and radiators are made either in-house or sourced from local manufacturers", Yamazaki said.

The company will be sourcing a major part of its requirements from Toyota technopark situated in Bangalore. Companies like Araco Polyflex, T G Kirloskar, Stanzen Toyo Tetsu, Steel and Logistics Centre, Koyoseiko and Trans Systems were located in the park, he said.