Toyota Motor Corporation, one of the world's biggest automakers, on Thursday set the ball rolling for a compact car for the Indian market by laying the foundation stone for a Rs 1,400-crore (Rs 14 billion) factory near Bangalore.
"The factory will be ready by mid-2010 and we are yet to finalise the launch date of the new car. We have basic concept of the new car ready and very shortly we will finalise the design of the car," Akira Okabe, senior managing director, TMC, told reporters.
The compact car is being developed by Toyota engineers with inputs from their Indian counterparts, top officials of the Japanese car-maker said. Though the new compact car is designed for the Indian market, the initial features indicate that it can be exported to other markets in Asia, Okabe said.
"Toyota aims to capture 10 per cent of the Indian passenger car market by 2010. The new plant will help us achieve this target between 2010 and 2015," Okabe said. Currently, Toyota has 3 per cent market share in the 1.5-million-unit car market in India, according to data from Society for Indian Automobile Manufacturers during last fiscal.
The foundation stone was laid at Bidadi, about 40 km from here, by Karnataka chief minister, B S Yeddyurappa, in the presence of top company officials, including its Indian subsidiary Toyota Kirloskar Motor's Ryoichi Sasaki (chairman), Vikram Kirloskar (vice- chairman) and Hiroshi Nakagawa (managing director).
Toyota's first plant in India was built in 1998 on the Bangalore-Mysore expressway with a capacity to produce 60,000 units per annum.
Okabe said the second plant will see an initial investment of Rs 1,400 crore. However, the investment does not include certain other costs like installing robots, jiggs, a special type of tool among others.
"The additional amount of investment required for the plant will be worked out later," he said.
The second plant will be spread over 130 acres and includes a new test track. The plant will have an installed capacity of 100,000 units annually and will employ 2,400 people. Toyota's first plant manufactures Innova, a multi utility vehicle and Toyota Corolla, a luxury sedan. Its premium luxury car, Toyota Camry, and sports utility vehcile, Prado, are imported as completely built units.
Okabe said Toyota will not involve its group company, Daihatsu, in designing the new compact car for the Indian markets. However, the company may involve them in the future projects, he added.
Toyota has till now invested Rs 2,000 crore (Rs 20 billion) in the Indian subsidiary, Toyota Kirloskar Motor along with the Pune-based Kirloskar group as its partner, which holds 11 per cent.
TKM, reported a turnover of Rs 3,600 crore (Rs 36 billion) during 2007-08, registering a growth of 24 per cent over the previous year.