BANGALORE, February 12: Toyota Kirloskar Motor hopes to break even by the third year of its launch of cars in India. The company is expected to unveil its multi-purpose family vehicle with a passenger capacity of 8-10 people in the first quarter of 2000 with production slated to begin at the end of 1999.Addressing a press conference in Bangalore on Thursday Hiroshi Okuda, president, Toyota Motor Corporation, said that the company has conducted a detailed feasibility study last year and found that multi-purpose vehicles are the best bet for Indian conditions. Price and environmental factors have forced the company to go in for a multi-purpose vehicle, he admitted.
He said Toyota Kirloskar Motor will cover all accumulated deficiency on the financial front within the first five years of operation in the country.
The company is also planning to export components and finished goods from its joint venture, though negotiations are at an embryonic stage.
The group is also planning to enter into separatejoint ventures for manufacturing auto components in Bangalore. However, he refused to divulge further details about the proposed projects. Initially, the import of components will be around 50 per cent, and it is expected to decline by 30 per cent eventually.
About the pricing of the cars, Okuda said Toyota has not yet taken a decision on pricing. However, the price will be competitive with other manufacturers in the country, he pointed out.
According to Okuda, the company, after reaching the production level of 50,000 cars a year, will enhance its investments in the manufacturing facility coming up in Bidadi near Bangalore. At present the company has plans to invest Rs 650 crore in the venture. Toyota Kirloskar will be using some second-hand machinery in its facility. However, he refused to comment about the portion of second-hand machinery being used for the manufacturing facility.
Speaking on the occasion, Toyota Kirloskar Motor managing director S Yamazaki said, "Toyota's market entry is not basedsolely on the potential inherent in the vast size of the Indian market. We also intend to develop this plant and our operations to become a major part of Toyota's global strategy."
During the first phase, the project will employ about 1,000 people with a further downstream employment potential with vendors and dealers, said the company's vice-chairman Vikram S Kirloskar.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
