The partnership between the two Japanese giants, Suzuki and Toyota to share platforms and build cars in the segments respective carmakers are not present is a good strategy and will help both Suzuki’s Indian arm – Maruti Suzuki and Toyota Kirloskar to save a lot of costs. Maruti Suzuki is already leading in India with over 50% market share and as it looks to venture into new segments, the company now plans to invest about $1 billion at Toyota’s plant in Bidadi near Bengaluru says a report on Deccan Herald.
Earlier in February 2018, Toyota and Suzuki had signed a memorandum of understanding (MoU) under which Toyota Kirloskar Motor will manufacture vehicles developed by Suzuki for the Indian market and will be sold through both the company’s dealer network under its respective brand name.
As per the report, Takayuki Kitagawa, Consul-General of Japan further confirmed that Toyota’s plant near Bengaluru currently has an annual capacity to make 3 lakh cars but only half of it is being utilised. “There is an ideal capacity of 1.5 lakh at the plant and Maruti will make further investment to manufacture their cars at the Toyota’s facility.”
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Maruti Suzuki currently has plants in Manesar, Gurgaon in Haryana and in Mehsana district of Gujarat. This additional capacity coming from South India is certainly a win-win situation for both the Japanese automakers here in India. The work on this has already started and officials from Maruti Suzuki and Toyota Kirloskar Motors are in the final stages of discussions on investment, Maruti Suzuki officials visited the Toyota’s Bidadi plant to access the manufacturing capability. Suzuki plans to make 2.5 million cars in India by 2030 maintaining its strong dominance in India.
Maruti Suzuki is expected to work out of Toyota’s Bidadi plant starting 2022 with an investment of $1 billion. The plant has already seen an investment of about $3 billion over last 20 years by Toyota. The additional investment will help Maruti Suzuki to refurbish the whole plant as per its own requirements. With Maruti Suzuki going south, also expect the whole supplier ecosystem to get a big boost giving the state more investments.
Under this partnership, we will see the two companies working on cross-badging its vehicles and while Maruti Suzuki will get access to Toyota’s Corolla sedan, Toyota will get its hands on the Maruti Suzuki’s Baleno and Vitara Brezzza platform.
