Toyota small car may sport Rs 5-7 lakh tag

Toyota Kirloskar Motor, the Indian subsidiary of the Japanese auto giant, has revealed the pricing segment for the compact car it plans to launch in 2010.

Toyota Kirloskar Motor which is the Indian venture of Toyota Motor, the world’s biggest car manufacturer by volumes, also plans to jack up its production to 5,000 units a month by July, and double sales and servicing manpower by 2010.

“The compact car will be priced in the B+ category,” said Sandeep Singh, deputy MD, revealing details of the much-awaited car for the first time. This category has cars, such as Maruti Swift, the Skoda Fabia and the Chevy UVA.

The pricing of these cars is between Rs. 5 lakh and Rs. 7 lakh. This means that the compact car will be priced between a Santro top-end variant and a Honda City entry variant. The model will be launched in both sedan and hatchback versions. Around 70,000 units of the so-called compact vehicle will be produced at its Rs 3,200-crore factory at Bidadi in Bangalore.

The compact car will have a localisation of 65% to start with, and will gradually be taken to 90% by 2011, said Shekar Viswanathan, deputy MD (Commercial). That would make it one of the few foreign models with the highest percentage of local components.

Higher localisation for the small car has made the company actively consider a new powertrain facility by the end of 2010. Still in the planning stages, the facility will be dedicated to producing engines and gearboxes for the compact car.

The company is looking at expanding dealer network from the current 82 to 150 by 2010-end, said Mr Singh. “With the compact car, we want to be in semi-rural and rural towns,” he said.

By the end of this year, the number of dealerships will be around 95. With the rise in dealerships will come new hires, which will double the sales and servicing teams from the existing 2,800 people.

“That is another reason to go for higher localisation,” said Mr Viswanathan, adding that a review is currently underway for further cost cutting. “But, that will not affect the existing plans for the small car,” he clarified.

Source: Economic Times