Team-BHP - Toyota signs MoU with Maharashtra govt. to set up a new factory

Toyota Kirloskar Motors (TKM) has signed a memorandum of understanding (MoU) with the Maharashtra government to set up an automobile manufacturing plant in Chhatrapati Sambhajinagar.

Toyota signs MoU with Maharashtra govt. to set up a new factory-2022toyotaurbancruiserhyryder02.jpg

According to Toyota, it will invest Rs 25,000 crore into the new facility, which is expected to generate employment for 8,000 people and an additional 16,000 people will get employment in ancillary units.

The new factory is expected to begin operations in 3 years. It will manufacture both ICE and electric vehicles and have an annual production capacity of around 4 lakh units.

This will be Toyota’s third manufacturing unit in India. The carmaker currently has two units in Bidadi, Karnataka, which is also being expanded. In 2023, Toyota announced an investment of Rs 3,300 crore to expand the production capacity of the Bidadi plant by 1 lakh units annually. It is expected to become operational in 2026.

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Originally Posted by TorquePull (Post 5813904)

If I'm not wrong, they only make 3 cars at the moment and no new cars are expected in the near future. Unless they start manufacturing Maruti cars, I wonder what they plan to manufacture here. 25,000 crores is a significant investment.

They do manufacture a Maruti Suzuki product, namely; the Grand Vitara in their Bidadi plant.

Innova HyCross, Innova Crysta and Fortuner are manufactured on one assembly line

Hilux and Camry are assembled in the 2nd plant, with CKD/SKD kits received from Thailand. Meanwhile the Urban Cruiser HyRyder and Grand Vitara are manufactured in the same plant in which the Hilux and Camry are assembled.

As per my unerstanding and knowledge, the plant utilisation at their Bidadi plant in Bangalore was at a dismal 25% before the "HY-" and the Maruti models manufactured there. There has been an increase in utilisation by 30% once Hycross and Hyryder were introduced along with the other Maruti models assembled at Bangalore. With their current plant utilisation at 55% there is capacity to produce another 1,53,900 units annually that translates to another 12,825 units per month.

Toyota has not yet announced any future plans to add any further models from its stable. Really do not understand the logic behind the new plant at Maharashtra. Also, Toyota will never be aggressive on Electric Vehicles.

Who would think of another plant without the current manufacturing volume being completely utilised? However, Toyota would not commit on another plant without a definite plan into the future unlike the Americans; one of which is struggling to re-enter the Indian Market.

Toyota also shut down two of its Sao Paulo plants in Brazil which manufactured Corolla, Corolla Saloon, Hilux and LCs. Not sure about their engine and transmission plant in Poland which also has been reported to be shut down.

Wondering whether India will be the manufacturing hub for the Corolla Family along with Hilux and LCs. There could also be a possiblity that the new plant could be used exclusively for the export models just like one of their plants in Thailand.

What could be the possibilty for Diahatsu entering India? Toyota was actively considering the RAIZE compact SUV to be launched in India.

Needless to say I could only see a golden opportunity for Suzuki in the future if Toyota is not able to capatilise on their existing and future capacity expansion.

The new plant will mostly cater to exports.

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“Toyota Motor Corporation believes that India is well positioned to become a global manufacturing hub for cleaner and greener mobility solutions," the company quoted Masakazu Yoshimura, MD and CEO of Toyota Kirloskar Motor and Regional CEO at Toyota Motor Corporation (TMC), as saying. "This belief was reinforced with the recent regional restructuring which elevated India to play central role by being integrated into the Middle East, East Asia & Oceania Region and acting as the hub of the new “India, Middle East, East Asia & Oceania Region”. Today’s MOU signing marks a pivotal point as we stride into the next phase of growth in the country enabling us to contribute to enriching lives with qualitative mobility solutions locally and globally.”

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The strategic location is likely to enhance TKM's ability to meet business and logistical requirements more efficiently, allowing the company to serve wider markets within the country and abroad thereby offering significant advantage and growth opportunities, it added.

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Originally Posted by Adorablejim (Post 5814101)

Toyota also shut down two of its Sao Paulo plants in Brazil which manufactured Corolla, Corolla Saloon, Hilux and LCs. Not sure about their engine and transmission plant in Poland which also has been reported to be shut down.
What could be the possibilty for Diahatsu entering India? Toyota was actively considering the RAIZE compact SUV to be launched in India.

It will be great if Toyota will start at least a CKD assembly line for Land Cruiser 300 & Prado in the new plant. Financial viability could be the reason for not doing it unless they wanted to export it to all RHD markets other than Japan.

I think Toyota should have sold the Maruthi vehicles under the Diahatsu brand. To link it with Toyota they should have advertised it as ‘from a Toyota Family’ or something. For people with bare minimum automobile knowledge will see rebranding as ‘diluting/spoiling’ the brand name Toyota.

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Originally Posted by dsuman (Post 5814366)

This is good news. Toyota looking to pump in 25000 Cr for a new plant (as speculated for exports) shows they have confidence in the capabilities of India. I am sure they wont invest heavily if they are not 100% sure of the new Plant's utilization or the Use case. Feels good to hear (from the world) that India has the capability to become a manufacturing hub.

Honda had invested a total of Rs.18,500 crore for a period of 10 years since it started operations in 1998 till 2008 which in terms of value will be more than what Toyota plans to invest now. These investments does not include any product development that include the Amaze and Elevate. We all know the state of affairs at Honda in India now.

Total investment by Ford in India was 12,000 crores plus a Global Technology and Business Centre in Chennai worth an investment of 1,640 crores. Ford does not exist in India anymore and trying hard to re-enter the Indian Market.

There is absolutely no doubt that India has the capability to be a manufacturing hub which is proved beyond doubt as Suzuki reaffirms the growing role of Maruti in its Global Roadmap. Needless to say Suzuki India accounts for 33% of its Global Sales.

Force Motors has been manufacturing and supplying 4 cylinder and 6 cylinder engines and axles to Mercedes Benz since 1997 and engines for BMW since 2015.

World has already endorsed India to be a manufacturing hub long time ago.

Let us wait and watch what exactly is the strategy of Toyota as there are other manufacturers who had made significant investments in the past and are either non-existent in India or is struggling to capture the Indian Market. Toyota is already in that club of not so successful manufacturers in India.

I personally accepted this good news with regard to the investment of 25,000 crores with a pinch of salt and I am not excited.

Toyota's Maharashtra plant to build flex fuel vehicles.

Transport Minister says that many Indian companies are setting up plants to produce 100% ethanol-run cars and two-wheelers in India.

Gadkari came to Parliament in a similar vehicle produced by Toyota.

Recently, Toyota has announced for setting up of a plant to produce flex cars in Aurangabad, Maharashtra, with an investment of INR 20,000 crore.

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