Diesel ban effect: Toyota could put off new car investments

Earlier this week, we had reported that the National Green Tribunal has extended the ban on diesel cars with engines larger than 2,000cc to six cities in Kerala. As a result, Toyota is reported to be rethinking its strategy for India. The company might not make further investments necessary for the launch of new models. However, it has also revealed that it is not looking to wind up operations in India.

Toyota has been unable to sell its best-selling vehicles such as the Innova and Fortuner in the National Capital Region since the ban was imposed in December 2015. With the ban being extended to Kerala, the company will not be able to sell its cars in the southern state either. Toyota feels that its vehicles are being targeted.

Toyota launched the Innova Crysta in India earlier this month. While it has got a good reception all over the country, customers in Delhi and Kerala, which the company claims are big markets, will not be able to buy the MPV.

Other companies such as Mahindra, Mercedes-Benz and Tata Motors have also been affected. While Mahindra responded by introducing a smaller diesel engine in the Scorpio and XUV500 to beat the ban, the other manufacturers have not been able to do the same. Mercedes-Benz has stated that it has put its investment plans in India on hold.

Source: Financial Express