TKM is likely to launch the higher volume Etios hatchback ahead of the sedan. Toyota is also building a new plant in Brazil for this emerging markets entry-level line

TKM is likely to launch the higher volume Etios hatchback ahead of the sedan. Toyota is also building a new plant in Brazil for this 'emerging markets' entry-level line

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Toyota Kirloskar Motor (TKM) is on schedule to open its second production facility in India on schedule in December 2010, executives on Wednesday (21 July 2010) confirmed to just-auto at the media launch of the diesel Corolla Altis sedan in New Delhi.

The company is spending INR3,200 crore (INR32bn or US$677m) on its second plant on the outskirts of Bangalore to make the Etios small car with an initial production capacity of 70,000 units.

TKM is an 89/11 joint venture between Toyota Motor Corpooration and the Kirloskar Group. Its existing assembly plant has capacity for 80,000 units annually and makes the Corolla Altis, Innova and Fortuner. TKM also imports the Camry, Prado, Land Cruiser and Prius fully assembled. 

There had been local rumours that Toyota might scale back investment in the second Indian plant due to difficult market conditions globally but TKM's Japanese chief dismissed those.

Managing director Hiroshi Nakagawa said: “Construction costs as well as raw material prices have increased in the past few years due to the hike in petroleum prices, we remain committed to our investment in the Indian plant. We tried to control the cost by implementing ‘Kaizan’ and we have been successful to a great extent. The second plant will commence production on schedule in December 2010.”

The plant opening will coincide with the global launch of the Etios which will be sold in both hatchback and sedan forms in India. But TKM was coy on which will arrive first. Deputy managing director Sandeep Singh said: “We [are unable] to disclose the version to be launched first in the Indian market though we are ready to launch both.”

That said, it's likely to be the hatchback version as this will be the higher volume model. TKM also declined to comment on pricing but has indicated the model would be pitched against Maruti's Suzuki Swift hatchback and Desire sedan variant as well as Tata Motors' Manza.

Singh said recent Toyota recalls in other markets had not affected sales in India.

“There has been no impact. On the contrary, we sold 55,497 units in 2009 and are likely to achieve about 70,000 units in 2010. With the second plant coming on line, we are likely to reach 150,000 units in 2011.”

He added: “In the last six months we have grown by 69% compared with 31% overall in the Indian market segments in which we compete.”

TKM has launched diesel (and CNG) versions of the Corolla Altis to tap into the growing diesel car segment which is expected to account for almost 55% of car sales here this year.

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