The Toyota-PSA Czech car making joint venture TPCA has postponed a plan to boost production capacity to 340,000 cars this year due to the global downturn but its output should nonetheless grow slightly on higher demand for smaller cars.

President Yasuhiro Takahashi said the carmaker wanted to stay cautious as it was not clear how long an incentive scheme to replace older cars in Germany would keep boosting demand for small cars.

“The main reason (to delay the expansion) was that sales fell a bit in the autumn,” Takahashi told Reuters after presenting last year’s results.

“Now we are analysing what to do … Small cars are selling well in Germany but this could end very soon as the scrappage amount is limited. We are ready to go forward when conditions are right,” he said.

The third biggest Czech exporter, which revealed its expansion plan in October, increased production of its budget Toyota Aygo, Peugeot 107 and Citroen C1 models by 5% to 324,289 last year.

TPCA, which started production in 2005, plans to assemble 330,000 cars this year, reaching its maximum capacity, Takahashi said.

“We can very realistically expect that the (car) market (in Europe) will not rebound this year and the very difficult period will continue,” Takahashi said.

TPCA said it scrapped a plan to hire additional workers at the turn of the year due to the market weakness and plans to keep employment at around the current 3,582 this year.

The carmaker’s revenue fell by 4% to 49bn crowns (US$2.42bn) last year, dented mainly by a strong Czech currency.