Toyota is considering introducing its Daihatsu small car brand to India as part of an expansion drive that will include an all-new Toyota-branded mini car by late 2010.

“We are internally talking to bring Daihatsu in India,” Toyota Motor Corporation (TMC) senior MD Akira Okabe told The Times of India during the local launch of the Fortuner SUV.

He added: “A lot would depend on our performance here.” Osaka-based Daihatsu, owned by Toyota, is Japan’s largest minicar maker and sells cars in over 100 countries, both in conjunction with local Toyota national sales companies and through stand-alone importers such as here in Britain. Okabe noted the brand was doing particularly well in Asian markets such as Indonesia and Malaysia (where it has a local joint venture).

A separate local report said Daihatsu had previously eyed the Indian market and held talks with local businessmen but these came to nothing.

Unable to take a firm decision, Toyota decided to opt for a new small car under its own badge, The Times of India said, noting that Daihatsu’s entry would make Toyota’s small car portfolio formidable, giving the company a multi-product strategy like that of other local carmakers including Maruti Suzuki and Hyundai. Toyota, despite its global dominance, has been a late starter in India and has a meagre 3% market share.

Toyota operates through a joint venture with the Kirloskar group and is investing INR32bn in a new plant at Karnataka, which would mainly be used for its upcoming small car.

Asked whether the company plans to get in its luxury brand Lexus to India, Okabe said it was not being considered at the moment, pointing out that its current focus would be on mass-scale products.

High import duties were a deterrent to launching the globally-successful Prius hybrid.

“We are in discussion with the government and waiting for a positive response,” a local Toyota official told the paper.

Hiroshi Nakagawa, MD of the Indian JV Toyota Kirloskar Motors, said Toyota expected to grow its market share to double digits by 2015, mainly due to its small car.