TOYOTA
KIRLOSKAR
MOTOR PVT LTD
Background
Established in 1997 as a joint venture
between the Kirloskar Group and the Toyota
Motor Corporation (TMC), Toyota Kirloskar
Motor Private Limited (TKM) has grown
rapidly to emerge as a significant player in
India’s passenger car and MUV market
segments.
The company has a long-term goal in India
and aims to play a major role in the
development of the automotive industry and
the creation of employment opportunities, not
only through its dealer network, but also
through ancillary industries. Toyota had a
turnover of USS 587.5 million last year, and
the company has started making profits from
last year. Toyota has brought in US$ 152
million in equity, and has invested another
US$ 40 million from internal accruals. Toyota
employs 2,300 people in India.
TKM, along with its dedicated dealers and
suppliers, has adopted the “Growing Together”
philosophy of its parent company, TMC, to
create long-term business growth. In this way,
TKM aims to further contribute to progress
in the Indian automotive industry, realise
greater employment opportunities for local
citizens, improve the quality of life of its team
members and promote robust economic
activity in India.
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Well-established in the MUV
and passenger car segments
Toyota first entered the Indian automotive market in
the MUV segment with the launch of the Qualis model
in 2000. The model was instantly popular and quickly
grew within a short span of 2 years to capture 20 per
cent market share from established players like M&M
and Tata Motors.
Quick on the heels of Qualis’ success, TKM launched
two passenger car models – Camry in 2002, in the
high-end luxury segment and Corolla in 2003, in the
luxury segment. Both cars have again proved popular
and registered impressive growths – Corolla sold 9,546
units in 2003-04, capturing 40 per cent of the segment
share, while Camry has also grown at 140 per cent
to 1,117 units during the last year.
Factors for success
Toyota’s success in India has been due to several
factors – a renowned brand, world-class manufacturing
processes and practices, in-depth market analysis,
superior product quality and committed employees.
Leveraging brand strength
Even before its entry into India, the Toyota brand
was well known in India and had a strong aspiration
value. Toyota also reinforced its technical strength
and customer care through innovative ad campaigns.
the 1990s, Toyota decided to enter India through
the MUV segment. This was based on an extensive
market study and analysis that indicated the potential
for a world class MUV that would offer the driving
experience of a car, at an affordable price. The MUV
segment at that time had two major players – Tata
Motors and M&M, whose products, while rugged
and reliable, were not seen as substitutes for a car.
Thus, while other MNCs were competing for share
in an increasingly crowded passenger car market,
Toyota was established itself in the MUV segment.
World class manufacturing processes
and practices
The Toyota Production System (TPS), originally a
means of achieving mass-production efficiency with a
small production volume of a few thousand vehicles
per year, has become a sought after best practice for
achieving highly efficient ‘lean manufacturing’ for
manufacturing industries worldwide. Just-in-time (JIT)
production and in-process quality assurance are
hallmarks of the TPS, which is applied throughout the
company’s global production structure.
Also, Toyota’s world class research and development
has made possible technological advancements in
quality manufacturing, safety, efficiency and
environment preservation, all of which contribute to
enhancing customer satisfaction.
Committed employees
In-depth market analysis
Despite strong growth in the passenger car market in
SUCCESS STORIES
True to its belief that the employees are the main
source of strength for an organisation, Toyota seeks
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to create a corporate culture where values such as
“Continuous Improvement” and “Respect for People”
are fully reflected in all actual corporate and individual
activities. The company takes maximum care to ensure
stability of employment and strives to improve working
conditions.
TKM’s young team members are regularly sent to
Japan, Indonesia and Taiwan for training. More than
400 team members have benefited from such
programmes at various Toyota plants worldwide. The
company also has an ongoing suggestions scheme that
seeks to increase and reward employees’ commitment
and involvement.
Developing India as a global source
for auto parts
Toyota has set up Toyota Kirloskar Auto Parts Limited,
to produce transmission components (gear boxes)
for its global operations.
Apart from this, it also made fresh investments last
year into its JV Kirloskar Toyota Textile Machinery
Limited (KTTM), to build capability for producing auto
components there. Toyota officials say, “The venture
has been making textile machinery in India. But with
Leveraging the India Advantage
Availability of technical manpower
Availability of technical manpower is critical to Toyota’s
strategy of manufacturing locally as opposed to imports.
One of the key strengths Toyota sees in India is the
availability of technical manpower from premier
engineering, diploma and ITI institutions. In addition
this, manpower comes at an attractive wage providing
good return on investment.
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the global automotive business expanding, we now
intend to utilise this venture for also making low cost
components in India to complement our transmission
venture here”. Both plants are 100 per cent export
oriented units, and reinforce Toyota’s commitment
to developing India as a sourcing hub for auto
components.
Future plans
Toyota plans to increase its market share in the MUV
and car markets, alongside increasing productivity.
Toyota expects to grow 10 per cent per year in the
future. Toyota will also plan to continue working
with component manufacturers to help/guide them
on quality, cost and delivery. Toyota plans to invest
US$ 28.3 million to increase production capacity from
45,000 to 60,000.
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