New Delhi: Japanese auto major Toyota Motor Corp will invest $350 million (Rs1,400 crore) for setting up a second plant in India as part of its plans to introduce a ‘strategic’ small car in the country by 2010.
Ending months of speculation over the second plant, Toyota, which runs the Indian operations through a joint venture with the Kirloskar group, has decided to set up the new plant at its existing location in Karnataka.
“We have decided to build the second in Bangalore at the site of the existing facility with an investment of USD 350 million,” Toyota Kirloskar Motor (TKM) deputy managing director K K Swamy told PTI.
The new plant will have a production capacity of 1,00,000 units and will become operational by 2010, he added. The company’s current plant has a capacity of 63,000 units a year.
TKM has been scouting for a location for months and finally zeroed in on the existing location to drive synergies with the existing operations.
“From this plant, we will roll out a strategic new small car which is currently under development at our Japan R&D facility. The small will meet the broad needs of the Indian customers,” Swamy said.
The new small car, which will have high localization level, is primarily aimed at the Indian market although some of it will be exported, he added.
Toyota had in the past declared that it would capture 10% of the Indian car market by 2010 and the new car is expected to play a key role in it.
Asked about the pricing and positioning of the small car, he said it would not be at the ‘Nano’ range nor it would be too expensive.