Bangalore, June 24 (Inditop) Japanese auto major Toyota Motor Corporation (TMC) will invest an additional Rs.8 billion ($165 million) in its Indian joint venture with the Kirloskar group to expand capacity of its Bangalore plant and roll out a small car for the domestic market, Karnataka Industry Minister Murugesh R. Nirani said Wednesday.
“Toyota has agreed to invest an additional Rs.8 billion (Rs.800 crore) in the second phase of expansion. This will be over and above Rs.32 billion (Rs.3,200 crore) it has committed to invest in the project, which includes a second plant to manufacture small car for the Indian market,” Nirani told reporters on the margins of a trade event.
A Toyota-Kirloskar Motor Ltd (TKML) official confirmed the additional investment but declined to elaborate, as the joint venture was awaiting government approval and allocation of additional land at Bidadi, about 30 km from this tech hub, for its expansion plans.
Besides manufacturing multi-utility vehicle Innova and mid-segment luxury car Corolla, Toyota assembles its sedan in the first plant, which has a combined installed capacity of 100,000 units per annum.
In the first phase, the decade-old TKML made a cumulative investment of Rs.17 billion (Rs.1,700 crore). In the second phase, it has invested Rs.12 billion (Rs.1,200 crore) to set up the second plant for the small car project, with a production capacity of 65,000 units per annum.
“Subsequently, Toyota has increased the investment to Rs.32 billion for ramping up the installed capacity for existing models, transmission units (gear boxes) for its global plants and component manufacturing by ancillary units,” Nirani said.
Though the Indian subsidiary has 432 acres of land for its plants and ancillary units, it has sought an additional 40 acres of land for locating more vendors and suppliers.
TKML had set up the first plant in 1999 on the Bangalore-Mysore expressway to roll out a multi-utility vehicle Qualis during the first five years of operations. It phased out Qualis and introduced Innova in 2005. It also began assembling Prado, a sports utility vehicle.
The installed production capacity was expanded to 63,000 units per annum in 2006. It currently employs about 2,800 people.
TMC holds 89 percent of the equity in TKML, with the balance 11 percent by the Pune-based Kirloskar group.
