HomeCar NewsToyota cancels plans to launch Daihatsu in India - Here's why

Toyota cancels plans to launch Daihatsu in India – Here’s why

Toyota’s recent announcement of an alliance with Suzuki has resulted in cancel of Daihatsu India launch plans. Keen to penetrate the India small car market, Toyota had earlier decided to launch their low-cost brand, Daihatsu in India.

But, after their alliance with Suzuki was announced, it makes less sense to continue with plans to launch Daihatsu in India. The reason being, Daihatsu cars will largely compete with Maruti Suzuki cars in India.

Toyota and Suzuki partnership is a mutually beneficial one. Suzuki will gain access to Toyota’s R&D while Toyota will get to use Suzuki’s brilliant network and resources in the Indian auto industry, which is set to become the top 3 auto market in a few years time.

They synergy of the two Japanese giants will see new green cars and autonomous driving technology being brought to India. The company is studying the Indian small car market with added interest, while Daihatsu will concentrate more on Indonesian and Malaysian markets for the time being.

Chairman of Toyota Kirloskar Motor, Hiroyuki Fukui, who is also the CEO of Asia, Middle East and North Africa region stated that while India is one of the biggest markets, the company commands a 4-5% market share which is significantly lower than its 30-40% share in South East Asian markets. The immediate focus is to increase market share in India.

Toyota has much to learn from Suzuki in terms of small cars. The company seeks to bring in new cars into India to enhance market share and Toyota is also likely to set up a dedicated R&D center in India with special emphasis on small cars. The design studio from where the Etios facelift was designed is being upgraded to take on larger projects and expansion of networks is also on the cards.

Toyota is also planning launch of a new India-spec sedan in India sometime in the coming year. This new car, which is codenamed 23IB as on date, will be based on the Etios Core platform. It is heading to the Delhi Auto Expo in February 2018 and will compete with the Honda City, Maruti Ciaz and Hyundai Verna once launched. Toyota is also planning launch of the 230B Yaris hatchback in 2020.

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