Toyota Kirloskar Motors is expecting demand for BS4 diesel cars to increase, especially where buyers are fleet operators or shared mobility partners. This is in view of the BS6 emission norms, which are coming into effect from 1st April 2020. BS6 diesel Toyota cars will be about 15-20% more expensive than its BS4 counterpart.
Considering this price hike, buyers could prefer BS4 cars as against BS6 cars. With the company planning to launch BS6 engines by end of this year, Toyota is expecting demand to soar for BS4 vehicles ahead of that. This boost in sales of diesel vehicles would also help the company arrest sales decline, through which not only Toyota but every other automaker in the country is going through.
In an example of the price increase once BS VI standards come into effect, there could be an increase of around Rs.4 to 5 lakhs in diesel Fortuner SUV, which is currently priced at Rs.30 lakhs. Price of Innova Crysta diesel could increase in the region of Rs 3-4 lakh. When comparing petrol and diesel vehicles, it is the latter that involves more technologies to control particulate matter so as to comply with BS6 emission standard which would result in this higher price.
Fleet and shared mobility operators are sensitive to a price increase. Hence the company targets this segment into buying BS 4 compliant vehicles as against the higher priced BS VI vehicles which would also benefit the company to balance off sales figures.
Toyota India Deputy Managing Director N Raja told PTI – “We are trying to educate our customers, particularly in fleet and employee transport, shared mobility, tell them the cost increase that is going to come and try to provide them solutions accordingly, either BS-IV or BS-VI, to suit their needs. They (fleet operators) would be better off buying BS IV than going for BS VI.”
Toyota Kirloskar Motors has seen a decline in sales by 10-12 percent in the current period while in 2018-19, domestic sales increased 7 percent to 1,50,525 units as against 1,40,645 units sold in the 2017-18 period. The company gears up to be BS VI ready well ahead of the deadline and will be able to supply such vehicles by January/February 2020.
Passenger vehicle production had dipped 13.18 percent in the April-July 2019 fiscal causing most top automakers to reduce output. Toyota Kirloskar Motor reduced production during the period by 20.98 percent to 45,491 units.