Toyota defers Liva launch till June to clear Etios backlog

The world's largest carmaker Toyota have postponed by two months introducing the hatchback version of its sedan Etios in India to June as it tries to clear order backlog of the recently launched car.

The company, which is present in India through a joint venture with the Kirloskar Group, will be doubling its output at the Bangalore facility to a minimum of 5,000 units every month from April for the Etios sedan.

"We have received very good response for the Etios. We are doubling the production of the car by starting the second shift from April," Toyota Kirloskar Motor (TKM) Deputy Managing Director (Marketing) Sandeep Singh told PTI.

Etios' waiting period is 4-6 months and TKM has decided to fulfill its commitment to existing customers first.

"Hence, to clear the order backlog, we have decided to postpone the launch of Liva by about two months," Singh said.

The company had launched the Etios in December last year and had announced its plans to introduce the small car Liva with a 1.2 litre petrol engine in April 2011.

As part of the new plan, the company will now enhance Etios output to a minimum of 5,000 units from the existing about 2,500 units per month, Singh said.

TKM has so far received about 26,500 booking orders for the Etios since its launch and the company has delivered only about 5,000 units, he added.

The company has invested Rs 3,200 crore to set up its second manufacturing facility in the country with an installed capacity of 70,000 units per annum to roll out the Etios. It has launched the car with a 1.5 litre petrol engine.

The Japanese auto major had launched Etios with a price tag of Rs 4.96 lakh-Rs 6.86 lakh (ex-showroom, Delhi). It has been pitched against other entry-level sedans such as Maruti DZiRE, Mahindra Logan and Fiat Linea.

At the time of the launch, Singh had said the company was targeting to sell 70,000 units of Etios, including the hatchback, in 2011.

When asked about its sports utility vehicle Fortuner, Singh said: "We had started the booking again in January and so far received about 4,000 orders. The waiting period for the vehicle is 3-4 months now."

The company's first facility at the same location has a production capacity of about 80,000 units per annum.

On the impact of rising commodity prices, he said: "We are under pressure. We will review the prices of our products by March-end."

TKM currently manufactures models like multi utility vehicle Innova, premium sedan Corolla Altis and SUV Fortuner in India. It also sells sedan Camry, SUVs Prado and Land Cruiser and hybrid car Prius in the country as fully imported vehicles.

LONG WAITING LIST- In queue for Etios? Toyota may offer you Liva

Faced with a deluge of bookings for its new sedan Etios, Toyota is considering a unique offering for those in queue by giving them the option to shift to the company’s compact car, Liva, which debuts in March. Alternatively, the company is also considering to marginally increase the production of Etios to accommodate the rush.

According to sources, Toyota is worried that the seven to eight months’ waiting period for Etios may prompt customers to shift to rival brands. So, it is working on a plan to offer those with Etios bookings the option to go for the compact Liva, though details are still being worked out. It is not yet clear whether these people will get a priority in the delivery of the 1200cc petrol-engine Liva, which is likely to be priced around Rs 4 lakh.

The company hopes this move will ensure that the customers will stay within the Toyota fold, while getting an option to cut down on their waiting periods. The Etios, deliveries for which started earlier this month, has been a runaway success for the company and it has so far received bookings over 18,500 units.

When contacted, Toyota Kirloskar deputy MD (sales & marketing) Sandeep Singh said, “We are looking at various options, and a concrete plan is yet to be firmed up.” Singh, however, agreed that the company was looking at increasing the production of Etios from the plant near Bangalore, which has come up with an investment of Rs 3200 crore. Toyota plans to manufacture about 70,000 units from this plant between the Etios sedan and its compact version Liva in the first year. “Our manufacturing team is looking at this and a decision on enhancing production will be taken towards the end of February. However, if it happens, the increment in production may not be a major one. Whatever happens will be through improved efficiency and tweaking things here and there,” Singh said.

The company is gradually ramping up numbers at its plant and will start secondshift operations there. At full steam, the plant can churn out 200,000 units annually, though reaching this capacity will take time.

The Etios and the Liva are the two most ambitious products from Toyota’s stable to boost its share in the fastgrowing Indian car market. The company currently has a low single-digit share and has said it wants a 10% share to “occupy a mindshare of the average car buyer”. It has set a target to sell about 300,000-350,000 units by 2015.

The Etios Sedan is launched in Hyderabad

Toyota Kirloskar Motor (TKM) will increase the localisation of Etios, the B segment sedan which it launched in Hyderabad on Wednesday, once its engine plant in Bangalore gets ready in 2012. As of now, the vehicle is 70 per cent localised and this will go up to 90 per cent in two years.

Also, it will increase its dealer network from seven to ten in Andhra Pradesh in view of the new launch.

Speaking to the media on the launch, TKM executive managing coordinator (sales) Koji Nagata said the sedan would be available in four variants priced between Rs 4.95 lakh and Rs 6.88 lakh ex-showroom Hyderabad.

The company would soon launch a diesel variant of the sedan, he said, adding that there have been 8,000 bookings of the new vehicle which was launched nationally last week. It would take about four or five months to deliver them.

The company also unveiled its hatchback, Etios Liva, which would be launched in April 2011. "This is the small car for us. There are no immediate plans for smaller car than Liva,'' he said.

TKM general manager (sales) Sailesh Shetty said the company was now working out the price hike on its models as the input costs, particularly of steel, have gone up. Inflation and strengthening of the rupee too are factors, he said.

Etios will be made at the second TKM plant in Bangalore, which has an annual production capacity of 70,000 vehicles.

Music maestro AR Rahman has been roped as the brand ambassador for Etios.

Toyota to launch hatchback 'Etios Liva'

Japanese auto major Toyota will launch compact car 'Etios Liva' by April 2011 to strengthen position in India, where it is a fringe player in the car segment as against its leadership position globally. The company, which is present in India through a joint venture with the Kirloskar Group, said the pricing of the hatchback based on the same platform as its new Etios sedan will be decided after the Union Budget.

It has priced the entry level sedan Etios between Rs 4.96 lakh and Rs 6.86 lakh (ex-showroom Delhi). "The launch of Etios sedan will be followed by the hatchback model called Etios Liva. By the end of March next year or April beginning we will launch the car and deliveries will start from April," TKM Deputy Managing Director Marketing Sandeep Singh told reporters here. On the pricing of Etios Liva, he said, "We will take a call after the Budget."

While the Etios sedan is powered by a 1.5 litre petrol engine, the Liva will have 1.2 litre petrol engine. Singh said both the sedan and hatchback put together, TKM plans to sell 70,000 cars in India in 2011. Recently, he said the company aims to sell 1.45 lakh units of all its models next year, from about 73,000 units expected in 2010. TKM sells models such as sedans Toyota Corolla Altis and Camry along with multi utility vehicle Innova.

TKM aims to capture 10 per cent of the Indian car market by 2015, mainly on the back of the Etios family. Overall, 15 lakh cars were sold in the country in 2009-10. Globally, Toyota was the world's largest carmaker in 2010 despite its consolidated sales declining by 4.4 per cent to 7.24 million units from the previous year.

Singh said the TKM could increase the output of Etios depending on customer demand from the current levels of 80,000 units a year. He said that for Etios sedan, TKM has received 3,077 orders within two days of the launch on Wednesday. The deliveries will start from January.

TKM Managing Director Hiroshi Nakagawa said about 70 per cent of the components of Etios are locally sourced. Only critical components like engines and transmissions are imported. "By 2012, we will shift the engine production to India followed by the transmission in 2013," he said, adding after that the localisation level would be 90 per cent.