Toyota Kirloskar Motor (TKM), the Indian joint venture (JV) between Toyota Motor Corporation (TMC) and the Kirloskar group, anticipates robust sales growth in 2023 on the back of recent launches like the Hyryder SUV and the Innova Hycross. Talking to Moneycontrol at Auto Expo ’23, Vikram Gulati, TKM’s country head and Executive Vice-President of Corporate Affairs, said that the company was keen to introduce products in the sports utility vehicle (SUV) segment. While some models could be taken from its global portfolio, some will be built from scratch for the Indian market. Below are edited excerpts from the interview:
Can you talk about the products and technologies you have showcased at the expo that are not ICE-based?
When you say internal combustion engine (ICE), it's a misnomer. A vehicle may have an electric powertrain, or it may have an ICE powertrain. We have two vehicles that run on hydrogen. One uses a fuel cell. The other uses an ICE engine that runs on hydrogen. Then there is a flex fuel vehicle, which is capable of running on ethanol. That's the fastest way of displacing fossil fuel today.
We have displayed here a Toyota Mirai FCEV, Toyota Corolla Flex-fuel, Toyota Prius PHEV. Also, there is a BZ 4X electric SUV that we sell globally. Plus, we have some electric vehicles in our Lexus line-up. If you look at the 2030 goal that we have for our product mix, of the 10 million-odd vehicles we will sell, 3.5 million are going to be pure electric.
With the government pushing for zero-emission mobility, how have you realigned your product lines?
Our focus has been on sustainability for a long time. In 2015, we set a global target of reaching zero emissions, not only from the tailpipe of vehicles, but much beyond – in the entire life-cycle of vehicles. We aimed for zero carbon impact right from the birth of the vehicle, to recycling. That is, right from the raw materials, the supply chain, to manufacturing, on a well-to-wheel basis.
Battery electricity is obviously one important technology which will help you get there. But it's not the only one. There are various technological options, which include many energy pathways. For instance, we can have significant efficiency gains using a self-charging strong hybrid, which offers the options of both taking energy from the grid as well as general generating on-board. The relevance and the impact of each pathway will depend on the market segment you're looking at.
What kind of electric vehicles (EV) are you bringing to India? What’s your long-term sales target for EVs?
We have not yet decided about introducing EVs in India. EVs aren’t really that complicated and challenging a technology. Because the powertrain that you have in a battery electric is the same one that goes into a hybrid.
We've invested Rs. 5,000 crore recently in clean technologies, particularly electric. A significant amount of this has gone into manufacturing the e-drive, which is the drivetrain of the electric powertrain in India. In Asia, this is the first EV component plant outside of Japan. This supplies not only to the Hycross and the Hyryder, but also to Japan for use in the entire range of EVs.
So in the near- to medium-term, we won't have any pure EVs from Toyota?
We don't want to declare what we're going to do in future. Why should we rule out any possibilities if we feel that there is a consumer need that we can nicely and adequately meet. We always like to look at what the consumer wants, what is the readiness of the market, and the most appropriate technology. If those boxes are ticked, there is nothing that we will not introduce. It will be introduced at the right time when we feel we can make an impact.
As people are increasingly migrating to SUVs, will we see some global products by Toyota in this segment? Or will it be more India-specific SUVs?
This will be largely dependent on consumer requirements. You will have a mix of both in this segment. If you look at the Hyryder, it's a homegrown product, designed and made for this market. The Hycross is the next generation of innovation. So these represent probably an element of both. I cannot say Innova is global because it has become a very local brand.
So two of the products we sell have a very strong local DNA. As we go forward, all options are on the table. In the premium segment, we have very good traction for the Vellfire, which is an MPV.
With the discontinuation of the Etios twins, the Yaris, and the Corolla, is it safe to assume there will be a sharper focus on SUVs than hatches and sedans?
We take decisions based on consumer needs. Yaris is still being sold and it is a very successful product globally. But based on our plans for the market, at times we pull out products. Not necessarily because it’s not doing well. Again, it's about listening to what the market is telling you. It’s like you said, the market prefers SUVs.
But that doesn't mean that going forward we won't get into sedans. For example, Camry continues to be a segment leader. It's what the consumer wants. So tomorrow if people want sedans, we will give them. If people want SUVs, that too will happen.
What numbers did you clock last calendar year? What’s your projected sales for this year? Which model will have the maximum volume?
We sold about 155,000-160,000 vehicles last calendar year. I think our market share was around 4 percent. We are looking at a significantly higher number this year, and we’re very optimistic. There’s huge demand for both the products we’ve launched. They've been received very well by the market. We are now trying our best to make sure that we are able to deliver these products at the fastest possible pace. Hydryder will be the biggest volume driver.
Analyst's project that in the long-term the Indian passenger vehicle (PV) market will see volumes of 7-8.5 million cars per year, and we feel that's possible. We aspire to play a much more meaningful role in that market.
Lastly, your expectations from the government in the upcoming budget?
The government has very clearly outlined its expectations and goals. It’s aiming for energy independence by 2047 and being zero carbon by 2070. It's a clear goal for everybody and we should work towards it. Our one request is that please align the taxation with the goals so that industry can deliver those goals. At the end of the day, if green technologies are not encouraged, they will not find consumer acceptance.
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