Beyond manufacturing
Toyota Kirloskar Motor (TKM), the Indian subsidiary of the Japanese automaker, Toyota Motor Corporation (TMC), is an 89:11 joint venture between TMC and the Vikram Kirloskar-owned Kirloskar Systems that has been in India since 1997. The journey began with the iconic Qualis. Over the years, TKM has sold over 2.2 million vehicles in India, including several world-class products such as the Urban Cruiser Hyryder, the Innova Hycross (both with Hybrid EV variants), and the Hilux.
As part of the regional restructuring, the parent corporation has integrated India’s business into the ‘India, Middle East, East Asia & Oceania Region’, making these markets crucial to the global business landscape. This significant move reflects the increasing value of the country’s potential, derived from its dynamic and skilled workforce. During the recent completion of 25 years of operations in India, TKM announced a series of investments marking a substantial stride towards establishing India as a global hub for the manufacturing of clean and green technologies.
The TKM facility in Bidadi spans 432 acres and employs around 5,000 people in two plants with a total production capacity of 3,42,000 vehicles per year. With the high demand for Toyota cars, the plants operate at 100 per cent capacity utilisation. Through the company’s various productivity efforts, there has been an over 30 per cent increase in production, resulting in an output rise of around 31,700 vehicles per year.
The Toyota Production System (TPS), designed by the parent company, is implemented across the assembly line. The philosophy is based on the premise of making work easier on the shop floor through Just-in-Time, linking production processes in a continuous flow, and ‘Jidoka’, automation with human involvement. One unique characteristic of this principle is offering ownership of the process to every employee on the shop floor. It is said that in the case of detecting abnormalities, any employee has the right to stop the assembly line and prevent the defective product from progressing further.
The company believes in improving productivity by simplifying processes and creating ease and convenience for their workers. Another principle followed by the team is called ‘Karakuri’, which involves creating simple, energy-efficient engineering designs that improve work through low-cost mechanical innovations. Virodha Patil, assembly manager, said: “We offer employees multiple opportunities for growth under Bright Shop activity, a human skill development programme through global skill-up training. We send employees to Japan to be trained and come back to share their knowledge with their team members.”
As part of the expansion plans, a Memorandum of Understanding (MoU) has been signed between the Government of Karnataka and Toyota Kirloskar Motor for a new third plant in Bidadi, with investments of around R3,300 crore, to be completed in 2026. The production capacity is expected to increase by 100,000 units annually. The new plant will operate in two shifts and provide additional direct employment for 2,000 people.
The products
Toyota has a market share of 5.8 per cent with growth across its model range, including cars sold under both the Toyota and Maruti Suzuki badges, as part of a global partnership between the two Japanese parent companies. The company has a line-up of SUVs and MPVs, which include models such as the Innova Crysta, Innova Hycross, Fortuner, Rumion, and Hilux, and the sedan, Camry. The badge-engineered models include the Glanza (based on the Baleno), Rumion (based on the Ertiga), and Urban Cruiser Hyryder (based on the Grand Vitara). The partnership has also resulted in Maruti borrowing Toyota’s Innova Hycross (Invicto). The company recently launched the Taisor, a rebadged Maruti Suzuki Fronx.
During FY23-24, the company reached a sales volume of 2,63,512 units, marking a double-digit growth of 48 per cent compared to the preceding year and becoming the fourth-largest carmaker after Maruti Suzuki, Hyundai, and Tata Motors. The company has continued to record consistent increases in its monthly sales units. The rising market demand for Toyota’s vehicles is resulting in long waiting periods starting from two months for the Hyryder and stretching up to 14 months for the Hycross. The hybrid variants of both the Hyryder and Hycross have the longest waiting periods. Speaking about the situation, Vikram Gulati, country head and executive vice president, TKM, said: “While bookings are open for the models, we have introduced a third shift and strategies to improve efficiency to cover the production gap. We are very grateful for the enthusiastic support for our vehicles.”
While the Government of India is driving the change towards the adoption of electric cars as a green alternative to ICE vehicles, Toyota is steadfast in its commitment to hybrid vehicles. TKM and MSIL (Maruti Suzuki India Limited) are leading the hybrid car market with the Hycross, Hyryder, Grand Vitara, Invicto, and Camry. Meanwhile, globally, TMC has been producing hybrid variants for decades and aims to further help decarbonise internal combustion engines by making them compatible with alternative fuel sources.
As part of their electrification strategy, they intend to continue using the current ICE supply chain and increase electrified vehicle penetration while keeping ICE. Based on their assessment, company officials state that while the company can produce EVs (electric vehicles), they need to consider all available technologies to meet local conditions and diverse needs, hence they prefer to follow a technology-agnostic approach.
Subsequently, TKM will lobby for merit-based taxation on hybrid technology in the upcoming GST Council meeting after the elections. The GST levied on ICE vehicles, including hybrids, is at 28 per cent. And with the inclusion of cess, the tax rate for certain vehicles comes up to 40 per cent. Meanwhile, EVs are taxed at a mere 5 per cent. The move to offer tax concessions aligns with the Government’s view to tackle climate change and reduce emissions. “There is a need for the policies to match the objectives to meet our targets of carbon reduction and the national goals for decarbonisation. We hope that the Council will evaluate the needs of the market with the available technologies and decide accordingly,” remarks Gulati.
The people
Toyota has always valued human talent and believes in nurturing it through its Technical Institute. The Toyota Technical Training Institute (TTTI) was established in 2007 to provide three-year and two-year residential training in Automobile Manufacturing to young talent in Karnataka. The facility adjoins the Bidadi plant and offers its students hands-on experience in TPS. TTTI confers academic degrees certified by the Japan-India Institute for Manufacturing (JIM), Automotive Skill Development Council (ASDC), and Directorate General of Training (DGT) to 62 TTTI Regular and 41 Toyota Kaushalya students, under the scheme of DGT-Flexi MoU for students from rural Karnataka. The courses offered include Automobile Assembly and Automobile Welding, Painting and Mechatronics.
The training focuses on holistic development by imparting deeper knowledge of automobiles, enriching their skills as craftsmen, and developing their bodies through physical fitness activities. The students arriving at the institute are from vernacular mediums, rarely knowing any language other than Kannada and are generally of a shy nature. For this reason, the institute offers them lessons to improve their language as well as personality development skills. Their behaviour and attitude are shaped through the implementation of the Toyota way in every aspect of their daily life, from the way they dress to the way they walk. The students are expected to perform ‘shramdaan’, giving back to society through service in underprivileged communities.
Despite coming from diverse and challenging backgrounds, they are given the prospect of achieving their dreams and goals. To this effect, the students have won high honours at the National Skills Contest and World Skills Contest. The institute has graduated over 900 students who have secured 100 per cent employment opportunities. According to G Shankara, executive VP, finance and administration, TKM: “Since we started 17 years ago, we have seen a great transformation in the students and are planning to extend our methods across the state. We have also seen an increase in women’s participation and are creating awareness to inculcate skilling for them.” The facility offers the opportunity for rural, talented, and deserving youth to become industry-ready technicians with global standard skill sets. TTTI currently has 564 students, of whom 235 are girls. The institute has seen a surge in applications across Karnataka (4,600 this year). They have plans to expand their facility to accommodate more students, from 600 to 1,200.
The Toyota Environmental Challenge 2050 (Challenge 2050) is a set of global challenges to go beyond eliminating negative environmental impacts and create positive value for the planet and society. Their global goal is to become carbon neutral across the vehicle life cycle by 2050. The TKM Manufacturing Plant at Bidadi and 8 Onsite Supplier Companies have achieved 100 per cent renewable energy from June 2021 onwards.
The CSR activities include modernising government health centres, creating water purification units for safe drinking water, constructing infrastructure for government schools, the Toyota Anganwadi Development Programme, and the Ecozone. Ecozone is a 25-acre state-of-the-art environmental facility on the TKM premises. It was established to restore the native biodiversity. It includes 17 educational theme parks that highlight green mobility, sustainable architecture, water conservation, renewable energy, and other aspects of climate change.
Toyota culture follows sustainable practices in manufacturing and beyond. Their existing products and practices reflect their commitment to environmentally responsible actions.
AKSHAYA MATHRUBOOTHAM