Financial Daily from THE HINDU group of publications
Thursday, Oct 20, 2005
Financial Daily from THE HINDU group of publications Thursday, Oct 20, 2005 |
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Corporate
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Performance Toyota set to wipe out losses — Innova on a roll K. Giriprakash
Bangalore , Oct. 19 WITH the Innova on a roll, Toyota-Kirloskar is set to wipe out its accumulated losses of around Rs 300 crore by December. Sources in the company told Business Line that Toyota also expects a 30 per cent rise in revenues in the current fiscal. They added that the company had set a target of three years for breaking even and posting net profit within six years of commencement of operations in India. Toyota's revenues in 2004-05 were around Rs 2,500 crore (net of excise duty) and in 2005-06 they are expected to be around Rs 3,200 crore. Mr T. Ino, Director (Marketing), said that during the first seven months of its launch, the Innova sold a record 24,507 units, impacting even the sales of the mid-sized sedan, Corolla. "But we are not worried (about Innova eating into Corolla's sales) as customers are not moving away from Toyota," he added. Mr Ino also said that the sales of even the lower-priced Innovas had picked up and their stock had reduced considerably. "We have started getting orders from the BPO taxi segments for the low-end models." According to him, between April and September the Corolla sold 4,421 units compared with 5,200 units during the same period last year. But its market share increased to 31 per cent from 29 per cent during the same period. The Innova's sales were also the highest among multi-purpose vehicles and sedans during the first seven months. The Scorpio sold 17,178 units, the Sumo 17,987, and the Tavera 10,419 units. In the mid-sized segment, Mr Ino said, Honda City sold 24,089, Optra 4,496, and the Octavia 4,247 units. A spokesperson for General Motors, however, said that its multi-utility vehicle, Tavera, operates in a different segment and so was the case with its mid-sized car, Optra. Mr Ino said that the company has effected a price hike of Rs 5,000 for the high-end Innova model, while the prices of the low-end and mid-range models remain unchanged. "The sales of the low-end and mid-range models have started stabilising; hence, we don't want to revise their prices now." According to sources, Toyota has invested around Rs 700 crore in the Innova during the last 6-8 months. In 2003-04, it invested around Rs 80 crore for vehicle upgrades and other activities.
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