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Toyota India chief outlines priorities with Suzuki

Murali Gopalan | Updated on February 07, 2019 Published on February 07, 2019

More to come Masakazu Yoshimura, MD, Toyota Kirloskar Motor, poses with the new Camry Hybrid KAMAL NARANG   -  Kamal Narang

Masakazu Yoshimura is categorical that the customer must reap most benefits at the end of the day

Masakazu Yoshimura has taken charge of Toyota’s India operations at a time when the parent company is in the midst of an interesting transformation in Japan. Mobility is now the name of the game and new alliances are being sewn up to take the global growth story to the next phase.

As the new Managing Director of Toyota Kirloskar Motor, Yoshimura also represents the rebooted face of his parent company, which recently recast its conventional hierarchy structure. As a result, young leaders will now be part of the new Toyota and this is where the likes of Yoshimura will have a big role to play.

Important alliance

It is less than a month since he took over as MD but is already raring to go. There is a lot of excitement ahead in the form of the alliance with Suzuki Motor Corporation, which will see some interesting dynamics panning out in India.

“Collaboration of different companies is a good thing,” states Yoshimura, since this means pooling in strengths in technology and resources which, in turn, will help offer a composite package. As he puts it, there are areas which Toyota “cannot individually cover” and it is only natural to work in tandem with an ally.

This explains why the company has little to show in terms of market share in India despite being around for two decades. The one big performing brand is the Innova, which took over from its equally successful predecessor, Qualis, over a decade ago but that is pretty much it in terms of outstanding brands from its stable.

On the contrary, Suzuki is a small player globally but extraordinarily successful in India where it has ruled the roost for over three decades now. “In India, Suzuki is very good at covering mini segments (A and B) which we are not good at. We can cooperate with each other a lot better this way,” reasons Yoshimura.

Product swaps are part of the partnership (in addition to initiatives like electric mobility) where the Vitara Brezza and Baleno will head out to the Toyota portfolio. In return, Maruti will get the Corolla, which will be sold from its outlets.

The process will kick in towards the end of this calendar and it will be interesting to see how the market reacts to a Toyota-badged Brezza/Baleno or a rechristened Corolla sporting the Suzuki badge. Eventually, from the buyer’s point of view, the new characteristics should ideally reflect each manufacturer’s unique DNA.

Yoshimura, however, believes it is important to think beyond such static concepts. “The DNA can be changed these days without a hitch. We need to change ourselves, however, and it is a matter of being flexible instead of sticking to your DNA,” he elaborates.

Changing environment

As Yoshimura puts it, the environment around is changing rapidly and the key is to be flexible “while taking another DNA and building ourselves strongly”. The solution lies in integrating different parts so that there is “constant evolution of the DNA”.

Going by what the Toyota MD has to say, there could be some surprises in store from the product swap initiative with Suzuki in India. He is equally categorical that neither company will compete with the other. This is because “the issue is not about Toyota or somebody else” but the survival of the auto industry as a whole. From Yoshimura’s point of view, the car is a unique product that creates a lot of emotion and aspiration. “We need to take a collaborative approach in these challenging times,” he says. This also puts in context why Toyota has joined hands with Mazda for North America while Daihatsu is spearheading the initiative in the ASEAN region. Yet, the Suzuki alliance is interesting because it is panning out in the world’s fourth-largest market, quickly on its way to overtaking Japan in the coming years. In the process, India will be in the third slot after China and the US though this is expected to happen sometime around 2022.

“There is a lot of mutual benefit in the Toyota-Suzuki alliance. We have many challenges ahead for sure but the more important thing is to look at what bests suits the customer,” says Yoshimura. Both companies are pulling out all the stops in customer satisfaction, which means that a critical component at the front-end is already strongly in place.

“The Indian market is very important for sure but the first thing I need to do is find out what is good for the buyer. Once I begin doing my homework, I will convey this to the product planning people,” says Yoshimura. This will also include taking to the Suzuki teams and coming up with a solution that works well for both companies and, of course, the end-user.

“I am very confident about the road ahead because it is good for the customer by the end of the day. If it is good for Toyota or Suzuki only, then I am not interested. If it is good for the customer, then it will be perfect,” sums up Yoshimura. Clearly, working in a new alliance is not the easiest of tasks since it means taking people from both sides along. This would involve building strong bonds between the teams of Toyota and Suzuki where they can sit comfortably across a table and be able to sort things out. By the end of the day, Toyota is clearly the bigger of the two globally but the equation is completely different in India where it is Suzuki all the way. This is where the real challenge of collaboration lies and the two Japanese companies will need to ensure that the show goes on without a hitch.

For now, the Toyota-Suzuki partnership is intended for India but there is no telling why the strengths cannot be jointly leveraged for other markets like Latin America and South Africa. As already indicated, Daihatsu will be the growth engine for ASEAN and, to that extent, the boundaries have been clearly defined at least for now.

Going beyond this could create needless confusion. “Daihatsu is good with Malaysia and Indonesia but if we collaborate with them for South America, for instance, the truth is that they have never played there. Why go ahead and create confusion?” asks Yoshimura.

Other Japanese tie-ups

Whilst on this subject, the discussion quite naturally veers around to the recent spate of collaborations within Japan’s automotive ecosystem. Beyond Toyota’s partnerships with Suzuki and Mazda, Nissan and Mitsubishi have come together as also former foes, Honda and Yamaha, albeit for a specific area in small scooters for Japan.

The Toyota India chief does not read too much into this and, instead draws your attention to the falling birth rate in his country. It is well known now that Japan is an ageing nation with more than its share of septuagenarians who are not buying fancy wheels.

In this backdrop, it is only natural for dealerships in Japan to feel apprehensive since customers are dwindling. The solution perhaps is for brands to get closer to be able to cater better to the shrinking domestic market. Yoshimura makes it clear that this is his personal view even while auto-makers are coming together from diverse geographies, with China leading the way, to work together.

The Toyota India boss is as excited about the mobility challenges ahead especially with rapid urbanisation happening across emerging markets like India. “We want to provide mobility solutions, which explains why Toyota is now being seen as a mobility company,” he explains. Wherever this is an opportunity, continues Yoshimura, the company will provide mobility solutions. “We have to be carefully monitoring future trends in markets like India and be flexible to grab chances and offer the right product/technology,” he says.

Published on February 07, 2019
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