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‘Toyota’s USP will not only be aptness of product, but also the ability to package a better ownership experience’

S.Muralidhar | Updated on September 23, 2020 Published on September 23, 2020

Naveen Soni, Senior VP, Sales and Service, TKM

The Urban Cruiser is Toyota Kirloskar Motor’s second vehicle to come out of the collaboration with Suzuki. The Glanza, based on the Maruti Suzuki Baleno, was the first. This is not the first time that two alliance partners have come together to simultaneously market what seems to be almost identical, badge-engineered vehicles. But, unlike the previous examples amongst brands that only managed tepid market acceptance, TKM claims that the Glanza was successful and that it expects the Urban Cruiser to also find takers amongst loyalists and first time Toyota buyers. Naveen Soni, Senior VP, Sales and Service, TKM spoke to BusinessLine about the new vehicle and the scope of the alliance with Suzuki. Excerpts:

What are your expectations from the Urban Cruiser and how is it going to contribute to Toyota’s India strategy?

This is going to help us travel into a new segment, one which is in the lower end of the market with larger volume potential. The sub-four-metre SUV segment has also been steadily growing from 3-4 per cent just a few years ago, to about 11 per cent now. And the two major enablers we see in the future are the new launches in this particular segment and the increased need for personal mobility. We expect this segment to contribute nearly 15-16 per cent of the car market.

For us the USP will not just be the inherent aptness of the product and the Toyota family traits in design and focus on safety, but also packaging the Toyota ownership experience including the showroom and after-sales experience. For the Urban Cruiser, we have also created extensive customisation options with 111 accessories on offer for our customers. Our engineers in Japan have worked on aligning the vehicle to make it meet Toyota family traits, compared to the shared vehicle from the alliance partner.

Does Toyota view the market performance of the Glanza as a benchmark or as a model worth adopting for other new vehicles that can be born out of this collaboration?

We are making a statement about the success of this alliance with the launch of the second product to come out with a shared platform. The Glanza was a very good start for us and the 28,500 customers in just over 13 months since launch have given us a lot of confidence that there are more waiting for other Toyota vehicles. The Urban Cruiser will be severely competitive in the marketplace. And though this may have been badge production that we may have taken from Suzuki, it is very important that we both complement each other while competing with each other.

Are there specific sales trends and market dynamics for the Glanza that also indicate the future potential for another vehicle born out of the collaboration.

The Glanza did throw up quite a few surprises for us during the first few months after launch. Nearly 50 to 60 per cent of the Glanza were first time Toyota buyers. The segment it was introduced in was, in terms of price point and demographics, not one in which Toyota was present at that time. So, we were attempting to attract a new set of customers who may or may not have seen a Toyota in the family.

Later, of course, we also did see more of the stable, loyal Toyota buyer who is more focused on word-of-mouth affirmation about a new vehicle from our stable. But, the Pandemic we are facing today, has hugely affected the customer dynamics and that has led to an overall fall in demand across brands and segments. Our loyal customers are ‘quasi-brand-ambassadors’ and that’s been our strength in dealing with the sudden changes in market climate too. But, we expect to bring in a lot of new buyers to the Toyota fold with every new vehicle that we launch.

We expect a lot of buyers from Tier 2 and Tier 3 cities and markets also. And we have been consciously expanding our presence in these cities and we intend to have an addition of more than 50 outlets despite the difficult market conditions caused by the Covid pandemic. We don’t want our customers to be forced to travel to a nearby town, which could be 50-60 kms away, for including the Urban Cruiser in his wish list. And this could be crucial in Tier 2 and Tier 3 markets.

Does the collaboration with Suzuki allow TKM to export vehicles like the Glanza or the new Urban Cruiser to other markets under the same brand banner?

A.Specifically there is already a guidance issued in the March 2019 announcement. There are references to the African and European markets where there can be cross-selling of each other’s products with their own branding. So both Toyota and Suzuki can dip into the other’s portfolio and market it as their own. There are no specific products, like the Glanza or Urban Cruiser, that have been identified. But, an enabling provision to adopt specific product strategies based on the market dynamics in these countries is already there.

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Published on September 23, 2020
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