Corporate File

‘Customer trust in brand Toyota has been our driving force’

K Giriprakash | Updated on April 25, 2021

Pit stops on Toyota Kirloskar Motor’s Indian odyssey

In this interview, Vikram Kirloskar, Vice-Chairman, Toyoto Kirloskar Motor, talks about the rationale of aligning with Suzuki and the frequent worker strikes. Excerpts:

TKM was one of the first carmakers to develop a made-for-India car. The Etios and Liva were considered best-in-class models. But both were phased out around 2019. Why?

At TKM, as part of our global product strategy, we continuously evaluate the market to understand customer preferences and trends. This also applies when we have to discontinue an existing model to vacate plant capacity for advanced and better technologies to come in. We want to enhance customer experience at every step. This is the biggest reason why customers choose a Toyota vehicle — for our exceptional service... we have seen tremendous response from our customers for the alliance models we introduced such as the Glanza and Urban Cruiser. Until March 31, 2021, we have clocked sales of more than 61,000 units for these two models.

By aligning with Suzuki and rebadging their popular models, will it not hurt the Toyota brand? Toyota’s Qualis, Innova, Fortuner and, to an extent, Etios have been successful. Shouldn’t that induce TKM to launch its own products?

The basic idea of the global alliance between Toyota and Suzuki was to collaborate through a strategic partnership to cover segment areas in which each company has room for enhancing its product line-up. TKM launched two alliance models — Glanza in June 2019 and Urban Cruiser in September 2020 — and both have been a runaway success for us... a testament to the customer confidence in buying from the alliance. The biggest differentiator for us in the market is our after-sales service experience... the extended warranty packages that we provide at affordable budgets is a major draw for customers.

TKM operations have been frequently disrupted by workers’ strike. The longest so far ended recently. What are the reasons for the strikes and how will you avert them in future?

TKM has been at the forefront of providing a conducive working environment including competitive compensation packages, as well as unique welfare measures over and above the statutory requirements, to improve the quality of life of its workforce. We strive to provide equal opportunities for growth across all levels and business domains. We also provide all unionised employees with various platforms to participate in global events and competitions, thus creating continuous learning and development opportunities. TKM will continue to work towards strengthening this value system by fostering relationships based on collaboration, trust, discipline and mutual respect. We are hopeful such an approach will help us avoid employee strikes in the future.

The second plant of TKM can produce 2.1 lakh units per year. With most of its models phased out, how will you deploy the huge capacity?

Our capacity is adequate to meet the current and future requirements of the market. Besides, capital investments are made with a long-term objective, with enough flexibility to accommodate mid- to- long-term business plans. Similarly, we are harnessing our capacities to cater to the market demand, including our alliance strategy, by reserving some bit of the capacity considering our future product strategies under the Toyota-Suzuki global collaboration, including using it for electrification technologies.

Over 21 years, what have been the sweet spots for the company? Will the joint venture between Toyota and Kirloskar continue with the same equity holding?

For us, the driving factor or the sweet spot is the trust placed by customers in brand Toyota. Over the years, our consistent and focused approach to being identified as a brand that builds lasting relations with generations of customers has pushed us to make better cars that exceed expectations. We believe that Toyota should not just be a company to make new models, we take immense pride in the retention rate of our customer base. Electrified vehicles are a growth area for the future and Toyota has all the electrified technologies in its global portfolio. As far as the equity holding is concerned, as a matter of policy, we do not comment on our future business plans.

Published on April 25, 2021

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