Alliance with Suzuki works well for Toyota in India

With the launch of Baleno and Vitara Brezza from Maruti Suzuki stable, Toyota has seen a remarkable jump in its sales

The alliance between Japanese automobile majors, Toyota Motor Corp and Suzuki Motor Corp is now two years old in India. The alliance, which includes equity investment into each other and rebadging of some of their popular models, seems to have worked well for Toyota so far in India.

To start with, Toyota rebadged Baleno from Maruti Suzuki with a 1.2-litre petrol engine, which received a very good response. Later, the company introduced Suzuki Vitara Brezza as Toyota Urban Cruiser. There is no difference between both SUVs. They both offer a 1.5-litre petrol engine coupled with a 5-speed manual gearbox.

Another model from the Maruti Suzuki stable such as Ciaz is likely to be rebadged by Toyota with small changes in the coming days. Urban Cruiser is manufactured by Maruti Suzuki India at its plant in Manesar, while Glanza is produced by Suzuki at a plant in Gujarat.

With the launch of both the models from Maruti Suzuki stable, Toyota has seen a remarkable jump in its sales. For example, in FY20-21, Toyota Kirloskar Motor, the Indian arm of Toyota Motor Corp, recorded total sales of 93,134 units, degrowth of 18 per cent over the previous year. However, 42 per cent of the total sales came from Glanza and Urban Cruiser. The company sold close to 39,000 units of Glanza and Urban Cruiser. While the Glanza sales were 22,530 units, Urban Cruiser sales were 16,316 units.

"As of March 31, 2021, we have clocked total sales of more than 61,000 units for the Toyota-Suzuki alliance models (Glanza, and Urban Cruiser). Toyota had launched Glanza in June 2019, while the Urban Cruiser was unveiled in September 2020," Naveen Soni, Sr. Vice President, TKM told DH.

Read | Toyota says it will introduce 15 BEVs, expand electric lineup by 2025

Even during the first two months of FY22, about 93 per cent of the total sales came from Glanza and Urban Cruiser. These two models accounted for 4,968 units out of total sales of 5,361 units during the first two months. Toyota sold 2,480 units of Glanza and 2,488 units of Urban Cruiser in April and May this year.

The sales of Glanza could have been much more during the year. Since April 2020 was completely under national lockdown due to the Covid-19 pandemic, there were no sales.

"The alliance with Suzuki is in our favour. A large part of Indian customers is still growing in the low-end of the market. They can now experience the Toyota service quality. Most of our sales come from repeat customers. Once they are used to our service quality with entry-level products, they will migrate to high-end of the vehicle market gradually," Soni said.

Meanwhile, TKM is also working on reducing the waiting period for four of its vehicles such as Glanza, Urban Cruiser, Fortuner, and Innova.

“Inventory is precious to us. We are not keeping inventory at the dealerships. Based on the orders, we manufacture and supply. We are making sure that orders are met as per the customer’s choice,” he said.

Currently, Fortuner has a waiting period of two months. Toyota is working to reduce it to one month by getting more allocations from its overseas suppliers. “We will be increasing the production and produce the right vehicle at the right time,” he added.