Toyota, Suzuki ink pact for mutual supply of hybrids in India

Toyota, Suzuki ink pact for mutual supply of hybrids in India

Japanese auto giants Toyota Motor Corporation and Suzuki Motor Corporation on Thursday concluded a basic agreement towards the mutual supply of hybrids and other vehicles between the two companies for the Indian market.

Specifically, Suzuki will supply gasoline and mild-gasoline hybrid versions of the Baleno and the Vitara Brezza to Toyota, while the latter will produce gasoline and gasoline-hybrid Corolla for Suzuki. Details on each model, such as the schedule of the start of supply, number of supplied units, vehicle specifications, and supply pricing, will be considered at a later stage, a joint statement by both the companies said.

"The vehicles will be sold by respective subsidiaries of Toyota and Suzuki based in India through their sales networks. By challenging and competing with each other, with the goal of mutual improvement, Toyota and Suzuki aim to invigorate the Indian automotive market to further enhance their respective products and services to be offered to customers," the statement added.

Since February 6, 2017, when Toyota and Suzuki concluded an MoU fostering business partnership, the two companies have been exploring concrete projects for collaboration in areas including environmental technology, safety, IT, and the mutual supply of components. As a result, the two plan to introduce electric cars in India around 2020.

According to the Nikkei business daily, Toyota is expected to supply around 10,000 vehicles to Suzuki, while Suzuki would produce up to 50,000 units annually for Toyota.

Suzuki has dominated the Indian automobile scene through its stake in Maruti Suzuki India, the country's largest carmaker, with sales upwards of 16 lakh vehicles last year.

Analysts said that the arrangement also helps Toyota expand its presence in the country, where it has struggled to grow sales due to lean demand for its lower-end models. The company sold 1.4 lakh cars in India last year, with 5% market share.

An auto expert, on condition of anonymity, told DH: "If we're to consider hybrids, Maruti Suzuki is one manufacturer which has the capability and scale to economise the technology and make it more mainstream in India. And if global auto leader Toyota is to partner Suzuki, the Indian market is in for a boom."