Toyota to begin trial production of diesel engines soon in Bengaluru

The company's new diesel engine plant will start commercial production in early 2016

The diesel engine factory of Toyota Kirloskar Motor (TKM), Indian subsidiary of Japan’s Toyota Motor Corp, will be ready for commercial production by early 2016.

Coming up at Jigani on the outskirts of this city, it will start trial production soon, an official said. Set up at a cost of Rs 800 crore, it will have initial capacity of 100,000 units annually.

“The plant will cater to engine requirements of the Innova and Fortuner models. Currently, we are importing diesel engines for these models from our plant in Japan,” T S Jaishankar, deputy managing director, commercial, told the Business Standard.

The facility is coming at the premises of Kirloskar Toyoda Textile Machinery — the company has almost entirely used up its land at Bidadi, near here, where it has two passenger car manufacturing units. Toyota already has a petrol engine manufacturing unit there, which it set up in 2011, at an investment of Rs 500 crore through another subsidiary in India, Toyota Kirloskar Auto Parts.

The production of diesel engines in India will enable the car maker to increase localisation in Indian operations to around 80 per cent. The Indian arm had in 2012-13 made the proposal to the Japanese parent to set it up, as the demand for diesel cars was rising sharply.

Two years ago, TKM increased the yearly installed capacity of its two car manufacturing units to 310,000 units at Bidadi. It produces the Innova and Fortuner at the first plant. The Etios and Etios Liva, Corolla Altis, Camry and Camry Hybrid are produced at the second one.

The Prado, Land Cruiser and Prius are imported as completely built units and sold in India.

The company sells around 5,000 units of the Innova every month. In 2014, TKM sold 132,778 vehicles, a decline of 8.5 per cent over the previous year. In 2015, till April-end, it had sold 50,110 units; in the entire year, it hopes to sell around 160,000 units, including exports. Toyota ships to Nepal, South Africa and Kenya from the Indian plant.

Jaishankar said there was no plan to introduce new models in 2015. Instead, they want to focus on existing products like the Etios Liva Cross, launched recently, and other premium sedans.