The Hindu : Business : Toyota Kirloskar's gearbox plant on stream

Online edition of India's National Newspaper
Wednesday, Aug 04, 2004

Business

Business

Toyota Kirloskar's gearbox plant on stream

By Harichandan A. A.

The Union Finance Minister, P. Chidambaram, inaugurating the transmission unit of Toyota Kirloskar Auto Parts in Bidadi near Bangalore on Tuesday. To his right are the Chief Minister of Karnataka, N. Dharam Singh, and the Vice-Chairman of the joint venture company, Vikram Kirloskar. — Photo: Bhagya Prakash

BANGALORE, AUG. 3. Toyota Kirloskar Auto Parts Private Limited today inaugurated a new gearbox manufacturing plant at Bidadi near Bangalore. The plant will supply 1.6 lakh units to Toyota Motor's assembly plants in Southeast Asia, South America and South Africa.

The joint venture makes front and rear axle assemblies and side steps for the Japanese car-maker Toyota Motor Corporation's multi-utility vehicle (MUV) in India, the Qualis.

It will now make the complete manual transmission for Toyota's new multi-utility vehicle, expected to roll out early next year.

The Union Finance Minister, P. Chidambaram, while inaugurating the transmission plant said this was "a proud day in the history of cooperation between industries in India and Japan.''

Ryuzo Kikuchi, Japan's Consul General in Chennai and some of Toyota's top executives, including Akiyo Toyoda, Senior Managing Director, and Norio Sato, Executive Vice President, were present.

The Karnataka's Chief Minister, N. Dharam Singh, and the State Industries Minister, P. G. R. Sindhia, urged the company to "make Bidadi the largest auto hub in this part of the country,'' pledging "everything we can do to help this industry grow here.''

Mr. Chidambaram said he anticipated continued growth of the Indian economy, which was among the few that could absorb large amounts of capital. "Concerns over the monsoon are receding. With all our prayers, there will be good monsoon even though a bit delayed, so there should be good agricultural production," he said. Broad sectors of the manufacturing sector too were doing well, with some outperforming the rest of the economy last year, he said.

On the new assembly plant, he said the third largest car maker in the world had trusted a plant in Bidadi to supply seven of its worldwide assembly lines reflected the high level of productivity Indian auto companies had achieved.

Vikram Kirloskar, Vice Chairman, said this was the first time an Indian auto component manufacturer was going to be a global source for a Tier-I (direct supplier) component maker. The joint venture is said to have won the project against close competition from Thailand and the Philippines, to which countries it will now export the gearboxes.

A ten year old plant in the Philippines and a two year old one in Poland are the only others making manual transmissions for Toyota.

Rs. 250 crore outlay

The outlay on the new project is Rs. 250 crores. Close to 40 per cent of the Rs. 180 crore worth of machinery in the plant was made in India. This "strong local machining industry and the availability of a large number of skilled engineers" helped cut costs at the plant. In the coming years, "process costs could come down further," Mr. Kirloskar said.

Full capacity shortly

The new transmission plant will go to full capacity in about six months. It is expected to add revenues of Rs. 250 crore as well, to the component supplier's present Rs. 80 crores to Rs. 100 crores. The plant has 19 modules, including a heat treatment shop with gas carburising and a tool room.

An additional 350 persons, including 30 engineers, would be needed to run the plant, taking the total workforce to some 550.

The plant had adopted the famed Toyota Production System was another factor in its favour, Mr. Kirloskar said.

Printer friendly page
Send this article to Friends by E-Mail

Business