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Old 23rd April 2011, 08:25   #1
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Default Toyota to cut India output by 70%. EDIT on Pg 2 : To resume operations by 20th May

Dear Folks

Plan for a more longer deliveries for already in demand - Toyota Cars


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NEW DELHI: Japan's Toyota Motor will cut production at its Indian subsidiary by up to 70% between April 25 and June 4 due to disruption of supplies following last month's earthquake and tsunami in the country's northeast. The two Bangalore-based plants of Toyota Kirloskar Motors, the joint venture between Toyota and the Kirloskar group, will not operate on Mondays and Fridays during the period.

The restructured production plan will see about 7,000 fewer vehicles being produced a month, leading to a revenue loss of around 500 crore for the Indian subsidiary. The world's biggest automaker produces 11,000 units a month at its JV, in which it holds 89% equity.

"It is a temporary measure to adjust production as per the supplies from our overseas locations. Based on the availability of components in future, we will chalk out our future strategy," said Sandeep Singh, Toyota Kirloskar Motor's deputy MD (marketing). In India, Toyota produces the multi-utility vehicle Innova, premium sedan Corolla Altis, SUV Fortuner, and the Etios sedan, which has a long waiting period.
Source : Economic Times of India

Last edited by .anshuman : 23rd April 2011 at 10:48. Reason: News Article put into quote. Thanks
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Old 23rd April 2011, 10:36   #2
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Default re: Toyota to cut India output by 70%. EDIT on Pg 2 : To resume operations by 20th May

This is very short term thing, probably this shortage will be only for few months.
In US Toyota has declared that they will be able to return to the old volumes by Sep-Nov time.
But of course, very bad news for Toyota, which was hitting new volumes with the launch of Etios Seadan.
I was seeing so many Etios recently on road and thought it was nearing to be termed as a box office
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Old 23rd April 2011, 10:48   #3
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Default re: Toyota to cut India output by 70%. EDIT on Pg 2 : To resume operations by 20th May

This may not be short term, at least not as short as many assume. Several component units are still down in Japan and many high-tech manufacturing facilities are permanently destroyed (e.g. semiconductor foundries and speciality chemicals - their output effects every other industry)

Two decades age a factory of Philips Semiconductor had a fire. That wiped out Ericsson cellphones from the face of the earth - though they didn't know that for months afterwards.
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Old 23rd April 2011, 11:19   #4
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Default re: Toyota to cut India output by 70%. EDIT on Pg 2 : To resume operations by 20th May

I think this situation is applicable for other Japanese players like Honda and Suzuki. We have seen low sales of Honda cars and this could be one of the primary reasons for low sales.

So this means that companies still do not manufacture complete car in India only as i read the news in TOI and there was mentioned that components of engine and gear box are imported from japan.

And this will increase the waiting time for high demand cars like Toyota Fortuner. Customers may not like to wait and switch to some other manufacturer/model.
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Old 23rd April 2011, 14:35   #5
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Default re: Toyota to cut India output by 70%. EDIT on Pg 2 : To resume operations by 20th May

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Originally Posted by bluevolt View Post
I think this situation is applicable for other Japanese players like Honda and Suzuki. We have seen low sales of Honda cars and this could be one of the primary reasons for low sales.

So this means that companies still do not manufacture complete car in India only as i read the news in TOI and there was mentioned that components of engine and gear box are imported from japan.

And this will increase the waiting time for high demand cars like Toyota Fortuner. Customers may not like to wait and switch to some other manufacturer/model.
almost no car you can buy has components that are imported. Come to think about it - every single IC used in anything you buy is imported.
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Old 23rd April 2011, 18:26   #6
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Default re: Toyota to cut India output by 70%. EDIT on Pg 2 : To resume operations by 20th May

How will that affect the launch of the Liva??
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Old 23rd April 2011, 18:55   #7
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Default re: Toyota to cut India output by 70%. EDIT on Pg 2 : To resume operations by 20th May

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How will that affect the launch of the Liva??
I thought Liva launch had been announced to be delayed earlier - Toyota Liva and Etios Diesel delayed to 2012 | Indian Autos blog

this was even before the earthquake
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Old 23rd April 2011, 20:09   #8
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Default re: Toyota to cut India output by 70%. EDIT on Pg 2 : To resume operations by 20th May

things i see in this:

a. toyota is honest enough to admit.I'm sure honda must also be facing problems but they haven't come clean.or maybe their indian sales are not high enough to see a big dent.

b. this should be an opportunity for jap car manufacturers to move more of the higher-end manufacturing processes to india.they wouldn't do it normally.same applies to the 'marquee' germans. they really need to bring more of their processes here, bring down the price tags and see how sales sky rocket. everyone wants to own a merc!
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Old 23rd April 2011, 20:25   #9
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Default re: Toyota to cut India output by 70%. EDIT on Pg 2 : To resume operations by 20th May

Owners of Toyota cars and MPV's/SUV's will have to be very careful while driving or using their machines.This is because the throttling of the component supplies from Japan may also hit the supply of spare parts and replacements from their plants over there.
So any major repairs or overhauls may get affected due to the shortage. That will ground the machine at the workshop for longer durations.
Toyotas are very reliable and need too little care and part replacements, but there are the odds always, working against the rules.
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Old 23rd April 2011, 21:07   #10
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Default re: Toyota to cut India output by 70%. EDIT on Pg 2 : To resume operations by 20th May

Earlier the same earthquake situation was said to not affect much the Indian scene due to greater localization, even the dealers and the Toyota communications were projecting the same, even on Facebook/Toyota Etios. This will be some jolt to people who had anticipation of not getting affected for their deliveries, especially of Etios. Maybe it was coming anyway and was just hoping that it would not affect. But atleast good that Toyota is frank enough to admit and publish the situation and make people aware of impending delays.
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Old 24th April 2011, 00:26   #11
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Default re: Toyota to cut India output by 70%. EDIT on Pg 2 : To resume operations by 20th May

Well most manufacturers have buffer stocks so immediately after the earthquake it did not affect them.It is only know as the buffer stocks have run out,and suppliers in Japan are not able to provide fresh supplies,its now that its affecting others.

Expect the Liva launch to be pushed back even more,3rd quarter of 2011 i am guessing.

Wonder if Honda will be affected too,although not too sure how much they depend on Japan for supplies.
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Old 24th April 2011, 12:03   #12
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Default re: Toyota to cut India output by 70%. EDIT on Pg 2 : To resume operations by 20th May

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Originally Posted by vina View Post
I thought Liva launch had been announced to be delayed earlier - Toyota Liva and Etios Diesel delayed to 2012 | Indian Autos blog

this was even before the earthquake

Yes.But there was speculation that it was going to launched somewhere around june-july,this was posted by someone in the liva thread.
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Old 24th April 2011, 13:37   #13
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Default re: Toyota to cut India output by 70%. EDIT on Pg 2 : To resume operations by 20th May

Quote:
Originally Posted by avishar View Post
Well most manufacturers have buffer stocks so immediately after the earthquake it did not affect them.It is only know as the buffer stocks have run out,and suppliers in Japan are not able to provide fresh supplies,its now that its affecting others.

Expect the Liva launch to be pushed back even more,3rd quarter of 2011 i am guessing.

Wonder if Honda will be affected too,although not too sure how much they depend on Japan for supplies.

The buffer stock is also known as inventory. And the Just-In-Time manufacturing method that Toyota is reputed to have taught the world minimises inventory. Things are not as simple though because usually doing this pushes the inventory on to the suppliers (rather than eliminating them from the full production supply chain) - and this means Toyota itself can not reasonably predict what is going on.

While companies can predict what is in their control, what is not can be tricky. FT Press: The Fire That Changed an Industry: A Case Study on Thriving in a Networked World > Design Principles for Adaptive Businesses is the story of Ericsson I referred to earlier. You can find more about it all over the internet.

I don't know the exact situation, my point is with supply chains as complicated as they are, nobody can know.
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Old 26th April 2011, 09:20   #14
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Default re: Toyota to cut India output by 70%. EDIT on Pg 2 : To resume operations by 20th May

Toyota's circular in today's B'lore Mirror.
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Old 26th April 2011, 09:22   #15
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Default re: Toyota to cut India output by 70%. EDIT on Pg 2 : To resume operations by 20th May

Quote:
Originally Posted by avishar View Post

Wonder if Honda will be affected too,although not too sure how much they depend on Japan for supplies.
Read that Honda too would downsize production in India for a while. Suzuki claims they are not hit and would maintain the same production levels.
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