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Old 18th August 2014, 23:40   #1
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Default Toyota India posts first-ever loss. EDIT: Turns around in FY15

After first-ever loss, Toyota hopes to rev up sales

http://www.thehindubusinessline.com/...cle6305158.ece

No concrete plans mentioned about how they are going to achieve it though.

Even though their Etios twins are selling very poor, I did not expect Toyota to incur loss as I felt that they should be making a fortune for every Fortuner and Innova.
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Old 19th August 2014, 11:25   #2
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Default re: Toyota India posts first-ever loss. EDIT: Turns around in FY15

They need a complete product re-jig!!

Etios and Liva operate in a competitive sphere. They have a great legacy yet the poor interiors and complete lack of focus from Toyota has killed the cars.

I have driven the Etios and in no parlance is it a substandard product.

My idea of covering the red and Breaking even:

1) Complete modification of the Etios. A mere cosmetic facelift with a change of the rear bulbs and the dash colour to blue will not help. Change the speedo console where it belongs. Include the MID which lower cars are also providing G and GD needs a tacho .Put the same in place. Add the features that competition is providing and you have a winner that is capable of close to 4K er month.

2) Ditto for the Liva as mentioned above.

3) Dont wait till 2017 to get the Vios. BRING IT NOW!!

4) Milking the Fortuner and Innova till the last drop? At least give the features that can further increase the sales. 02 airbags in a 25 lac car? Is it a joke?

5) The Corolla is doing well for the price it is in and the lack of features. That is attributed to the T Badge. Again, load it a bit. Highlight the additions and increase the sales.
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Old 19th August 2014, 14:25   #3
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Default re: Toyota India posts first-ever loss. EDIT: Turns around in FY15

For some reasons, the over reliance on reliability as the-all-end-all will be a very expensive strategy for the global T. Similarly, the slanted H can't be reliant on the fluidic design for ever (not saying that they are). My friend has a Etios Liva and it can be easily said that this car is rock solid. However, every time I think about it, it simply does not impress me at all. Innova, if cheaper than 2 lakhs which it should be, would be touching Bolero numbers though the global T wants to milk it to death.
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Old 19th August 2014, 17:37   #4
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Default re: Toyota India posts first-ever loss. EDIT: Turns around in FY15

I am sorry to bring down the expectations, but I dont think anything in the form of price reduction or increase in features are going to happen.

Toyota has made enough profit that it can afford to make losses for full 12months and still bear it. Nothing happened even when the plant was shut down due to labour unrest.

Nothing is going to change in Toyota. Already Innova is going up on the price level and so would the Fortuner.
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Old 19th August 2014, 17:43   #5
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Default re: Toyota India posts first-ever loss. EDIT: Turns around in FY15

Quote:
Originally Posted by scopriobharath View Post
I am sorry to bring down the expectations, but I dont think anything in the form of price reduction or increase in features are going to happen.

Toyota has made enough profit that it can afford to make losses for full 12months and still bear it. Nothing happened even when the plant was shut down due to labour unrest.

Nothing is going to change in Toyota. Already Innova is going up on the price level and so would the Fortuner.
Absolutely, Toyota has high IRR on each project it takes up. I would presume these to be notional losses. The Etios twins are already having decent margins as per the internal guidelines. This was confirmed by my close friend who works at Toyota. The only reason I see the red is the poor capacity utlization at Plant 2.
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Old 19th August 2014, 17:56   #6
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Default re: Toyota India posts first-ever loss. EDIT: Turns around in FY15

After reading all this, I cannot help but applaud Hyundai for they are able to launch their latest products with top notch quality and equipment at a cost which is not too much over the competition. Just look at the new i20. It looks rich and it feels rich and even though it may not be as engaging to drive as the competition, it is every bit as reliable (almost) as the Japanese.
It makes a convincing case for itself, even if you were to consider differential price, the price you have to pay over Liva for the extra features and performance. The Liva is 6.91 lakhs ex-showroom Delhi while the new i20 is 7.6 Lakhs for the Asta variant and comes with kit which makes the Liva feel barebones, has a more powerful engine, infinitely better interiors, bigger alloys, 6-speed gearbox and ofcourse the incentive of being the latest and the greatest product. I will happily pay 70ks over the top end Liva to get the Hyundai i20 and there in lies the problem. Toyota in India still has not learned the art of value engineering, something that the competitors seem to do so well. Even Tata with its latest Zest has reached a good balance of quality and performance.

Last edited by extreme_torque : 19th August 2014 at 17:57.
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Old 19th August 2014, 19:03   #7
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Default re: Toyota India posts first-ever loss. EDIT: Turns around in FY15

They deserve this. How could any company stop making product like Qualis which is its main profit earner & brand establish-er. I understand that they wanted Innova to succeed it. But successor should come in same price range! Even today also, There are very limited option in 6-8 Lacs UV market.

Tavera - No offence to existing owners. It is costly for loaded trims. After BS4 fiasco, nobody wants to believe on that diesel engine.

Bolero - Less on space. sle, slx & zlx are not proper 7 seaters. Other variants are not coming with any sort of creature comforts.

Sumo - After n number of revision, market simply lost faith in this product. Gold is actually good product. But in deepest corner of your heart, you are always worried about it's reliability & after sales.

I mean look at Maruti & Hyundai. They never stop selling products which are popular in market. They launch upgrade of the same at one class above.

We owned Qualis from 2002-12 and used it for 2.5L kms. And we are still searching for its new replacement in market. Practically void created by Qualis is still there in market. Bolero & Sumo are not up to the level of Qualis.

And yes helplessly, we are buying a new bolero(DI-AC) next week.
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Old 24th August 2015, 16:22   #8
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Default Re: Toyota India posts first-ever loss. EDIT: Turns around in FY15

Toyota India makes Rs. 529 crores in FY15.

Source
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Old 24th August 2015, 16:51   #9
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Default Re: Toyota India posts first-ever loss. EDIT: Turns around in FY15

Toyota has achieved what has been said in the article: They do have a whatever it takes retain the customer policy coming to the product quality. An Innova customer hardly would look outside of Innova if he is looking for a replacement. Though priced high, the customer hardly would get the space, comfort and ride quality offered by Innova in other MPVs.
Except for the Liva, others are all segment leaders (Innova, Fortuner, Corolla Altis, Camry) and there are way above competition.
Even Etios is treated with high regards as taxi, though it is not fared well among individual car buyers
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Old 24th August 2015, 17:15   #10
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To add further to previous post, while Liva is not the segment leader, Toyota surely knows how to keep Liva customers satisfied both with quality of the car and quality of service!
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Old 24th August 2015, 21:09   #11
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Default Re: Toyota India posts first-ever loss. EDIT: Turns around in FY15

To a certain extent, not much surprising. Toyota has just not got any new products to the India market. Not to mention the price premium they demand from Indian customers for the very limited product line they have. E.g. other than small facelifts, the Innova is virtually untouched in sales all these years...mainly thanks to the support from cab segment. Anyway, since a very good number of units were being sold in the cab & commercial segment, Toyota did not have enough apatite neither saw the need to bring anything new. Contrary they raised the price of the 'almost same' Innova, each year....and yet sold volumes. Today the Indian customers have more choices, may not be in the same segment but yet, with vehicles like Creta, S-Cross, Lodgy, Mobilo, XUV, better Scorpio, Terrano, Duster etc., certainly more options in a price sensitive market.

Although there are private buyers (for Innova & Etios), unlike Honda & Hyundai, Toyota's main income is from the taxi segment, be it Etios or Innova. And the taxi segment does not care about quality or fancy bells & whistles. Infact most Innovas' that are taxis are the G variant and not top end V variant. So Toyota was riding this high wave of premium pricing with no new product lineup in India. Of course their story in other market is different. They do give the latest & greatest to many other countries.

Toyota though has rock solid reliability and demands premium, has not bee able to excite the Indian customer with pricing v/s feature & looks ratio, e.g. Etios. Secondly, Toyota could have easily looked at getting the auto gear box Innova or the RAV-4 or equivalent to India earlier. But they chose to ride it out and reap profits. With the compact SUV segment (Duster, EcoSport, Terrano and now Creta etc.) showing demand, what is Toyota doing? Neither a compact SUV or a compact MUV (like the Honda Mobilo, Renault Lodgy etc.). They have been confident so far in the India market, to sell limited lineup dated products at a premium. I know quite a few people who actually went and joined the Mahindra club with an XUV purchase. These were the same population of people who debated hard on purchase of an Innova (for the T badge) v/s a Mahindra. If we see this trend across the country, this can give an indication as to how many customers Toyota actually helped move to the Mahindra club due to their current product lineup strategy.

Innova is INR 18L+ (top end) for such bland interiors (comparatively speaking). The Fortuner is now heading north of INR 30L. Then all the way down there is Etios which though a rock solid car performance wise, has the cab image and but no premium interiors. Basically Toyota does not have anything nice in the C2 segment.

There is a huge population out there who feel Etios is not up to the mark (cab image) but Corolla Altis is above their budget. What did Toyota do about this so far - nothing!

Anyways, hope this will now motivate Toyota to increase their product lineup strategy for the Indian customers. If they bring in the right lineup and price it well, it won't take them long to get to the top again, as the 'T' badge is already 'sold' to the Indian customers.
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Old 24th August 2015, 22:52   #12
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Default Re: Toyota India posts first-ever loss. EDIT: Turns around in FY15

The primary cause might be a lacklustre lineup. Though Etios and Liva are good and reliable in long run but the spark is missing. Also both these models are used by taxi operators which might be hampering its image a bit.
The Innova and Fortuner are bullet proof and rock solid products. Every upgrade pushes the price by couple of lakhs. After spending 27 or 29 lakhs you get 2 basic airbags and dated dash and interiors. The whole lineup needs a rejig.
There is not even 1 % doubt in reliability but looks too matter.

Last edited by MSC : 24th August 2015 at 22:54.
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