Inside Maruti and Toyota's plan to completely dominate India's auto market

Mumbai: Toyota Motor Corporation and Suzuki Motor Corporation on Friday revealed broad contours of their evolving partnership that centres around India.

Within two months of agreeing to share product portfolio, the Japanese carmakers with a significant presence in India have proposed that they also eye synergies by sharing infrastructure such as factories and dealer networks in India.

The move will enable Maruti Suzuki to tap into the under-utilised manufacturing base of Toyota in India, and the latter will use Maruti Suzuki's network to expand into smaller towns. The companies have also expanded the scope of the alliance to Africa using India as a manufacturing base. Maruti-Toyota collectively contributed almost half of the government's GST collection from the passenger vehicle market and sell about 55% of total passenger vehicles sold in India.

RC Bhargava, chairman, Maruti Suzuki said the move is a win-win. If Maruti needs capacity and Toyota has underutilised capacity, it is in the interest of both parties to utilize the same, he averred “Progress is happening at a reasonable speed. Synergies of this partnership is huge and can save millions of dollars for both the companies.

Given the demands of emission norms, de- velopment of powertrain together will be of great help and addition of mar- kets of Africa will furt- her increase the volume potential," Bhargava added.

A joint statement on Friday said the duo has started discussing new joint projects in the fields of technological development, vehicle production and market development. Key topics will include Denso Corporation and Toyota to provide Suzuki with technological support for a compact, ultra high efficiency powertrain.

“Such (progress) represents the spirit of “Let’s do it” that I mentioned when announcing the conclusion of our memorandum of understanding on beginning concrete examinations for business partnership. Or, as I like to say, Suzuki is a company that puts into practice being The Best in Town,” said Akio Toyoda, president, Toyota Motor.

Osamu Suzuki, chairman, Suzuki Motor, said it is his hope that the new joint projects will contribute to the future success of both companies, not only in India, but world over. Suzuki alluded to benefits accruing to his company, “Now, we will receive support for the development of a compact, ultrahigh-efficiency powertrain that is vital to Suzuki, and we will focus our utmost efforts on development.”