Crisis or not, Toyota sticks to just-in-time

The crisis in Japan has brought home the importance of increased localisation at Toyota Kirloskar Motors, but the world’s largest car maker is still loath to abandon its famous just-in-time (JIT) practice.

So as it continues to follow the JIT principle in parts’ procurement, production of vehicles and inventories, Toyota says production loss of this fiscal would be 10,000 units because of the Japanese crisis.

“These things (tsunami and earthquake) happen once in 100 years, there is no reason to change the JIT philosophy. Car production is a very complicated business, very difficult to handle ... It becomes smooth with JIT. On localisation, we are already taking all steps to increase it across our products,” Toyota Kirloskar managing director Hiroshi Nakagawa said Thursday.

He said after the Japanese crisis, the waiting period for some models (Etios sedan particularly) has risen significantly but the company changed the product mix and taken other steps to correct this.

So Etios, for which customers had to wait for six months earlier, is now available within 8 weeks and this will go down further to less than 4 weeks before June is over, he said.

Sales of Etios and the Etios Liva (hatchback on the same platform) are projected to be over 60,000 units this year.

Innova, Toyota Kirloskar’s largest-selling product till date, will also be available sooner now since production per month has been increased from about 4,000 units to 4,800 units.

Deputy managing director Sandeep Singh said the company will produce 2.1 lakh vehicles in all this year, with 1.2 lakh driving out of the new factory.

The Liva is slated for a June-end launch.

Toyota on Thursday also launched a new variant of premium sedan Corolla Altis in both petrol and diesel options.

The petrol variant is priced at Rs10.53 lakh to Rs14.77 lakh, while the diesel option will be available for Rs11.46 lakh to Rs14.55 lakh.

The company is eyeing 11,500 unit Corolla Altis sales this year against 10,400 in 2010. Toyota had earlier announced plans to invest Rs300 crore to ramp-up its production capacity by 60,000 units to 2.1 lakh units annually by mid 2012.

When asked if the company would export Etios, Nakagawa said: “Our focus is India. But we are currently studying the option.”