Toyota Kirloskar Auto Parts to set up third plant in Bangalore

Bangalore: Toyota Kirloskar Auto Parts is setting up its third manufacturing plant for automotive components at Bidadi, about 32 km from Bangalore. The company is investing Rs 500 crore to set up the plant.

Toyota Kirloskar Auto Parts is a joint venture between Toyota Motor Corporation, Japan, Toyota Industries Corporation, Japan, and Kirloskar Systems, Bangalore. The Toyota group holds 90 per cent stake in the company, which already operates two manufacturing plants at Bidadi — for exports, as well as the domestic market. At these plants, the company manufactures manual transmissions for ‘Fortuner’ units manufactured in India, Thailand and Argentina. It also produces front and rear axles and propeller shafts for the ‘Innova’ units made in India.

According to an official notification issued by the Karnataka government, a high-level clearance committee, headed by Chief Minister D V Sadananda Gowda, had recently approved the company’s proposal to set up a third plant to manufacture castings and machine parts, the memorandum of understanding (MoU) for which was signed at the Global Investors’ Meet in Bangalore on June 7 and 8.

With the fresh investment, which would create 150 jobs in Bangalore, total investment in the company would rise to Rs 1,000 crore.

At the proposed plant, Toyota Kirloskar Auto Parts plans to manufacture 240,000 castings of engine parts and 120,000 units of machine parts. The company has sought an additional 17 acres from the government. The Karnataka Industrial Areas Development Board would acquire the land for the company, provided the company secures consent for this from 80 per cent of farmers who own the land. The board has also sanctioned 6,00,000 litres of water a day for the new plant.

“We have signed an MoU with the state government for an investment of Rs 500 crore for the new capacity. As part of the new investment, we would manufacture petrol engine parts and transmission units for Toyota’s small car, the Etios Liva, and the Etios sedan. We will export 55 per cent of the 2,40,000 transmission units to Toyota’s Brazil facility, while the remaining 45 per cent would be used for domestic consumption,” T R Parasuraman, senior vice-president (administration, finance and human resources) told Business Standard.

Toyota Kirloskar Auto Parts has about 50 acres adjacent to the Toyota car plant at Bidadi. In the export-oriented first unit here, the company manufactures 1,80,000 units of R-Type transmissions a year. The company’s axle plant, where it manufactures front and rear axles and propeller shafts for the Innova, has a capacity of 75,000 units a year. As a part of the company’s localisation project, the new plant would manufacture engines and expand its export-oriented unit to supply transmissions for the Etios. Production of transmissions for the Etios and Etios Liva models is scheduled to start by early 2013.

A senior company official said the new plant would start producing engines for the Etios and the Etios Liva by end of July or early August.

Two years ago, Toyota Kirloskar Auto Parts had announced the setting up of an engine plant, as well as the expansion of its export-oriented unit for transmissions.

The company serves as a production and supply base for manual transmissions for Toyota’s international multi-purpose vehicle series vehicles to India, Thailand and Argentina.