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The India subsidiaries of a Toyota Motor Corp and Suzuki Motor Corp is supplying specific models including hybrids to each other which is on the fundamental agreement of a mutual supply, the two companies say in a joint statement on Thursday.
The vehicles will sell through the sales network of the Maruti Suzuki in India and Toyota Kirloskar Motor. With the move, the companies are aiming to further to strengthen their position in a market that is touting to be the third largest globally in the year 2020.
By challenging and competing for each other with the goal of mutual improvement, Toyota, and Suzuki aiming to invigorate the Indian automotive market to further enhance their respective products and services to offering to the customers,” the companies say.
As a part of the agreement, Suzuki will supply the Baleno and Vitara Brezza models to Toyota, but Toyota will provide the Corolla to the Suzuki. The Details on each model, such as the schedule of the start of a supply, number of the supplied units, vehicle specifications, and supply pricing, is considering at a later stage, the companies say.
According to the Japanese news agency, Nikkei, Maruti Suzuki is supplying Toyota with 30,000 to 50,000 units annually of its compact Baleno and Vitara sport utility vehicles while Toyota will provide Suzuki with around 10,000 units yearly of its Corolla in both the hybrid and gasoline models. This mutual supply of cars will operate on original equipment on the manufacturing basis.
For the models above, the two companies are stepping up the efforts to procure components locally. Toyota and Suzuki say they “remain committing to the widespread acceptance and use of the less fuel-consuming vehicles to help India to reduce its environmental footprint and to enhance energy security.”
But Suzuki Motor accounts for one in every two passenger vehicles selling in India, Toyota with a market share of 3.5 percent has a marginal player and is only present in the premium end of the market. To be sure, an intensifying competition, stricter regulations and an emphasis on the green technologies through the Indian government are prompting global auto firms to collaborate and to share the costs.
Since in the year February 6th, 2017, when Toyota and Suzuki are concluding a memorandum towards the business partnership, the two companies have explored a concrete project for collaboration in the areas including environmental technology, safety technology, information technology, and the mutual supply of the products and components.
In the year November 2017, the announcement of a memorandum of understanding between Toyota and Suzuki to considering a cooperative structure for introducing battery electric vehicles in the Indian market in around 2020 is one result of the joint exploration into the partnership.
Today’s announcement is another outcome and underscores the progress Toyota and Suzuki have together is making, and it is aiming to bolster both the companies’ product line-ups and encouraging competition in the Indian automotive market. The two companies, the statement adding, will continue to explore the other collaborative projects “that will contribute to the attainment of a sustainable mobile society in a manner that it ensures fair and free competition,” the statement says.
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