Toyota Kirloskar Motor, the Indian joint venture of Japanese auto major Toyota Motors, is planning to set up an engine and transmission plant in India as it steps up use of indigenous car parts and spares.
Toyota Kirloskar Motor is likely to set up the new plant at its upcoming second factory in Bangalore, the company's managing director Hiroshi Nakagawa said.
"In order to localise production, in future I am very keen to set up a transmission and engine unit in the second plant," Nakagawa said on the sidelines of a conference on environment-friendly vehicles in New Delhi.
He said the new facility would have in an initial production capacity of 70,000 units a year, which can be scaled up to 2,00,000 units as and when market expands.
"The initial production will be 70,000 units and, depending on demand, we will ramp it up to 200,000 units," Nakagawa said, adding that the company plans to invest around Rs3,200 in the new facility.
Toyota expects to launch its small car in India by early 2011.
Speaking at the Commonwealth Club of California, the first and biggest public affairs forum in the United States, earlier this month, Jim Lentz, president of Toyota Motor Sales, in the US, said he expects San Francisco to be the "hybrid car capital of the world."
And more hybrids are sold here than anywhere else.
Toyota operates 14 manufacturing plants in North America, a design studio in California, a state-of-the-art test track in Arizona and an R &D center in Michigan, which it recently expanded to accommodate 1,000 engineers.
Toyota has bulk of its US investments in California, with sales and production facilities up and down the state.
A recent report by Booz & Company notes that when per capita income rises in developing countries, rates of car ownership increase, thus improving personal income and stimulating further economic development.
Toyota expects Brazil, Russia, India and China may soon have company as countries like Argentina, Indonesia, Mexico, Thailand and Turkey are also on the for much greater car ownership.