Auto Expo 2018: In conversation with N Raja
Sirish Chandran: The Yaris has been around internationally for some time now, why did it take so long to bring the car in India?
N Raja: We have been fighting to fill in the gap. Things have been going well, action has been done, the petrol segment domination coming in has brought more confidence to the team. Whether we have offered petrol, diesel or hybrid powertrain is a future question, that is one thing which has helped us and the second thing that helped us is the segment volumes and the upgrade from the Etios segment has been one of the strong factors which have pushed up. Like you, my desire was also to get this product three years early. Not only this, we have one-two gaps still which we are working with. Things are changing slowly if I am looking at long-term results. The policy changes by way of Euro 6 in 2020 skipping of Euro 5, pedestrian safety coming up, dual airbags standardization, all these things are still taking time for my parent company to decide on what level we need to address too. There is no time talking something that we launched, we need to work on Euro 6 later. We have to be ready now. The timing is becoming good for Toyota now, because global products all meet and we are talking about global products coming. We also face pricing challenges, with the rising competition, we also have to fulfil all this. If I had to talk about 20-25 percent premium, no customer would have looked at it. But now, all these features coming in, competition also has to catch up.
SC: You were talking about global products, so the experiment with the Etios is over, where you designed the car for India. So, will Toyota now bring only global cars?
R: The platform is going to be global for all the countries. If I look at India today, the challenge for us is that the government is moving towards the European standards, the customer expectation for the product pricing is still Asian. So, we are caught up in this dichotomy probably another three-four years, this will change and people will be ready to move towards the products which meet those norms.
SC: You mentioned hybrids briefly, why don’t you look at it in a way to set a benchmark and owning that headspace. For hybrids, the volumes will be very small but then you are creating that noise in that segment.
R: Hybrids, as a product, like 11 million products sold, practically 30+ models available with hybrids and sold over 55 countries. The EVs are taxed 12 percent and hybrids are 43 percent is not getting a viable equation for a customer to buy it. Today, the Camry hybrid addresses to a group of customers who don’t look at 4-5 lakh as a big variation, they want to show the world that they are environmentally friendly, they are implementing new technology. But, the same feeling on the economic models is still to come in, it’s like giving a product at double the price and then there are no buyers for it. We are looking at some type of stabilization.
SC: If the policy had not changed on the hybrid taxation, would we have been able to see more hybrid vehicles?
R: Definitely! The plan is still there, what happens is, the journey now moves from hybrid, means Camry and down the line. If the policy was more ahead, we could have seen some smaller models also. In Japan, we have an aqua, which is a hatch, a hybrid that is doing better than the Prius in Japan. Opportunities could have opened us to bring in more products. But now at 43 percent, the road we are looking at, becomes very costly for the customer.
SC: Will you offer a diesel engine in the Yaris?
R: We are starting off with the petrol, rightfully so, because we have seen the competition and we clearly see that the petrol segment is a larger segment here, taking the competition percent cent. A diesel powertrain is not sufficient, it has to be with an automatic or a CVT. This is the mismatch with work that is happening. Till now, it’s not clear as to what will be the future.
SC: Why is it called the Yaris and not the Vios?
R: First consideration is the Europe flairness attachment, and Yaris being a successful European model and people have seen it. Then, this side as Vios, the Yaris seems better.
SC: With Toyota in the recent years, styling has taken a big step forward in terms of flair, its not the staid and boring styling of the past. How are customers taking that?
R: The big change was our Corolla Altis. We have lot of positive feedback that has inspired our design team to work in that direction. We always had good vehicles with good work process, only the style used to be boring, we realized that, and hence a lot of changes happened. Our research team really understands what the customers want. Apart from the work culture, the customer also wants an attractive looking car. They are ready to compromise a little bit on performance, as long as the car is looking attractive. That is coming in the DNA slowly.
SC: With the Innova Crysta, the car is offered in both Petrol and in Diesel, do you see a lot of inclination towards Petrol?
R: As a business continuity plan, we have to offer that. We had a big learning here. The customer still looks at the Diesel powertrain.
SC: Now that you have got the Yaris, will you still focus on the Etios and the Liva? What is the plan for that? Is there any more refreshments coming on the cars?
R: Etios and Liva are my feeders for the Yaris. We are also looking fresh customers to come in. We have plenty of capacity, so we cannot afford not focusing on that segment. We have also seen a lot of success in the last year focusing on the personal segment. Standardization of airbags and ABS appeal to the personal segment. For the Etios and Liva, we will continue intermediate actions while simultaneously work towards new ones.
SC: You also have been doing few things with the TRD brand in India, any more activity planned on that?
R: We are looking at taking the currently available TRD platform globally and working on it. We have the TRD platform on the Fortuner which we are using globally, the profile is available for the Vios as well. We will look at it and take benefits from it down the line.
SC: Do you also have any plans for motorsports? Two of your cars were at the Chikamangaluru rally last year.
R: We are at cross roads on the motorsport and how do we build on the Etios race. That’s what I want to sit with you to take more ideas to develop. We are looking at what do we continue at motor racing and thankfully, the MD is more energetic on it, infact he was the one, who was in one of the rally cars. We will develop. Sending drivers for racing in markets like Thailand has limited scope, so how do we build the brand and catch on it is what we will look into.
SC: The Yaris bookings will start in April, when will the deliveries commence?
R: Production will start soon and the deliveries will commence by May-June this year.