* Won't follow Tata, Datsun into low-priced cars-Toyoda
* Need certain level of profits to grow sustainably
* Toyota to target mid- to upper-class in emerging markets
* Not interested in global sales crown for volume's sake
By Chang-Ran Kim
TOKYO, March 22 Toyota Motor has no
intention of offering ultra-cheap cars to boost sales in
emerging markets and will keep its focus on customers who expect
a certain level of reliability, the company's president, Akio
Toyoda, said on Thursday.
Toyoda's comments come days after rival Nissan Motor
announced the revival of the Datsun brand to target
buyers in the lowest and sizeable end of developing markets,
while a German magazine reported Volkswagen was also
planning a similar move.
"We are a full-line car maker," Toyoda told a small group of
reporters in Tokyo.
"But to grow sustainably, we need to make a certain level of
profit on cars, no matter how big or small they are. Does Toyota
have the ability to make cars for 500,000 yen ($6,000) like Tata
Motors? I don't think so," he said, referring to the
Indian automaker famed for developing the world's cheapest car,
the Nano, whose sales have fallen short of targets.
"When we think about what customers value in our cars, it's
reliability," Toyoda said, adding that was evident in the
popularity of used Toyota cars in many Asian countries.
"We won't risk sacrificing quality simply to meet a certain
As demand becomes saturated in the developed world, global
automakers are eyeing low-cost cars to drive sales growth,
especially among first-time buyers moving up from motorcycles
and used cars in emerging markets such as Brazil, Russia, India
Toyota has taken small steps to target that base, starting
with the made-for-India Etios model. But analysts have said the
starting price, of just under 400,000 rupees ($7,800) for the
lowest-grade hatchback version, was still too high to challenge
cut-price stalwarts such as Maruti Suzuki.
BEING "NUMBER ONE"
Nissan, meanwhile, is counting on Datsun to tap a price
range uncharted by global automakers as it aims to join Toyota,
General Motors and Volkswagen at the top of the sales
charts with French partner Renault.
In contrast, Toyoda said he wanted Toyota to put its energy
into developing products for the middle- to upper-class where
its strengths lie, even if that meant playing in only a fraction
of big, emerging markets.
"China has 1.4 billion people, but we don't have to target
all 1.4 billion," he said. "We'll target perhaps 200 or 300
million of that - but that's about the size of the whole U.S.
market. It's huge."
While GM and Volkswagen fight it out for sales dominance in
China and the rest of the world, Toyoda said he wanted Toyota to
strive for industry leadership in other ways, much like GM did
by developing the industry as the biggest car maker over more
than 70 years.
"Until we overtook them (in 2008), GM was number one,
uninterrupted since the 1930s. During that time, it helped the
industry develop and created a culture of cars. That's the kind
of company that deserves to be the industry leader," he said.
"Going forward, I think there will be a lot of shuffling
around among the top five or seven. But for the crown to really
mean anything, I don't want to use it as a motivational tool,"
he said, repeating his warning that unchecked sales growth had
played a role in Toyota's quality crisis a few years ago.
Toyota fell to third place in global vehicles sales behind
GM and Volkswagen last year, hit by the disruption that followed
the earthquake and tsunami disaster.