Toyota signs MoU with K’taka for ₹4,800 crore investment in green tech

Japanese automaker Toyota Group — which consists of Toyota Kirloskar Motor and Toyota Kirloskar Auto Parts — has announced a Memorandum of Understanding (MOU) with the government of Karnataka. Out of a total investment outlay of ₹4,800 crore, Toyota will invest ₹4,100 crore. The MOU espouses to contribute to the country’s vision of “Make in India” and to enable a faster reduction in carbon emissions.

This MOU was exchanged between Karnataka chief minister Basavaraj Bommai and Vikram S Kirloskar, vice-chairman, Toyota Kirloskar Motor, in the presence of Murugesh R Nirani, the minister of large & medium industries, Karnataka, among others.

The investments are aimed at promoting greener technologies that will help lower dependence on fossil fuels and mitigate carbon emissions. This investment will also enable local production facilities to build electric powertrain parts and components, thereby catering to the electrified vehicle manufacturing in India. The investments are in line with the Toyota Environmental Challenge 2050 — to become carbon neutral by 2050 — and the company claims to go beyond tailpipe emissions to address manufacturing and lifecycle CO2 emissions.

“The MoU with the Toyota Group of Companies is a huge stride in making Karnataka a global supply-chain and manufacturing hub, and the Karnataka government is confident of Toyota’s commitment towards sustainable growth and local manufacturing quality for Karnataka’s growth and development. Karnataka being the hub of electric vehicles, welcomes this MoU which adds another feather to State’s cap as leader in this sector,” Bommai has said on the occasion.

Nirani adds the investments will also enhance the local supplier growth in Karnataka, further leading to higher investments and more job creation. “Besides boosting the local manufacturing sector, these investments will also support local community development,” he says.

This investment will also enable local production facilities to build electric powertrain parts and components, thereby catering to the electrified vehicle manufacturing in India. In addition to boosting the local manufacturing eco-system, the investment will provide an impetus to employment generation and local community development. This investment is touted to spur the growth of the local supplier base, and hence, according to the company, result in higher investments and further job creation.

According to Kirloskar, the MOU is an important milestone in terms of ushering in large-scale investment to make deeper cuts in carbon emissions, higher employment generation, creating local manufacturing hubs not only for domestic needs but also for global markets, local community development and advancement in innovation. “As a part of our philosophy, we always conduct deeper studies, analyse and explore multiple technological pathways that are best suited to optimally achieve the national goals on lowering dependence on fossil fuels, make India truly self-reliant, reducing carbon emissions and creating jobs,” he explains.

The Toyota Group in India has so far invested ₹11,812 crores and employs more than 8,000 people. According to the company, it spent 40,000 man-hours every year to enhance processes through system, management, training, and hardware development. Further, it has spent another 8,500 man-hours every year on suppliers’ people development. Toyota sold 12,719 vehicles in India in April this year, cornering a 4.8% market share.