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Toyota India, the country’s seventh largest car maker takes pride in attaining the number one position in the manufacturing zero-defect vehicles in the past two years. The car maker has been able to attain this position for the past two years.

The global team of the company conducts a random check of the units manufactured in various plants. This team rated the Toyota’s vehicles made in India as number one for the past three years. The parent company headquartered in Aichi has more than 50 manufacturing plants across the globe and the manufacturing plant in India was rated number one from amongst plants.

The top management is quite “bullish” about the quality of the personnel in the Indian plant. They allege that they need to create the “right environment” for their work force. The deputy managing director of the Indian subsidiary, Shekhar Vishwanathan says that the company has been able to maintain a good relationship with the workers over the past 13 years of its operation in India.

However, the drive to attain this position has not been all that smooth. The company had to face a strike in its Bangalore plant in 2006 and now there are growing concerns about the growing strength of Yen and the other currencies against the India rupee. The main reason behind this concern is that the company has to import various parts like engine and components related to transmission from Japan. This escalated the cost of production and cost about Rs 180 crore more to the company in the last financial year.

The value of rupee against the dollar, yen and many other currencies has gone down. Vishwanathan says that “every Re 1 depreciation against the dollar means a hit of Rs 600 million (Rs 60 crore) hit for Toyota India. In the last fiscal, we witnessed a depreciation of Rs 3; it means we have taken a hit of around Rs 180 crore till now, considering that we are importing certain components.”

So for a company that has to import many parts from Japan, the increase in the value of Yen is definitely a cause of concern. The company also expects that it will increase by 33 percent in the next three years; it will jump from 450 crore to 600 crore. The increase in the cost has to be borne by the customers, who also have to battle with an increase in the interest rates.

The focus of the company is clearly the developing markets like India, Brazil and China. Vishwanathan claims that “For Toyota, the focus is clearly the developing countries. After all, “developed markets including Japan and the US are growing very slowly. So, the growth is flat or negative. For Toyota as a group, India, China and Brazil are very important markets.”

The highest selling product for the company is Innova, and the company plans to double its sales targets in the next two years. It plans to increase the production capacity of plants that manufacture Innova and introduce some variants of the car. It also has high hopes from its recently launched Etios.