Toyota Kirloskar Motor (TKM) on Tuesday announced that it would produce engines and gearboxes for Toyota Etios at its second plant here with an initial capacity of 70,000 units.

Vice Chairman TKM Vikram Kirloskar said the production of Etios, the small car that’s being developed exclusively for the Indian market and showcased early this year at the Delhi Auto Expo, is scheduled by end of December 2010.

TKM subsidiary Toyota Kirloskar Auto Parts (TKAP) has two plants with a total investment of Rs 500 crore. One of them produces 52,000 engines per annum for the domestic market while the second plant, with a production capacity of 170,000 gearboxes, partly provides for the Innova and the rest is exported to Thailand and Argentina, he said.

TKAP would invest an additional Rs 500 crore, part of which would go towards increasing the number of transmission boxes to approximately 240,000 per year and in setting up a third plant with a capacity of 100,000 engines per year, of which 70,000 would be for the Etios and the balance for exports, he said, adding the third plant would employ 500 people.

The 100,000 engines will be produced from the start of the third quarter of 2012 and around 240,000 transmission boxes at its third plant starting early 2013.

TKAP currently produces manual transmissions for the Fortuner manfactured in India, Thailand and Argentina. It also produces axles and propeller shafts for the Innova manufactured in India. Production of engines and gear boxes for the Etios will further localise production.

TKM set up its first plant with an investment of Rs 1,700 crore. The second plant involving an investment of Rs 3,200 crore is the one which will manfacture Etios.

Nakagawa, Managing Director, TKM said the company sold 55,000 vehicles last year and was looking at sales of 70,000 vehicles this year. “We are looking at a 20 per cent growth and expect the sales target to double to 140,000 vehicles by 2011 (of which the Etios will be contributing half)”, he said.

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