Toyota reaffirms commitment in Indonesia with MPV project

Japanese carmaker Toyota Motor Company (TMC) launched on Wednesday the fifth generation of the popular Kijang multipurpose van (MPV), the Kijang Innova. The new generation of the Kijang has been developed under Toyota's International Innovative Multipurpose Vehicle (IMV), a global effort worth some US$360 million. The Jakarta Post, Kompas and Bisnis Indonesia talk to TMC senior managing director Akio Toyoda about the company's future plans.

Question: Which countries do you think are the potential markets for Kijang Innova?

Answer:Kijang Innova will of course be sold for the domestic Indonesian market but other than that we have plans to export it to ASEAN and Middle Eastern countries. But I am sorry I cannot give the specific country data right now.

Do you think the Indonesian market will accept the new Kijang generation given that you are also selling Toyota Avanza?

Kijang has been admired for a long time by the local people, but considering the environment and safety features, we thought that there was a limit to what we could do to continue the current Kijang lineage.

At the same time, we were ready to develop a revolutionary car by building a new platform of engine and transmission at an affordable price.

Regarding Toyota Avanza and Daihatsu Xenia, the Kijang customers' profile has been widely diversified, so by producing and providing both under-IMVs (Avanza and Xenia) and Kijang Innova we will be able to satisfy a wide range of customers' needs.

What's your future investment plan for Indonesia after the launching of Toyota Avanza and Kijang Innova?

Actually, we want to focus first on Kijang Innova production at our Karawang plant for the time being. Regarding Toyota Avanza and Daihatsu Xenia, these vehicles are very popular and people are lining up to buy them.

We want to ensure the successful production of both Avanza and Innova while maintaining our high level of quality. Only then, we can think of introducing new models.

How do you maintain quality while meeting such a high demand for the vehicles?

To maintain or even improve the quality, we believe the key is human resources. The philosophy of our company is that manufacturing rests on human resources development.

We have been operating in this country for more than 30 years. We have been able not only to increase the quality and skill level of our workers but also able to increase the capability of the suppliers.

The key is how to motivate the people to have and develop a kaizen (continuous improvement) mentality.

The Japanese business community in Indonesia has been complaining for several years about the condition of infrastructure here. What's your comment about it?

We plan to export some 10,000 Kijang Innova out of our planned annual production of 80,000 units. The presence of a dedicated seaport is important not only for Toyota but for the Indonesian automotive industry to grow further.

Such a facility is a must and therefore we will continue working closely with the Indonesian government to realize it.

What is your comment on the allegation that as far as the car industry is concerned, Indonesia has been left behind other countries in ASEAN especially Thailand, Malaysia and the Philippines?

Indonesia is not much behind those countries. I don't think so. I say this because in 2003, total (Toyota) vehicle sales in Indonesia were among the world's top 10.

We sell our products in so many countries and Indonesia has a very solid local market.

That is why chose Indonesia as the production base for MPV as well as the gasoline-fueled engine.

What kind of partnership do you prefer with component suppliers? Because there are many local suppliers feel that it is difficult to cooperate with Toyota.

We at Toyota apply an open-door policy in selecting suppliers. Of course, we have the responsibility for the quality of a finished vehicle.

We assess the capability of suppliers as well as the cost.

I would like to remind our local suppliers to have a long-term vision as Kijang Innova is designed to have a model life of eight years.