Toyota Kirloskar Motor Pvt Ltd (TKM) announced that it will invest about Rs 1,400 crore ($350 million) to build its second plant near its existing facility near Bangalore for manufacturing a small car. The second plant will be used to manufacture passenger vehicles, including the Corolla as well as a new strategic small car, which is being developed with the aim of meeting the broad needs of customers in India, where motorisation is expanding rapidly.

The small car will have high local procurement content which will enable the company to price the car competitively. The company also plans to increase the dealerships and widen its sales and service network as small car will mean larger volumes. The current capacity of the existing plant at Bidadi which is 40 kms from Bangalore is about 63,000 units. During 2007, the joint venture in which Toyota Motor Corporation has 89 per cent and the rest is with the Kirloskar Group, sold around 54,000 units. Toyota Kirloskar Motor has around 2,800 employees currently.

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