Reviewing Indian operations due to diesel ban: Toyota

Japanese automobile major Toyota is “re-looking” at its Indian operations saying orders are passed “against principle of natural justice”.

Although the company, which operates in India as a joint venture — Toyota Kirloskar Motor — with the Kirloskar group, is not considering shutting shop here, but at the same time it is also not looking at launching new models here.

“We’ve already started re-looking at our operations. What is hurting us is not so much the ban but the unfairness. Orders are passed without hearing us. It is going against the principles of natural justice. We feel our vehicles are being targeted,” Toyota Kirloskar Motor Vice-Chairman and Whole-time Director Shekar Viswanathan. He was reacting to the direction by National Green Tribunal Circuit Bench in Kochi on Monday to Kerala government not to register any diesel vehicle with engine capacity of 2000cc and more, except public transport and local authority vehicles.

The green bench had also banned light and heavy diesel vehicles, more than 10 years old, in six major cities, including Thiruvananthapuram and Kochi. Toyota is among the auto makers worst hit the ban imposed by the Supreme Court on registration of diesel cars and sports utility vehicles with engines above 2,000cc in Delhi and National Capital Region last December.

"We can understand if they banned all diesel vehicles but why only 2,000 cc and above?" Viswanathan said.

When asked if the company will consider closing operations in India, he said: "There are about 25,000 people whose jobs are directly or indirectly linked to our operations. We are not going to abandon them." While he did not elaborate what "re-looking" at Indian operations would entail, Viswanathan said post the diesel ban issue, Toyota headquarter is questioning the rationale for making investments to launch new models in India.

"We will have to sell only those models which we are allowed to sell in India. The newly launched Innova Crysta is doing very well for us," he said, however, adding the company has to miss out on Delhi-NCR and Kerala, which are among its bigger markets in India.

Viswanathan had earlier termed continued restrictions on vehicles that comply with all regulations as "worst advertisement of India" referring to the ban on big diesel cars and SUVs in Delhi-NCR.

Last week, Luxury car maker Mercedes-Benz had said it has put on hold investments in India due to ban on sale of larger diesel vehicles in Delhi-NCR and the issue has put a question mark on the country's credibility as an investment destination.