Do you fancy a Toyota Baleno or a Suzuki Corolla? Well, that just might happen as Toyota and Suzuki have agreed to the mutual supply of hybrid and other vehicles for the Indian market.
Under the agreement, Suzuki will supply the Baleno and Vitara Brezza models to Toyota, while Toyota will supply the Corolla model to Suzuki. What’s going to come of that is unclear at this stage as the details are yet to be worked out. It’s most likely that these three cars will emerge as ‘badge-engineered’ products from the two companies.
Badge engineering is the practice of renaming a car model and selling it, instead of completely rebuilding it. The Nissan Sunny and Renault Scala, Nissan Terrano and Renault Duster, Nissan Micra and Renault Pulse are some examples of badge engineered products in India.
Since 6 February 2017, when Toyota and Suzuki signed a memorandum, the two companies have been exploring projects for collaboration in areas including environmental technology, safety technology, information technology, and the mutual supply of products and components. The November 2017 announcement of a memorandum of understanding between Toyota and Suzuki to consider a cooperative structure for introducing battery electric vehicles in the Indian market in 2020 was one outcome of the joint exploration into the partnership.
The electric vehicles from both companies are likely to be different grounds up models.
This agreement, however, will plug the gaps in the market that both the companies have. Maruti Suzuki does not have a sedan above the Ciaz in India, and getting access to the Corolla will allow the company to compete with the Hyundai Elantra, Skoda Octavia and upcoming Honda Civic in the Rs 16 lakh to Rs 22 lakh price segment. Maruti’s version of the car will obviously also compete with the existing Toyota Corolla Altis as well.
Similarly, Toyota does not have a compact SUV or a premium hatchback to offer. It does sell the Toyota Etios Liva, but will be looking at a more premium offering. There is no compact SUV in Toyota’s line up, which the Vitara Brezza could fill.
For customers though, this would mean more choice, easier access to parts and service. Yes, it will also lead to some identity crisis as well – as has been the case with badge engineered products in the past.