Page 144 - DMGT206_PRODUCTION_AND_OPERATIONS_MANAGEMENT

Unit 7: Efficiency and Effectiveness

Notes
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Caselet Toyota Kirloskar Looking at Higher Level of Automation

— by K Giriprakash
Toyota-Kirloskar may increase the automation in its second plant because of its higher
capacity and hence may need fewer workers to run the operations.

The existing plant at Bidadi, 40 km from Bangalore, has the capacity to manufacture 60,000
vehicles and is one of the least automated plants of the world’s largest car maker, Toyota
Motor Corporation. The new plant, which will also come up near the existing plant, will
manufacture the mass market compact cars and will have a capacity of one lakh units.
Higher Automation
Toyota Kirloskar Motor’s Deputy Managing Director (Commercial), Mr Shekar
Viswanathan, told Business Line that with the company looking to turn out more cars
from the second plant, the auto major was studying the feasibility of automating the plant
to a level higher than at the existing plant. “Given the higher volume that the new factory
will have, plans to have a higher level of automation in the new factory is under study,”
Mr Viswanathan said. However, if the cost of automating the new plant is much higher,
the company might look at a slightly lower level of automation and hire more workers.
Mr Viswanathan said the company is using the downturn in the auto sector to multi-skill
its workers. It is reducing the assembly line speed so that the same number of workers
carries out multiple tasks and learns more about taking advantage of the reduction in
production because of the slowdown in the automobile market.

Toyota has slowed down production at its plant considerably and expects the plant will
return to full capacity in a couple of months. Mr Viswanathan said kaizen (continuous
improvement) was an effective process - both during the downturn as well as when the
plant is running at full capacity. He said during the downturn, workers will have the
opportunity to increase their skill sets and will hence be armed to carry out a variety of
tasks.
Revival in H2
Toyota Kirloskar Motor (TKM) has said the automobile sector in India is expected to
revive by the second half of this calendar year.
The TKM Managing Director, Mr Hiroshi Nakagawa, said the recession had not affected
India as it has in other parts of the world. He said the compact car project is on schedule,
though it was too early to talk about its pricing.

Mr Nakagawa, speaking on the sidelines of the 18th International Engineering and
Technology Fair here, said that Toyota had taken into consideration the fact that when the
compact car is launched during 2010, several other car makers too have lined up similar
car launches around then. “There will be enough competition by the time we launch our
own car. But we expect to have our own niche in the segment,” he said.
He said once Toyota starts selling more of these compact cars, it will start work on exporting
these cars, though the countries to which these cars will be exported have not been short-
listed. The company’s Vice-Chairman, Mr Vikram Kirloskar, said one of the reasons for

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