Bargain-Priced Cars Not in Toyota's Future Plan

Nissan’s announcement to revive the Datsun nameplate has definitely caught the attention of rival Toyota, and many are wondering if the automaker will follow Nissan’s lead.

Toyoda recently told reporters in Tokyo that his company will not be following Nissan’s lead, according to Automotive News. Indian automaker Tata made headlines years ago when it unveiled the Nano, the world’s cheapest car. By offering budget-priced cars, Toyota could boost sales numbers, but also faces the risk of tarnishing the brand’s image of building high-quality cars.

"We are a full-line carmaker," Toyoda told the reporters in Tokyo. "But to grow sustainably, we need to make a certain level of profit on cars, no matter how big or small they are. Does Toyota have the ability to make cars for 500,000 yen ($6,000) like Tata Motors? I don't think so. When we think about what customers value in our cars, it's reliability.”

Nissan hopes to avoid cheapening the brand by reviving the Datsun nameplate, which is scheduled to debut in India, Indonesia, and Russia in a few years. Nissan CEO Carlos Ghosn announced earlier this week that production of Datsun vehicles would take place at factories in Indonesia. Those factories are set to receive about $395 million for improvements. It’s still unknown if the vehicle will be an all-new model or a decontented version of an existing Nissan car.

Toyota already sells the Etios hatchback and sedan in India. The cheapest Etios retails at 400,000 rupees ($7800), which is cheap, but still not as low in price as the Tata Nano or the Maruti Suzuki, another popular budget car in India.

Source: Automotive News (Subscription required)

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