Why Toyota is rebadging Maruti Suzuki cars in India?

Toyota is a global automaker headquartered in Japan. Toyota has no shortage of ideas, models, or options to launch in the markets in which it operates. However, Toyota has been hesitant to launch any new models in India in recent years. Instead, Toyota Bharath (Toyota India) is rebadging every Maruti Suzuki vehicle and relaunching it under the Toyota brand.

baleno 2022

Baleno was rebadged as Glanza, to begin with, even Toyota has recently introduced its new Glanza, just a few weeks after the new Maruti Suzuki Baleno. The new Toyota Glanza has priced between Rs 6.39 lakh and Rs 9.69 lakh, while the Baleno is priced between Rs 6.35 lakh and Rs 9.49 lakh.

Then Vitara Brezza was transformed into Urban Cruiser, So what were the reasons behind this transformation:

toyota glaza 2022

1. Government’s policies: The government frequently changed rules and regulations, making new investments risky. Toyota was probably forced to wait and watch as BS4, then BS6, sub 4 meter tax exemption, petrol-diesel price difference vanished, safety guidelines and such frequently changing rules. While management decides what to do next, a rebadged car would keep the sales team busy, the showrooms occupied, and some cash flow coming in.

2. Sluggish automotive sales: Due to job losses, demonetization, and other factors, India’s auto industry experienced a massive drop in sales in 2018-2019, and also during Covid in 2021. As a result, Toyota may have been hesitant to make new investments.

3. Brands leaving India: GM left India, Ford was talking about handing over the controls to Mahindra and quitting India. Maybe Toyota was not very optimistic, though their Innova and Fortuner were doing very well.

toyota ciaz

Renault and Nissan have done a lot of rebadging and had a lot of success. However, the Maruti-Toyota alliance has some fundamental flaws. Now there are talks of rebadging the Ciaz and Belta, and even the WagonR, which appears to be a bad move for many people because the Toyota badge was meant for reliability and safety, whereas Maruti was focused on cost-cutting and fuel economy.

toyota innova engine

Despite the fact that Maruti is the most popular car in India, many Indians avoid it due to poor safety ratings. The majority of Maruti’s volume consists of low-priced vehicles. Hyundai makes more money from one Creta than Maruti does from five or six Altos. Toyota’s decision to abandon its own models in favour of simply rebadging every Maruti vehicle isn’t sitting well with people who used to trust Toyota.

Toyota has various models in the global market which they would have launched in India

1. Avanza: Avanza is an MPV, could have been positioned below Innova. Innova now costs 22-25 lakhs, so beyond many people’s affordability. Avanza if positioned in the 10-14 lakh price range it could have given good competition to Ertiga and Marazzo. But instead of bringing Avanza to India, Toyota is simply rebadging Ertiga.

2. Raize: Raize is a compact SUV that could have been pitched against Venue, Brezza, Nexon.

3. Hilux: Hilux is a pickup version of Fortuner, and most probably it will be going to launch in India anytime soon.

4. Electric cars: Indians are opening up to electric cars. Toyota should start with a few models in this department. Toyota had launched Prius in India as CBU so it didn’t find many takers. Given the success of Nexon EV and other EVs, Toyota can give it a try with few electric vehicles. But maybe they want to try with WagonR rebadged EV.

5. Hydrogen car: Toyota Mirai is a hydrogen fuel cell vehicle (FCV), which is available in the international market since 2014, But Union Road Transport Minister Nitin Gadkari has launched the pilot project for the Mirai hydrogen-based Car, in India.

Before launching a vehicle in India, automakers must have an idea of expected sales volume. In countries such as Sri Lanka, they can simply import and sell, but in India, the high tax on CBU makes it unprofitable. As a result, having to plan the entire assembly lineup and investments entails some risk-taking. However, with a well-established dealership network, brand identity, and customer base, we’ll see how long it lasts. What are your thoughts on this? Would you buy a Maruti mode just because it was branded Toyota?

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