In February, Toyota announced that it was going to absorb the remaining 49% of Daihatsu that it didn’t already own. Toyota has owned 51% of the fourth largest manufacturer in the Japan market (by sales) since 1988, and had an agreement to co-operate way back in 1967. Daihatsu is actually the oldest brand on sale today in Japan and is based in Osaka.
The deal is expected to be finalised by August and comes at a time when Toyota is winding back the Scion brand in the US. Scion was the “fun”, younger brand and I think that Toyota has realised that the brand has too much cross-over with the smaller Toyota branded cars they sell. To me it looks like Toyota will use the fully added Daihatsu brand as an entry level series of cars and light trucks.
One reason I think that Daihatsu will be the entry level brand is that there was a comment that Toyota would introduce it to India over the next 3 – 4 years. India is a fast growing market as more people switch to cars from motorcycles. Suzuki, through its Maruti Suzuki venture has had a strong presence in the market for years, Honda too have a market share and recently Hyundai started to grab a share as well. Toyota has a couple of models specially designed for the India market – the Etios saloon (sedan) and the Liva hatchback however they are not selling well.
India is a great market for manufacturers because buyers are following the trends set in other markets over the last few decades. Younger owners start with an entry level car and then as they get wealthier and start families, they logically move to a larger vehicle and the manufacturers need to retain them with bigger, more luxurious models. Toyota could start buyers with a Daihatsu and then move them through Toyota to Lexus, keeping them as a customer in every stage of an owners life.