Toyota, the world’s biggest automaker, will enter the minicar market. The company plans to expand its product line to include mini vehicles made by subsidiary Daihatsu Motors starting in stages from autumn 2011 in Japan. There are no plans for any similar venture for the American market at this time.
Mini vehicles are defined by specifications unique to Japan: maximum length of 11.15 feet, width of 4.86 feet, height of 6.56 feet and engine displacement of less than 660 cc.
The minimarket has been expanding in Japan and under the agreement, Daihatsu will produce three models for Toyota, which will sell them through its dealerships. The companies said they expect annual sales of about 60,000 mini vehicles once all three models hit showrooms.
Such deals are called an OEM, or “original equipment manufacture,” agreement in the auto industry. That means one automaker — Daihatsu in this case — supplies products to another company to sell under its own brand.
The category is popular in Japan for its money-saving potential, including lower fuel costs and taxes. They currently comprise about a third of Japan’s annual vehicle sales.
Automakers have sold 1.22 million mini vehicles in Japan this year through August, a rise of about 8%, according to the Japan Mini Vehicles Association. Daihatsu, 51% owned by Toyota, holds top share of Japan’s competitive mini vehicle market.