FRANKFURT -- Toyota Motor President Katsuaki Watanabe is not completely satisfied with the automaker's low-cost car.

"When I drove the first prototype in late March, I found the level of the new car not bad," Watanabe told Automotive News Europe at the IAA in Frankfurt. "But I asked for more in terms of cost reduction."

Toyota plans to launch its low-cost car in emerging markets such as India, China, Russia and Brazil. But bringing costs down for the car while maintaining the brand's signature reliability and high quality is proving difficult.

Watanabe said that he felt "there was still room for quality improvement."

He declined to provide more details on the low-cost car, which supplier sources say is code-named EFC (Entry Family Cars).

The Japanese press has reported that Toyota is planning a launch by the end of the decade and a price below 800,000 yen (€5,000).

In Frankfurt, Watanabe challenged those reports.

"I do not rule out the possibility of building a car priced under 800,000 yen, but I do not think it will incorporate the safety and quality level Toyota wants to offer," he said.

Developing new low-cost technologies and systems was a top priority for Watanabe when he took over at Toyota two-and-a-half years ago.

Toyota will apply lessons from its low-cost car program across its entire product range as part of Watanabe's goal to reach a 10 percent operating margin in the medium-to-long term.

Toyota's profit was 9.3 percent of revenue in the fiscal year ending March 31.

You may e-mail Luca Ciferri at lciferri@craincom.de