To jointly address the challenges during this transition period, the two companies plan to build and promote a long-term partnership between the two companies to foster collaboration in new areas, including autonomous driving. Toyota Motor Corporation (“Toyota”) and Suzuki Motor Corporation (“Suzuki”) hereby announce that the two companies have today entered into a capital alliance agreement (the “Alliance”) to establish and promote a long-term partnership between the two companies to promote collaboration in new areas, including autonomous driving. All of this sounds like good news for Suzuki, but what does Toyota have to gain from this partnership? Automotive News explains Toyota`s interest in Suzuki in one word: India. Suzuki President Osamu Suzuki said, “When we announced our scope of cooperation in May last year, I said we would strive to succeed around the world. Since then, I have seen progress in the partnership and it is a pleasure for me to be able to make this announcement today regarding the status of the partnership globally, including in Europe and Africa. In addition, we appreciate Toyota`s friendly offer to be able to use our hybrid technology. We will continue our efforts. Toyota President Akio Toyoda said: “When it comes to vehicle electrification, which is expected to continue to advance, hybrid technologies are seen as an important role in many markets, as they have been in the past. For electrified vehicles to contribute to the Earth`s environment, broad acceptance is needed. With our new agreement, we look forward to wider use of hybrid technologies, not only in India and Europe, but around the world. At the same time, we believe that expanding our business partnership with Suzuki – from the mutual delivery of vehicles and powertrains to development and production – will help us gain the competitive advantage we need to survive this century of profound transformation.
We want to strengthen the competitiveness of our two companies by using our strengths and learning from each other. The conclusion of the capital alliance agreement is a confirmation and expression of the outcome of sincere and thorough discussions between the two companies and will serve to build and promote their future partnership in new areas. Toyota hopes to learn from Suzuki how to design and build low-cost vehicles for emerging markets like India. Toyota has also increased its size by adding alliances with Daihatsu, Mazda, Subaru and now Suzuki. It remains to be seen how this partnership will affect Toyota and Suzuki`s product lines, but it seems unlikely that any of these vehicles will be sold in the U.S. market. We are sorry for those who hope that Toyota could import a Suzuki Jimny with a new emblem into the United States – this agreement is aimed exclusively at India. In February 2017, Toyota and Suzuki agreed to begin “hands-on testing” of a technology and procurement partnership.
A year later, they agreed to sell hybrid cars and other vehicles to india. In March of this year, Toyota further expanded the alliance to supply its hybrid system to Suzuki worldwide, while Suzuki will sell compact vehicles through Toyota in India and Africa. The automakers also said they plan to jointly produce electric cars in India in 2020. Toyota recently announced a partnership with Japanese automaker Suzuki. Other companies like General Motors and Volkswagen have partnered with Suzuki in the past, but now it`s Toyota`s turn to benefit from a link with Japan`s fourth-largest automaker. The deal will involve Toyota buying a small stake in Suzuki and Suzuki doing the same with Toyota. Toyota says the partnership will focus on “promoting collaboration in new areas, including autonomous driving,” and will include building Suzuki vehicles based on the RAV4 Hybrid and Corolla. In order to develop and promote a long-term partnership between the two companies, the companies plan to acquire shares of each other on the basis of the alliance. Suzuki`s subsidiary, Maruti Suzuki India, managed to capture a massive market share of 46% in India. The next competitor, Hyundai Motor India, posted a meagre 16%. Toyota is far behind with a market share of less than 5%, but the company hopes its partnership with Suzuki can change its destiny.
Even before the deal was announced, Toyota and Suzuki were in talks to work together in the Indian market. Toyota and Suzuki have been reviewing the concrete details of such a collaboration since they signed a letter of intent on the business partnership on February 6, 2017. Akio Toyoda, CEO of Toyota, said: “We believe that expanding our business partnership with Suzuki – from the mutual supply of vehicles and powertrains to development and production – will give us the competitive edge we need to survive this century of profound transformation.” The two Japanese companies signed a memorandum of understanding to develop a partnership in 2017 and have now agreed on the “concrete details” of the agreement. The two companies say the deal will bring together “Toyota`s strength in electrification technologies and Suzuki`s strength in compact vehicle technologies.” .