Toyota Motor Corp. and Mazda Motor Corp. has agreed on forming a capital alliance, with a total investment of $1.6 billion for a new manufacturing plant in U.S.
Industry analysts see this move by Toyota and Mazda as a safeguard against increasing industry needs globally to build cars that meet stricter emissions and environmental requirements.
"With the future of the industry in mind, in addition to leveraging their individual strengths to further improve technologies and reinforce their business foundations, Toyota and Mazda aim to deepen collaboration and achieve sustainable growth through their partnership, rising to face and overcome these pressing challenges," Toyota said in a statement.
A joint venture between Toyota and Mazda will be launched in the U.S. market. This cooperation aims to build a large factory by 2021 that can produce up to 300,000 of Mazda’s sport utility vehicles and Toyota’s Corolla models per year, the automakers said.
Mazda will own 0.05% stake in Toyota, a while Toyota will own a 5.05 percent stake in Mazda for ¥50 billion.
"Rather than conflicting with each other, it is essential that we seek partners that can compete and collaborate from a wide point of view, as the industry sees new players like Google, Apple and Amazon emerging from new fields", Toyota President Akio Toyoda said.
According to principal researcher at Mitsubishi Research Institute, Takaaki Sugiura, this partnership will allow Mazda access to Toyota's larger technologies, especially environmental friendly technologies, while Toyota will benefit from Mazda's more stylish designs.
"Mazda has been focused on developing internal combustion and diesel engines. And given its size of sales, it is difficult to invest in research and development (on technologies for environmentally friendly cars) as much as Toyota does," he said. "So, it’s a bonus for Mazda if it can access Toyota’s technologies."
Toyota aims to fully enter the EV market by 2020 and Mazda plans to start selling EVs in the U.S. in 2019.
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