ArrowArtboardCreated with Sketch.Title ChevronTitle ChevronEye IconIcon FacebookIcon LinkedinIcon Mail ContactPath LayerIcon MailMenu BurgerPositive ArrowIcon PrintIcon SearchSite TitleTitle ChevronIcon Twitter
Toyota Motor President Akio Toyoda, left, stands with Suzuki Motor Chairman Osamu Suzuki.
Business

Toyota near tie-up with Suzuki on development, procurement

Leading Japanese automaker expands alliances targeting IT, self-driving

NAGOYA, Japan -- Toyota Motor and Suzuki Motor are near an agreement on a comprehensive partnership covering areas such as development and procurement, it was learned Friday.

The two Japanese automakers could announce a deal as soon as Monday, setting specific points of cooperation later. On the development side, these are expected to include self-driving technology and applications for information technology, as well as advancements needed to keep up with increasingly strong global environmental standards. Partnering on procurement could involve sharing sources for parts in Japan and abroad.

Toyota has deemed it necessary to bolster cooperation with other automakers in order to maintain its influence as nontraditional players such as tech companies stoke competition in the auto sector. Suzuki has sought a powerful partner since dissolving a capital and business tie-up with Germany's Volkswagen in 2015. Suzuki Chairman Osamu Suzuki last year approached Shoichiro Toyoda, Toyota's honorary chairman, regarding collaboration.

Suzuki and Toyota unit Daihatsu Motor, which together control more than 60% of Japan's market for minivehicles known as kei cars, will continue to sell automobiles under their separate brands to avoid falling foul of antitrust laws. But the two will collaborate in ways that steer clear of that risk, starting with a loose partnership on matters such as technological development.

A capital tie-up, including cross-shareholdings, will be discussed in the future to deepen ties between the groups.

Useful friends

Toyota has cast a wide net in the auto sector, striking capital and business partnerships with peers such as Subaru maker Fuji Heavy Industries and Isuzu Motors in the mid-2000s, as well as with Mazda Motor and Germany's BMW more recently. This aims to let Toyota shape industry standards for IT and self-driving technology to its advantage. The Suzuki deal would raise the number of autos Toyota and its allies make each year to at least 18 million.

In January, Toyota teamed with Ford Motor of the U.S. to launch the SmartDeviceLink Consortium promoting technology to integrate devices such as smartphones with vehicles. Fuji Heavy, Mazda and Suzuki have signed on as well. Toyota and its partners are also exploring collaboration on automotive operating systems.

Alliances in emerging nations are less developed. Though Suzuki commands a hefty share of the growing Indian auto market, for example, its soon-to-be partner has failed to make as much of a mark there as in countries such as Japan and the U.S. The Toyota group has turned Daihatsu, a full subsidiary since 2016, into a core unit for small cars in emerging markets. Working with Suzuki on parts procurement and the production of certain models is expected to build the Japanese auto giant's presence there further.

(Nikkei)

Sponsored Content

About Sponsored Content This content was commissioned by Nikkei's Global Business Bureau.

You have {{numberArticlesLeft}} free article{{numberArticlesLeft-plural}} left this monthThis is your last free article this month

Stay ahead with our exclusives on Asia;
the most dynamic market in the world.

Stay ahead with our exclusives on Asia

Get trusted insights from experts within Asia itself.

Get trusted insights from experts
within Asia itself.

Get Unlimited access

You have {{numberArticlesLeft}} free article{{numberArticlesLeft-plural}} left this month

This is your last free article this month

Stay ahead with our exclusives on Asia; the most
dynamic market in the world
.

Get trusted insights from experts
within Asia itself.

Try 3 months for $9

Offer ends January 31st

Your trial period has expired

You need a subscription to...

  • Read all stories with unlimited access
  • Use our mobile and tablet apps
See all offers and subscribe

Your full access to the Nikkei Asian Review has expired

You need a subscription to:

  • Read all stories with unlimited access
  • Use our mobile and tablet apps
See all offers
NAR on print phone, device, and tablet media