Japanese carmakers Toyota Motor Corporation and Mazda Motor Corporation have inked several joint venture agreement aimed at creating new types of value for future mobility and achieving further sustainable growth. The deal will help both entities to enter a business and form capital alliance.
The agreement signed on August 4 is a result of two years of discussions between the two companies. Specifically, the companies agreed to establish a joint venture that produces vehicles in the United States, jointly develop technologies for electric vehicles, jointly develop connected-car technology, collaborate on advanced safety technologies and expand complementary products.
In addition, together with the aim of advancing and strengthening their long-term collaboration, Toyota and Mazda agreed to a capital alliance arrangement that preserves independence and equality for both companies. In the capital tie-up, the two companies have agreed that Toyota will subscribe for and acquire shares to be newly issued by Mazda through a third-party allotment, and at the same time Mazda will subscribe for and acquire third-party allocation shares of treasury stock disposed of by Toyota in the equivalent amount in value to the Mazda shares. The value of the shares mutually acquired by both companies will be equivalent.
Toyota President Akio Toyoda said: “The greatest fruit of our partnership with Mazda is that we have found a new partner who truly loves cars. It has also sparked Toyota’s competitive spirit, increasing our sense of not wanting to be bested by Mazda. This is a partnership in which those who are passionate about cars will work together to make ever-better cars. It is also the realization of our desire to never let cars become commodities.”
Mazda, President and CEO Masamichi Kogai said: “Nothing would please me more than if, through this alliance, we can help to energize the auto industry and create more car fans by bringing together two competitive spirits to spur each other on, leading to innovations and fostering talent and leaders.”
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The global auto industry increasingly faces great challenges, including stricter environmental and safety regulations for new vehicles and the entrance of competitors from other industries, as well as the diversification of mobility-related businesses. Toyota and Mazda partnership will leverage each other’s strengths and overcome these pressing challenges.