Toyota and Mazda enter business and capital alliance

Signed agreement marks start of concrete collaboration aimed at creating new types of value for future mobility and achieving further sustainable growth

Toyota Motor Corporation and Mazda Motor Corporation signed an agreement to enter a business and capital alliance, with the aim of further strengthening their partnership.

Agreement is a testament to the positive result of two years of collaborative and deliberate discussions between the two companies, and it is a milestone in the journey to further strengthen and accelerate the partnership in a sustainable way.

Specifically, the companies agreed to:

1) establish a joint venture that produces vehicles in the United States

2) jointly develop technologies for electric vehicles

3) jointly develop connected-car technology

4) collaborate on advanced safety technologies and expand complementary products

The 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. 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.

Over the medium- to long-term, the two companies will build a favorable relationship that respects the autonomy and equality of each party and works toward success with the agreed joint projects. With the aim of creating new types of value for future mobility, they will accelerate and enhance bilateral cooperation as long-term partners and contribute to the development of a sustainable society by exceeding customers’ expectations.

Details of the agreement on business alliance

1) Establish a joint venture that produces vehicles in the U.S.

As part of the new alliance, Toyota and Mazda have agreed to explore establishing a joint venture plant in the U.S. with equal funding contributions. The plant would have an estimated annual production capacity of approximately 300,000 units. Pending approvals and authorization by relevant government agencies, the companies will begin to examine detailed plans with the goal to starting operations of the new plant in 2021. The plant will require a total investment of approximately 1.6 billion U.S. dollars, and will create up to 4,000 jobs. In addition to the collaboration in product and technology areas that the companies have enjoyed thus far, Toyota and Mazda intend to improve competitiveness in manufacturing through this new production collaboration.

At the new plant, Mazda expects to produce cross-over models that Mazda will newly introduce to the North American market, and Toyota plans to produce the Corolla for the North American market.

By producing vehicles in the U.S., Mazda aims to build a production structure to further grow in North America. These activities will allow the company to more quickly respond to its customers’ needs depending on the region and model.

By further increasing its production capacity in the U.S., Toyota is to further pursue management that is closer to the region, as a measure to improve its response to the growing North American market. At Toyota’s new plant in Guanajuato, Mexico, which is currently under construction, Toyota plans to produce the Tacoma, instead of the Corolla. There will be no substantial impact on Toyota’s investment and employment plan there.

2) Jointly develop technologies for electric vehicles

With increasing demand and expectations for electric vehicles worldwide, Toyota and Mazda are to explore joint development of technologies for the basic structure of competitive electric vehicles, mobilizing and exchanging expertise freely and actively. These technologies will allow the companies to respond quickly to regulations and market trends in each country. Specific details of the collaboration will be determined as the companies work together going forward.

3&4) Jointly develop connected technology and collaborate on advanced safety technologies

Toyota and Mazda will work together to jointly develop technologies for onboard multimedia infotainment systems in preparation for increased use of in-car information technologies and the increasing demand for connected technologies. In addition, Toyota will cooperate with Mazda in Toyota’s vehicle-to-vehicle (V2V) and vehicle-to-infrastructure (V2I) technologies with the ultimate goal of creating a mobile society devoid of accidents.

5) Expand complementary products

Currently, Mazda is supplying a compact sedan to Toyota in North America. In addition, Toyota is to supply a compact commercial “two-box” van to Mazda in Japan. Beyond this, the companies will further explore the possibilities of other complementary products on a global level.

Source: Mazda