Toyota has announced buying 4.94 per cent stake in Suzuki while the latter will acquire 48 billion yen worth shares in its Japanese compatriot
The partnership between Toyota and Suzuki has been blossoming since the initial announcements were made a couple of years back. But, for the first time, both the Japanese compatriots have enrolled themselves in an equity alliance to tackle the unpredictable and ever-changing automobile market scenario.
They have extended their arms into other departments in addition to the OEM vehicle supply and hybrid technology sharing as they go deeper into manufacturing, sales and service tie-ups along with stepping into new avenues in the burgeoning autonomous tech space and electric mobility.
More importantly, Toyota will buy 4.94 per cent stake holdings in Suzuki for 96 billion yen (more than Rs. 6,450 crore approximately) while Suzuki will acquire shares worth 48 billion yen in Toyota. In the near future, we can expect Toyota and Suzuki to jointly bring up self-driving based technologies.
The announcement would not have come at a better time for Suzuki, as Toyota has wider global presence and resources for sustainability in the coming years. It can be used by Suzuki and do not be surprised if Toyota buys more into its Japanese compatriot as the relationship progresses.
While a possible merger cannot be ruled out as per media outlets, the capital alliance deal currently expresses the trust between each other in various fields. The agreement holds key for Suzuki moving forward in countries like India, South Africa and in Latin America where Toyota could use its expertise to have a strong foothold of its own.
The first rebadged product from the alliance, Toyota Glanza, is already up and running in India while more vehicles are in the pipeline under the same technique. Using Toyota dealerships, Suzuki has started selling its own cars in some parts of Africa as well.
The Vitara Brezza is said to be manufactured at TKM’s local facility from 2022 while a Toyota C-segment MPV co-developed with Suzuki is also arriving in the near future. Having a strong back up from a global giant like Toyota in terms of technology and other means will aid Suzuki to establish itself on a longer phase for sure.