Toyota Buying 4.94% Stake In Suzuki For 96 Billion Yen

Toyota Buying Stake In Suzuki

While Toyota and Suzuki have been working hand in hand for platform-sharing and joint development of EVs, the new development intensifies the partnership

In a recent development, it has come to light that Japanese starwalts, Suzuki Motor Corp and Toyota Motor Corp, have forged deeper ties by acquiring stakes in each other. This should lead to deeper collaboration between the two manufacturers as they are likely to get more involved in the platform-sharing and co-development of EVs for developing markets like that of India.

As per the sources, Toyota will purchase a 4.94% stake in Suzuki for 96 billion yen, while Suzuki will buy shares worth 48 billion in Toyota. These minority acquisitions are aimed at helping the companies establish deeper ties with each other and result in quicker development of electric and hybrid vehicles.

This may be a prelude to bigger participation from Toyota in the stocks of Suzuki Motor. This collaboration will be key for Suzuki to sustain in a world where technology in the automobile sector is evolving rapidly and the company doesn’t have deep pockets,” commented an associate of Suzuki’s Indian unit. “When collaboration between two large corporate entities leads to an equity investment, then it does indicate a certain future,” he further added.

Toyota Starts Selling Suzuki Models From Its Showrooms In Kenya 1It maybe noted that Toyota and Suzuki first joined hands in 2017 for the development of low-cost hybrid and electric vehicles in the country. While Toyota agreed to provide Suzuki with its hybrid technology, Suzuki agreed to share vehicles in markets like that of India and others.

The two companies plan to establish and promote a long-term partnership for promoting collaboration in new fields, including the field of autonomous driving. The execution of the capital alliance agreement is a confirmation and expression of the outcome of sincere and careful discussions between the two companies, and it will serve for building and promoting their future partnership in new fields,” the two companies said in a joint statement.

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Suzuki needed support to survive in the future and nothing can be better than Toyota since it’s Japanese and there are lots of white spaces where both can complement each other,” said Puneet Gupta, associate director of consulting firm IHS Market. He added, “If Suzuki, in the long term, is taken over by Toyota, then exchanging a small stake in each other is a good beginning or a first step. Right from dealers to suppliers around the world, (everyone) will get a clear indication that both companies will have a common vision and there will be a lot of synergies.