Toyota Motor Corp. on March 20 announced that it reached an agreement with Suzuki Motor Corp. that will see the two companies share certain technology and production of hybrid, electric and compact vehicles.
The Japanese carmakers first signed a memorandum of understanding Feb. 6, 2017, and have now outlined specific details of their collaboration.
Toyota will provide its hybrid system to Suzuki on a global basis. The system powers Toyota's Prius model, the best-selling car in the hybrid category. It will also promote hybrid development in India by procuring hybrid systems, engines and batteries in the country.
Toyota will build two new electrified models based on its RAV4 and Corolla Wagon vehicles for Suzuki in Europe. The two models will be built in Japan and the U.K., respectively, the Financial Times reported.
In return, Toyota will adopt Suzuki's recently developed engines for compact vehicles. They will be manufactured at a Toyota facility in Poland.
Suzuki will also build vehicles based on its Ciaz and Ertiga models for Toyota in India and provide a number of its India-produced vehicles, including the Baleno and the Vitara Brezza, to Toyota for the African market.
In the Indian market, the two companies will work together to develop a Toyota-branded compact people carrier and produce Suzuki's Vitara Brezza compact SUV at a Toyota factory.
"We believe that the expansion of our business partnership with Suzuki ― from the mutual supply of vehicles and powertrains to the domains of development and production ― will help give us the competitive edge we will need to survive this once-in-a-century period of profound transformation," said Toyota President Akio Toyoda.
"At the time we announced our scope of cooperation in May last year, I spoke that we will strive for success globally. I have seen progress in the partnership since then, and it is my pleasure to be able to make this announcement today regarding the status of partnership on a global basis, including Europe and Africa," Suzuki Chairman Osamu Suzuki said.
The move is the latest example of increasing cooperation between carmakers as the industry seeks to balance rapid technological developments with rising costs. So far in 2019, Ford Motor Co. and Volkswagen AG have announced an alliance on commercial vehicles, which could extend to other areas including autonomous cars, while Bayerische Motoren Werke AG and Daimler AG have teamed up on mobility services.