Japanese auto majors Toyota Motor Corp and Suzuki Motor Corp that have been in talks on a tie up for electric and hybrid vehicle development since last year, on Friday provided further details on the scope of the collaboration. The two companies said Suzuki will develop a compact ultra high efficiency powertrain with technological support from Toyota and Denso Corp. The vehicles that would be powered by this powertrain would then be produced at Toyota's Bangalore factory and sold through the distribution network of both Toyota as well as Maruti Suzuki.
The scope of sale of these vehicles will not be restricted to India alone and would also include export markets like Africa where both companies would be free to use each other's distribution network.
Friday's announcement significantly enhances the scope of cooperation between the two companies. Only in March, the two companies had concluded a basic agreement that would see Toyota sell Maruti's premium hatchback Baleno and compact SUV Vitara Brezza through its own subsidiary in India, while Maruti would get Toyota's global best selling model Corolla for India by early next year.
"Suzuki was the first (among Japanese companies) to enter India, and, together with the people of India, has been a presence for pulling forward India's automotive society. Such represents the spirit of "Let's do it" that I mentioned when announcing the conclusion of our memorandum of understanding on beginning concrete examinations for business partnership. Or, as I like to say, Suzuki is a company that puts into practice being "The Best in Town," said Akio Toyoda, the president of Toyota Motor Corp. "As members of Indian society, Toyota, along with Suzuki, will do its best to enhance freedom and fun in a future society of mobility and to make "Make in India" vehicles cherished in Africa and in many other countries around the world."
"Breaking from a future that adheres to convention, Toyota has chosen a future in which the path is created by one's own hands. For this, the spirit of "Let's do it" is necessary. Through our business partnership with Suzuki, I would like to learn more about this spirit," he added.
The two companies have been in talks since November last year for a business cooperation for the Indian market with focus on electrification and hybridization of their portfolio in the country.
Toyota is one of the pioneers in alternate vehicle technologies worldwide and has the best selling hybrid model in the world in the Prius. It is an area that is a weakness for Suzuki. At the same time, Toyota's position is considerably weak in emerging markets like India where it has less than 5 per cent market share.
"At the time we announced the partnership, I said: "Under the leadership of President Akio Toyoda, Toyota was enthusiastic throughout our discussions regarding partnership sought by Suzuki, which was concerned about the development of advanced technologies. I want to express my heartfelt appreciation. Immediately afterwards, Toyota arranged a series of intensive and meaningful discussions. Now, we will receive support for the development of a compact, ultrahigh-efficiency powertrain that is vital to Suzuki, and we will focus our utmost efforts on development," said Osamu Suzuki, chairman, Suzuki Motor Corp. "It is my hope that the new joint projects will contribute to the future success of both companies, not only in India, but also in the global market."