Toyota Motor Corp. and Suzuki Motor Corp. are strengthening their relationship by taking stakes in one another, the latest alliance in an industry that’s facing sweeping changes in technology, consumer preferences and business models.
Japan’s biggest automaker will acquire about 5 per cent of Suzuki shares for about 96 billion yen ($907 million), while Suzuki will get a smaller holding valued at about 48 billion yen in Toyota, the automakers said in statements Wednesday.
The move builds on ties established two years ago between the two carmakers and is aimed at expanding their collaboration to keep up with electric and self-driving cars, as well as growing demand for on-demand rides and new businesses that are reinventing how people get from A to B. For Toyota, the deal adds yet another automaker to the company’s expanding portfolio of partnerships, which includes Mazda Motor Corp. and Subaru Corp.
Toyota will pay 4,004 yen a share, lower than Suzuki’s closing price of 4,085 yen. Suzuki shares are down 27 per cent this year, following a 15 per cent decline in 2018 as the Indian economy cooled.
The deal gives Toyota greater access to Suzuki’s presence in India, which is on track to overtake Japan and become the world’s third-largest vehicle market.
While Suzuki is small in other markets, it occupies almost half of the market share in India.
