Toyota and Mazda Enter Business and Capital Alliance
August 04 2017 - 5:13AM
JCN Newswire (English)
Toyota Motor Corporation (Toyota) and Mazda Motor Corporation
(Mazda) signed an agreement today to enter a business and capital
alliance, with the aim of further strengthening their lasting
partnership.
Today's agreement is a testament to the positive result of two
years of collaborative and deliberate discussions between the two
companies, and it is a milestone in the journey to further
strengthen and accelerate the partnership in a sustainable way.
Specifically, the companies agreed to: 1) establish a joint venture
that produces vehicles in the United States, 2) jointly develop
technologies for electric vehicles, 3) jointly develop
connected-car technology, 4) collaborate on advanced safety
technologies and 5) expand complementary products.
In addition, together with the aim of advancing and strengthening
their long-term collaboration, Toyota and Mazda agreed to a capital
alliance arrangement that preserves independence and equality for
both companies. In the capital tie-up, the two companies have
agreed that Toyota will subscribe for and acquire shares to be
newly issued by Mazda through a third-party allotment, and at the
same time Mazda will subscribe for and acquire third-party
allocation shares of treasury stock disposed of by Toyota in the
equivalent amount in value to the Mazda shares. The value of the
shares mutually acquired by both companies will be equivalent.
Marking the agreement, Toyota President Akio Toyoda said: "The
greatest fruit of our partnership with Mazda is that we have found
a new partner who truly loves cars. It has also sparked Toyota's
competitive spirit, increasing our sense of not wanting to be
bested by Mazda. This is a partnership in which those who are
passionate about cars will work together to make ever-better cars.
It is also the realization of our desire to never let cars become
commodities."
Representing Mazda, President and CEO Masamichi Kogai said:
"Nothing would please me more than if, through this alliance, we
can help to energize the auto industry and create more car fans by
bringing together two competitive spirits to spur each other on,
leading to innovations and fostering talent and leaders."
The auto industry increasingly faces great challenges, including
stricter environmental and safety regulations for new vehicles and
the entrance of competitors from other industries, as well as the
diversification of mobility-related businesses. With the future of
the industry in mind, in addition to leveraging their individual
strengths to further improve technologies and reinforce their
business foundations, Toyota and Mazda aim to deepen collaboration
and achieve sustainable growth through their partnership, rising to
face and overcome these pressing challenges.
On May 13, 2015, Toyota and Mazda entered an agreement to build a
continuous partnership that would mutually benefit the companies in
such forms as leveraging the resources of both companies and
complementing each other's products and technologies toward the
goal of making more-appealing cars. Since then, both companies have
discussed various areas to explore, based on the principle of
building an equal and favorable relationship in the long term.
Over the medium- to long-term, the two companies will build a
favorable relationship that respects the autonomy and equality of
each party and works toward success with the agreed joint projects.
With the aim of creating new types of value for future mobility,
they will accelerate and enhance bilateral cooperation as long-term
partners and contribute to the development of a sustainable society
by exceeding customers' expectations.
Details of the agreement on business alliance
1) Establish a joint venture that produces vehicles in the U.S.
As part of the new alliance, Toyota and Mazda have agreed to
explore establishing a joint venture plant in the U.S. with equal
funding contributions. The plant would have an estimated annual
production capacity of approximately 300,000 units. Pending
approvals and authorization by relevant government agencies, the
companies will begin to examine detailed plans with the goal to
starting operations of the new plant in 2021. The plant will
require a total investment of approximately 1.6 billion U.S.
dollars, and will create up to 4,000 jobs. In addition to the
collaboration in product and technology areas that the companies
have enjoyed thus far, Toyota and Mazda intend to improve
competitiveness in manufacturing through this new production
collaboration.
At the new plant, Mazda expects to produce cross-over models that
Mazda will newly introduce to the North American market, and Toyota
plans to produce the Corolla for the North American market.
By producing vehicles in the U.S., Mazda aims to build a production
structure to further grow in North America. These activities will
allow the company to more quickly respond to its customers' needs
depending on the region and model.
By further increasing its production capacity in the U.S., Toyota
is to further pursue management that is closer to the region, as a
measure to improve its response to the growing North American
market. At Toyota's new plant in Guanajuato, Mexico, which is
currently under construction, Toyota plans to produce the Tacoma,
instead of the Corolla. There will be no substantial impact on
Toyota's investment and employment plan there.
2) Jointly develop technologies for electric vehicles
With increasing demand and expectations for electric vehicles
worldwide, Toyota and Mazda are to explore joint development of
technologies for the basic structure of competitive electric
vehicles, mobilizing and exchanging expertise freely and actively.
These technologies will allow the companies to respond quickly to
regulations and market trends in each country. Specific details of
the collaboration will be determined as the companies work together
going forward.
3) Jointly develop connected technology and collaborate on advanced
safety technologies
Toyota and Mazda will work together to jointly develop technologies
for onboard multimedia infotainment systems in preparation for
increased use of in-car information technologies and the increasing
demand for connected technologies. In addition, Toyota will
cooperate with Mazda in Toyota's vehicle-to-vehicle (V2V) and
vehicle-to-infrastructure (V2I) technologies with the ultimate goal
of creating a mobile society devoid of accidents.
4) Expand complementary products
Currently, Mazda is supplying a compact sedan to Toyota in North
America. In addition, Toyota is to supply a compact commercial
"two-box" van to Mazda in Japan. Beyond this, the companies will
further explore the possibilities of other complementary products
on a global level.
Details of the capital alliance
Based on the agreement, the companies will aim to develop
sustainable collaboration, maximizing the synergies of the business
and capital alliance by mutually acquiring shares as stated
below.
Toyota will acquire 31,928,500 shares of common stock newly issued
by Mazda through a third-party allotment (shareholding ratio of
5.05% on an issued share basis after the capital increase; total
value of 50 billion yen).
Mazda will, through a disposition of treasury stock through a
third-party allotment to be implemented by Toyota, acquire Toyota
shares that are equivalent in value to the Mazda shares
(shareholding ratio of 0.25% on an issued share basis).
The two companies plan to apply proceeds from the capital increase
through the third-party allotment and the disposition of treasury
stock through the third-party allotment to fund, in part, capital
expenditures relating to the establishment of the joint venture to
produce vehicles in the U.S.
Both companies are to consider strengthening their capital alliance
further, in line with the progress of their business alliance.
Schedule
1) Date of signing the agreement:Friday, Aug. 4, 2017
2) Anticipated date of share acquisition (due date of the payment):
Monday, Oct. 2, 2017
About Toyota
Supported by people around the world, Toyota Motor Corporation
(TSE:7203; NYSE:TM), has endeavored since its establishment in 1937
to serve society by creating better products. As of the end of
December 2013, Toyota conducts its business worldwide with 52
overseas manufacturing companies in 27 countries and regions.
Toyota's vehicles are sold in more than 170 countries and regions.
For more information, please visit www.toyota-global.com.
Source: Toyota
Contact:
Public Affairs Division
Global Communications Department
Toyota Motor Corporation
Tel: +81-3-3817-9926
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