Toyota and Subaru Strengthen Partnership
This comes about a month after Toyota announced the purchase of a five percent stake in Suzuki, yet another tie-up that illustrates how car companies are scrambling to improve economic efficiency as they build new mobility services and electrified vehicles.
“In this once-in-a-century period of profound transformation, by strengthening their bonds and aligning their capabilities, Toyota and Subaru aim…to make ever-better cars,” Toyota said in a statement.
Toyota’s investment in Subaru amounts to approximately 80 billion yen, or $742 million, based on Subaru’s stock market value. Subaru, which sells about a tenth the amount of vehicles as Toyota does every year, will buy a stake in Toyota of equal value.
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After the announcement, Subaru president Tomomi Nakamura was insistent that despite Toyota’s increasing stake in the company, it would remain independent. “I can assure you that there was absolutely no talk of Subaru becoming a Toyota subsidiary…either from our side or theirs,” he said.
As the automotive industry is transitioning to a business model that revolves around providing transportation services rather than simply selling cars to drivers, traditional car manufacturers have struggled to keep up with the fast pace of change, particularly smaller ones like Subaru and Suzuki.
Even giants like Toyota — and others including Ford, Volkswagen, Nissan, and Honda — have found it necessary to strike alliances with rivals to chase scale in order to help cut down development and manufacturing costs.
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