Moving beyond their technology & platform-sharing partnership, Toyota & Suzuki are all set to enter into a capital alliance to achieve cooperation in new fields of mobility.
The two Japanese giants, Toyota & Suzuki, first announced their intention to collaborate in 2017. In March 2019, specific details pertaining to their alliance emerged with respect to product development & mutual sharing of product platforms. The alliance aims to benefit from Toyota's strength in electrification technologies and Suzuki’s strength in technologies for compact vehicles.
Now, the two organisations have announced that they will establish a 'capital alliance', which, as per the press statement, 'Intends to achieve sustainable growth, by overcoming new challenges surrounding the automobile sector by building and deepening cooperative relationships in new fields...' The 'new fields' in question here largely refers to advancements in the autonomous driving space.
As per the terms of the alliance, Toyota aims to acquire a 4.94% stake in Suzuki, via a 96 billion Yen purchase (about ₹ 6,486 crores) of 24 million shares of Suzuki. Likewise, Suzuki aims to purchase Toyota shares worth 48 billion Yen (about ₹ 3,243 crores), which translates to an approximately 0.2% stake in Toyota. The transactions are set to go through once the companies obtain approvals from the foreign competition authorities.
A key highlight of the Suzuki-Toyota alliance is the sharing / cross-badging of products. In India, we saw the very first result of this alliance in the form of the Toyota Glanza, which is essentially a re-badged Maruti Suzuki Baleno.