Toyota and Subaru join hands in new capital alliance

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In a bid to further strengthen their relationships and enhance business development on a long-term basis, Toyota Motor Corporation and Subaru Corporation have agreed on new business collaboration.

The previous business collaboration agreement between the two auto manufacturers ended back in 2005. The new agreement will include the following:

  • Contract production of Toyota vehicles by Subaru
  • Supply of cars by Toyota to Subaru
  • Joint development of the rear-wheel-drive Toyota 86 and Subaru BRZ sports car models

Furthermore, the two companies have also recently jointly agreed on developing a dedicated platform for the production of battery-electric vehicles (BEV’s). In this agreement, a battery-electric vehicle model will be developed using the All-wheel drive (AWD) technology of Subaru and vehicle electrification technology by Toyota. The decision came while keeping in view the technological advancement in the automotive sector. The new domains of CASE include connected, autonomous/automated, shared, and electric, which demands to keep up the pace with the global market. The alignment of the capabilities of both auto companies would result in a strengthened bond and hence, the transformation towards the electric future. The alliance would allow the companies to manufacture cars better than they have ever produced before. However, the companies aim to respect the identity of each other’s brand during this partnership. Moreover, Toyota will increase its equity stake in Subaru, and in return, Subaru will be acquiring shares in Toyota in this new business deal. As a result, a total of 20% voting rights in Subaru will be acquired by Toyota in the future.

Apart from the above-mentioned activities, the scope of the use of the Toyota Hybrid System will be expanded in other Subaru models. The two companies will be cooperating in the domain of connected vehicles and autonomous driving. They have long been pursuing driving enjoyment and now plan to pursue the possibilities of producing better cars that are suitable for the CASE era. The presidents of both companies are confident about their relationship and believe in deepening them further by combining their strengths. The last agreement between them lasted for 14 years, which ended in 2005. Both companies already share a strong bond in terms of product development, production, and sales. Nonetheless, the capital alliance would result in a considerable benefit for the customers as they will get advanced technological cars in the future beyond that achieved thus far by Toyota and Subaru.

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