TOKYO (AP) – Japan’s largest automaker Toyota is adding two companies specializing in small “kei” cars, Daihatsu and Suzuki, to a utility vehicle partnership it set up with Hino and Isuzu earlier this year.
Announcing the deal on Wednesday, Toyota Motor Corp. general manager Akio Toyoda said it would speed up efforts to become greener and more sustainable, as kei cars account for around 40 percent of the Japanese car market.
Fuel-efficient kei cars, defined by their small size and maximum displacement of 0.66 liters, are popular with farmers, delivery people and retailers. Their small size is a plus for maneuvering on the back roads of Japan and fitting into small parking spaces.
“We want to provide better lives for people,” Toyoda said at an online press conference. “Kei cars are a practical and durable lifeline for Japan. ”
As part of the Commercial Japan Partnership, announced in March, Toyota, Isuzu Motors and Hino Motors are working together in electric, hydrogen, connected and autonomous technologies.
These three automakers together control 80% of the Japanese truck market.
The addition of Daihatsu and Suzuki strengthens the partnership, and manufacturers can work together to develop electric models together, the companies said.
As part of the latest deal, Suzuki and Daihatsu will each acquire a 10% stake in the Commercial Japan Partnership Technologies Corp. joint venture.
Capitalized at 10 million yen ($ 91,000), it will be 60% owned by Toyota and 10% each by Isuzu, Hino, Suzuki and Daihatsu by the end of July.
Toyoda recognized that companies are rivals, but they must work together for the benefit of customers.
Working together can help automakers reduce costs and increase efficiency. Kei models also have potential for other parts of Asia, such as India, where Suzuki is a major player.
Toyota and Suzuki have had a small car partnership since 2016, and they entered into a momentous tie-up in 2019.
Suzuki chairman Toshihiro Suzuki said he viewed kei as crucial “works of art” for Japanese society.
“I was so happy to learn that President Toyoda had the same vision as me,” Suzuki said.
Yuri Kageyama is on Twitter https://twitter.com/yurikageyama
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