This Thursday, there was news in the automotive industry regarding two Japanese giants of the car manufacturing market. Toyota Motor Corp. said that it is in talks with Suzuki Motor Corp. about forming an alliance. The two companies would work together on new and cutting edge projects such as self-driving cars. Another area where the two Japanese companies could collaborate is designing and engineering low-cost vehicles. Toyota and Suzuki would together share the burden of research and development. That is currently an area that car companies need to invest more into in order to stay competitive.
Toyota and Suzuki Partnering to Develop New Technologies
Toyota Motor Corp. and Suzuki Motor Corp used to be rivals on the same market. But they could reach out to one another in the face of mounting competition from new companies like Tesla. The two companies said that Toyota and Suzuki coming together is a necessary step in order to survive “unprecedented” change. The automotive industry has become more and more competitive. Innovation is what puts a car manufacturing company ahead these days. People are looking for more out of car than just a vehicle that takes them from A to B. They are looking for that car to incorporate the latest technology and cater to multiple needs.
Tighter regulations on emissions are a threat to what used to be the dominance of the gasoline engine. Upstarts in Silicon Valley, California are chipping away at the market share held by traditional car companies. Having your car equipped with the latest technology is a challenge that car manufacturers need to live up to. But developing new technologies comes at a high cost. So car companies find it easier to start working together on developing the same technology that would benefit all. The changing circumstances of the automotive market is turning former rivals into friends and partners.
“There is a limit to the research and development that a company can do individually.”
Said Akio Toyoda, the president of Toyota Motor Corp.
Toyota and Suzuki Looking to Increase Sales Figures
Toyota is also looking at increasing its sales figures, especially in emerging markets. India is one of the few markets where you can still see growth in car sales. Suzuki has a market share of over 40 percent in the country. Mr. Toyoda said that Toyota is hoping to learn from the “frontier spirit” that Suzuki had. Taking a page out of Suzuki’s book in India could mean more sales for Toyota.
Toyota is the biggest auto maker in the world when it comes to volume. But sales haven’t been growing as expected in some of Toyota’s biggest markets. Also, a strong yen has meant less profit for the Japanese car company. So Toyota is looking to sell more. But what is Suzuki looking for out of the partnership? It looks like stability and a strong ally on the car market.
“There would be uncertainty in the future if we only continued to refine our current automobile technology.”
Said Osamu Suzuki, the chairman of Suzuki Motor Corp.
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