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Toyota and Isuzu Join Forces

Japan?s Toyota Corp. and Isuzu Motors Ltd. have recently announced their joint venture in forming a capital alliance and diesel engine development tie-up. The two mega companies have decided to work together toward the research and development of small diesel engines and gas emission control, among other areas. In addition to the research and development tie-up, Toyota will buy 60 million Isuzu shares from Japanese trading house Mitsubishi Corp. as well as 40 million from Itochu Corp., another trading house.

?Toyota will be able to outsource diesel engines from Isuzu in Europe and the US. In addition, it will be able to establish competitive advantage in the market of pickup trucks, which is an important market in North America and emerging markets,? said Kunihiko Shiohara, an analyst at Goldman Sachs. The move is the latest amid a repositioning of the global truck industry. Toyota will be able to further strengthen its lineup of fuel-efficient power trains on top of its gasoline-electric hybrid systems by teaming up with Isuzu, which is known as a major developer of diesel engines.

It seems that the automotive and truck industry are experiencing a great deal of change in their respective markets. Many leading automotive companies are collaborating and working together in order to both benefit from the new opportunities the changes in these markets provide and offer. Toyota and Isuzu are both going to gain a great deal from this joint venture.