This could be the start of a beautiful business partnership.
After its romance with Volkswagen AG ended in a bitter breakup last year, Suzuki is considering hopping into bed with the world’s largest automaker.
Toyota and Suzuki issued a joint press release today announcing their intention to get together and see where it goes.
The two automakers aren’t committing to anything at this point, only stating that both will “start exploring ideas that are directed towards a business partnership.”
Toyota overtook Volkswagen as the world’s largest automaker in September, but even industry leaders recognize their shortcomings. Both automakers cite increasing consolidation in the industry and the limitations of a single company’s R&D operations as the reason for the potential hook-up.
“In addition to efforts to tackle environmental and energy issues, as well as to ensure our customers’ safety and security, we are required to work on the R&D of advanced and future technologies, such as on automated driving,” said Toyota president Akio Toyoda in a release.
The executive admitted Toyota is “not really good” at creating alliances. Still, the automaker needs to “cover its bases” and create the “capability to respond to changes in order to survive,” he said.
While Toyota is strong in R&D, Suzuki knows small cars and emerging markets. In many ways, the potential partnership looks a lot like the Nissan-Mitsubishi alliance announced earlier this year. (In that deal, however, Nissan was Mitsubishi’s financial savior.)
Speaking at a joint press conference, Suzuki chairman Osamu Suzuki said the potential partnership was his company’s idea. A month ago, Suzuki approached Toyoda to talk collaboration.
Suzuki’s automotive operation is rooted in selling cheap minivehicles in Japan and India, which puts the automaker on shaky ground, the chairman says.
“Even in such countries, we have understood that there will be uncertainty in the future if we only continue to just refine our traditional automobile technologies which we have been working on thus far,” Suzuki stated.
Suzuki entered into an ill-fated alliance with Volkswagen in 2009, with the German automaker taking a 19.9-percent stake in its Japanese partner. The Love Boat then sailed directly into the rocks. There were reports of problems with joint projects and acrimony between both companies’ engineers and management, which spelled a quick end to the once-promising alliance. Other accounts, published by TTAC in 2012, place blame for the failed alliance directly at Osamu Suzuki’s feet.
An international arbitration court completed the divorce.
Oddly, the court ruled in Suzuki’s favor one month before Volkswagen’s diesel emissions scandal blew up in its face. Hearty laughs, no doubt, could be heard in Hamamatsu.
[Image: Toyota Motor Corporation]
Suzuki to Toyota: “Hey we know you’ve got that thing going on with Subaru and Mazda, but we should try dating and see what happens. I think I’ve finally gotten over the emotional trauma of GM.”
After a Swift trip to a rehab center in Reno, their Esteem has returned and they’re looking for a new Sidekick!
Nicely done!
For Suzuki, it is a Wish come true, a Classic Duet, but they know which will be the Master. The Echo of the previous deal with VW now gone, this should be a Picnic, more likely to Succeed. Toyota and Suzuki will have a Funtime, watching that Fun Cargo.
“Excuse me, Suzuki-san, you have a phone call, from a Signore Marchionne.”
The deal just got 86-ed. Que Sera, Sera.
That’s interesting – Toyota is in a keiretsu with Yamaha, a Suzuki motorcycle competitor.
And Toyota is already working with Mazda and Subaru. The trend towards consolidation wont stop, it’s a good thing that the big companies are as generally well-respected as they are.
What’s more interesting is whether they have plans to make Daihatsu and Suzuki work together, there could be some very interesting synergies.
Yeah within the kei-car space this is really a big deal, as Toyota’s Diahatsu and Suzuki seem to me to be the top players in that space (along with Honda). How would that work?
I for one would love to see some Toyota-backing (dealership network for example) to bring back the “true” Suzuki back to our shores. Not warmed over Daewoos but true home-grown Japanese designs. The SX4 lost something in translation from the Swift IMO, and the final years of the Grand Vitara lost their low range transfer case and lagged behind the “usual suspects” in the compact CUV class in every other way. If there was any way at all to federalize the Jimny for stateside sales, that would be fantastic. Pitch it as a more ‘authentic,’ cheaper, return-to-basics Jeep.
And how bout that X-90 they had!
gtemnykh,
The SX4 wasn’t related to the Swift. The SX4 was a version of the Fiat Sedici designed by Italdesign. The ones sold in the US were built in Japan (the one I test drove had a J-VIN) but not sure about the Fiats. The Swift was a smaller car and the Swift that looked similar to the SX4 was newer.
Ah good to know. The SX4 strikes me as needlessly thirsty, not particularly sporty, and it isn’t even very roomy. It lost the light weight and Mini Cooper-ness that the overseas Swift had.
The SX4 that I test drove was made in Hungary.
So far as I know, certainly in Canada, the low range became standard farther down the Grand Vitara range as the years went by, not less. (We have an ’06, and when we bought it only the top model had the low range.) Interesting also to note that the’06 Grand Vitara generation is still in production in some markets. I always said the Grand Vitara would have sold in large numbers if it had had a Toyota nameplate.
Maybe it’s to be more competitive against the Korean chaebols.
Dear Toyota: Please swallow me whole, and put me out of my misery.
I really don’t see much benefit to Toyota. They have plenty of small-car know-how through Daihatsu as well as their own products.
The only thing that Suzuki could offer is a distribution channel in India, but I don’t think that such a thing is on offer here. (Nor US distribution of Suzuki products, for that matter.)
If Toyota were to buy Suzuki outright, it could be different, but I don’t think Osamu would accept that from Toyota any more than from VW. And even then, the product overlap is far worse than between Toyota and Subaru.
Suzuki is so small that it remains an obvious takeover target while it has a large enough presence in certain markets (India) to make it compelling.
Aside from India, one reason for Toyota to do it is so that someone else doesn’t.
Toyota badged Jimny in the USA please!
http://www.globalsuzuki.com/automobile/lineup/jimny/
Ha ha! Samurai nevah die!
Toyota has to be the most attractive dance partner for these small and vulnerable companies. Namely because they have no history or apparent inclination to turn the arrangement into a takeover, or to influence competitive overlap in first world markets. Also, they have valuable ip, but they are underutilized it. VW, GM and Chrysler are all struggle snugglers in this arena, while ford seems actively hostile to the idea under its current management. Daimler, well, they have a crap recent record when it comes to synergies, and are busy underperforming their current tie up with Nissan. Nissan itself doesn’t really have anything to offer besides a big us dealer network to small car specialists.
>>”Suzuki entered into an ill-fated alliance with Volkswagen in 2009, with the German automaker taking a 19.9-percent stake in its Japanese partner. The Love Boat then sailed directly into the rocks.”<<
Suzuki pinched VAG designs and VAG sold them exploding gearboxes (Baleno) – a partnership made in Hell !
Suzuki is on the rocks and Toyota will clean them out just like it did with Daihatsu.
They say partnership, I say takeover.
If this “partnership” goes well, Suzuki automobiles won’t exist in ten years. They might have Suzuki branded motorcycles, but not cars.
Toyota acquired a majority stake in Daihatsu eighteen years ago, and that brand is still up and running.
but….according to the article “Toyota is not really good at creating alliances”