Toyota, Mazda, and Denso Form Partnership to Build EVs

Mazda, Toyota, and parts maker Denso have created a new company to accelerate the production of electric vehicles, expand synergy, and catch up with its rivals in the electric arms race.

Called EV Common Architecture Spirit Co Ltd, the new company will bring together budgets and expertise to develop technology for all types of electric cars, including SUVs, sedans, and light trucks. Regarding equity participation, Toyota will assume a 90 percent stake and commit to most of the funding, with Mazda and Denzo each taking 5 percent, according to Toyota.

This news follows an earlier August partnership with Toyota taking on a 5 percent stake in Mazda and a 0.25 percent Toyota stake by Mazda, along with the construction of a $1.6 billion joint-venture assembly plant with a production capacity of 300,000 vehicles a year, set to open in 2021, according to Automotive News.

The new venture promises to combine strengths respective to each automaker in building electric vehicles. Toyota’s larger research and development budget, Mazda’s advancements with compression ignition engines and computer modeling, and Denso’s know-how with electronic parts is expected to help build momentum, as neither Mazda nor Toyota have a fully electric vehicle on the market. Each badge will develop their own electric cars while sharing the same platform.

Lastly, the Toyota-Mazda-Denso collaboration is a warning shot in response to increasing pressures from China to build electric vehicles and response to other partnerships made by rivals. Last year, Nissan took a 34 percent stake in Mitsubishi to share costs and merge production planning. Honda has also tried to form alliances, with its Waymo and Hitachi partnerships to build on autonomous driving and electric drivetrains.

Nikkei


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