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Old 27th January 2016, 08:22   #1
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Default Suzuki & Toyota considering a partnership? EDIT: Confirmed

After the split from VW completed, Suzuki is news again- this time a possible alliance with Toyota but both companies deny report of partnership talks.

Suzuki, Japan's fourth-largest automaker, and global top-seller Toyota were discussing a possible partnership from a variety of angles including a cross-shareholding deal.

Quote:
Toyota and Suzuki are looking to take advantage of each other's know-how and capitalise on demand for compact cars in India and other emerging economies.
Suzuki, which specialises in small cars, is India's top-selling car maker through its local unit Maruti Suzuki India Ltd.

But the automaker has long been under pressure to find a bigger partner to develop next-generation fuel-saving technology as governments around the world tighten emissions and fuel economy regulations
Quote:
Japan's Toyota Motor Corp and Suzuki Motor Corp on Wednesday denied a newspaper report they were discussing a potential partnership that could include a capital tie-up

http://uk.reuters.com/article/uk-toy...-idUKKCN0V42J9

Last edited by volkman10 : 27th January 2016 at 08:41.
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Old 27th January 2016, 09:33   #2
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Default re: Suzuki & Toyota considering a partnership? EDIT: Confirmed

Something is cooking ... Suzuki shares are up by 10% and Toyota by 4%

link - obviously they'll deny it!!!
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Old 27th January 2016, 12:25   #3
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Default re: Suzuki & Toyota considering a partnership? EDIT: Confirmed

Wow, that's a surprise!

Suzuki is basically Maruti and India is its most important market. Ours is the only market where Suzuki enjoys such volumes & a dominant market-share. If these rumours are true, it could have serious effects on the Indian automotive landscape.

The only reason VW was interested in Suzuki was Maruti's control over the Indian market. Toyota would have its eye on the same thing as it's primarily a utility-vehicle manufacturer in India. Just the fact that Suzuki did tie-up with VW earlier tells me that it's worried about its relatively small size on the global scale. The arbitrators gave their verdict on the VW-Suzuki divorce in end-2015; did these supposed talks with Toyota start right then? Was Toyota waiting for the arbitration proceedings to end before taking things to the next level?

One thing for sure: Suzuki hasn't shown that it has the resources, technology or talent to develop next-generation powertrains (hybrids, EVs, hydrogen cells) in house. Toyota has (related report). But on the other hand, that can always be licenced? Considering Toyota's size, it would never play second fiddle in a partnership and Suzuki knows that all too well.

However this works out, it has the potential to become the biggest news of 2016.
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Old 27th January 2016, 12:37   #4
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Default re: Suzuki & Toyota considering a partnership? EDIT: Confirmed

Just read this:

http://economictimes.indiatimes.com/...w/50738349.cms

Toyota considering a take over of Daihatsu
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Old 27th January 2016, 12:44   #5
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Default re: Suzuki & Toyota considering a partnership? EDIT: Confirmed

To me this looks like a typical Indian ownership concern with succession issues , most of things are still managed by old man at Suzuki despite his son as President - he is very passionate and made Suzuki what it is , I think instead of handing over reins to a large company like Toyota he should instead find some CEO who can take this further. This will need large investments both in R& D as well manufacturing which in India looks on track though.

I doubt this partnership can work with synergies - Toyota will simply eat Suzuki and there aim can be getting a large share of Indian market which is supposed to remain positive for next couple of years due to growing middle class.
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Old 27th January 2016, 13:32   #6
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Default re: Suzuki & Toyota considering a partnership? EDIT: Confirmed

Here are the 2015 sales figures of Suzuki , look how lucrative the volumes in emerging markets (overseas production)- India being in focus!
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Old 27th January 2016, 14:47   #7
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Default re: Suzuki & Toyota considering a partnership? EDIT: Confirmed

Both the companies have a lot to gain for this partnership if it materialises and if it doesn't goes haywire like the partnership between Volkswagen and Suzuki.

On one hand Suzuki can get the access to hybrid technologies (Toyota Prius), diesel engines, another shot in developed markets like the US and a better know-how to make and sell bigger cars, while on the other hand Toyota can benefit from Suzuki's competencies in making small cars and it's dominance in India.

At the same time, Suzuki should be very careful in treading this path because Toyota is actually an automotive behemoth with sales of almost 10.5 million vehicles in last fiscal, which is 3 times the sales of Suzuki.

We'll have to wait and watch what the end consumers get if the deal goes through.

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Old 27th January 2016, 15:37   #8
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Default re: Suzuki & Toyota considering a partnership? EDIT: Confirmed

I thought with VW out of the partnership, Fiat would have tried for a partnership with Suzuki (Maruti) for pretty much the same reasons. Especially since engine sales to Maruti is what essentially sustains Fiat in India.
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Old 27th January 2016, 15:44   #9
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Japanese monopolistic giants have a history of cross shareholding to avoid destructive competition and join forces to take on other competitors.

It is also a way to consolidate power.

The Fiat CEO recently expressed his views about the need for consolidation in the industry due to rising costs of developing new technologies.

It actually makes sense for suzuki and Toyota to combine forces.

Last edited by ampere : 31st January 2016 at 22:53. Reason: Typo fixed
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Old 27th January 2016, 15:48   #10
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Default re: Suzuki & Toyota considering a partnership? EDIT: Confirmed

Quote:
Originally Posted by R2D2 View Post
Just read this:

http://economictimes.indiatimes.com/...w/50738349.cms

Toyota considering a take over of Daihatsu
Daihatsu is anyway Toyota's sub-brand / subsidiary or however we want to call it. From what I understand, that's the low cost division for Toyota products, under a different brand, like Dacia for Renault or Datsun for Nissan. I also read that Toyota already has 51% stake in Daihatsu.
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Old 27th January 2016, 18:25   #11
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Default re: Suzuki & Toyota considering a partnership? EDIT: Confirmed

I thought Toyota was the big daddy of Japanese auto, and that they had tie ups with pretty much everybody at some point
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Old 28th January 2016, 07:46   #12
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Default re: Suzuki & Toyota considering a partnership? EDIT: Confirmed

Why is Suzuki lucrative? An insight from Forbes,

Quote:
As demonstrated by minus signs in front of the sales results of big automakers, global sales slowed down in 2015. In the U.S., it took record low gasoline prices, and loose credit, to barely clear a sales record set 15 years ago.
The EU market has seen a comeback, but it likewise remains far below its 2007 peak. In the world’s third-largest car market Japan, sales were down hard. Big displacement growth engine China misfired in 2015, and could only be restarted with the amphetamines of the auto business, major tax breaks, which are bound to cause cold turkey in China when withdrawn.
Quote:
Looking for underserved markets with long-term growth potential, carmakers focus on the ASEAN countries, on India, and they begin to set eyes on Africa, the world’s last undeveloped car continent. A lot of people with not much money are in these regions. And this is where those tiny low cost cars come in.

Global automakers have their eyes set on India, but the top three, Toyota, Volkswagen, and GM all have a hard time getting a grip on the market. The motor-maharaja of India, a subcontinent with nearly the same population as China, is Suzuki with some 50% of the market, a lot of it thanks to the Suzuki Alto, a slightly higher motorized version of its Japanese kei car namesake. The other half of India’s 2.6 million passenger vehicle market is divided among more than 10 players, with all except Hyundai holding single digit market shares. No wonder Suzuki looks like a pretty bride.
Nikkei version,
Quote:
Toyota Motor and Suzuki Motor have begun talks on a tie-up, looking to take advantage of each other’s know-how and capitalize on demand for compact cars in India and other emerging economies.

It boasts a 40% share of the Indian passenger-vehicle market, a major profit source. Suzuki’s robust sales network, built up over three decades, would likely be a major asset to Toyota as it expands its Indian operations. While Toyota set up a production arm in India in 1997, the results have been lackluster, with its market share at just 5% or so. The automaker aims to use the partnership with Suzuki to gain a firmer foothold in areas of greater Asia outside its existing stronghold, which includes Thailand and Indonesia.

Toyota tops the global automobile market with annual group sales of some 10 million vehicles. It is a leader in safety technology, including self-driving cars, as well as eco-friendly vehicles such as the Prius hybrid and Mirai fuel cell car. Environmental and safety regulations are expected to tighten worldwide. With integration of information technology becoming essential to the industry, Suzuki likely aims to take advantage of Toyota’s next-generation technology.

Suzuki and the Toyota group will discuss the potential partnership from a variety of angles, with cross-shareholdings a possibility

http://www.forbes.com/sites/bertelsc.../#2f32dab849c8

http://blogs.barrons.com/asiastocks/...p-talk-nikkei/

Last edited by volkman10 : 28th January 2016 at 07:54.
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Old 28th January 2016, 16:16   #13
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Default re: Suzuki & Toyota considering a partnership? EDIT: Confirmed

http://www.livemint.com/Companies/AG...k-to-tieu.html

Quote:
1. Suzuki will be looking to get access to Toyota’s bigger cars and hybrid technologies. It sought these in its partnership with Volkswagen, which ended last year after a bitter court battle. The VW deal was also meant to give Suzuki access to diesel technology but this has now been placed on the back burner considering the demand for cleaner vehicles around the globe.
2. Suzuki and Toyota can access each other’s sales network. Toyota could sell its bigger cars through Maruti network in India while Suzuki could use Toyota’s global network to sell its small cars in developed markets such as US and Europe, where there is an increasing demand for small and fuel efficient cars.

3. The newer technologies such as battery tech and fuel cell are very expensive and given the way the Indian market is evolving, the need for such technologies will only increase. Given that Suzuki is still small in global terms, it lacks the capability to invest in such technologies and ideas. A tie up with Toyota would allow access to these.

4. Suzuki and Diahatsu, which are rivals, are likely to continue competing with each other. But in the auto industry that is a fairly well-established norm.

5.There could be a distant possibility of Toyota and Suzuki exploring ways to jointly develop products.
I think this might be a good time for Suzuki for thinking in those terms as there is minimal development in the clean energy technology and also with stricter safety rules in India in future their market share may dwindle. So if this deal comes through it might be a win-win situation for both manufacturers and the consumers.
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Old 28th January 2016, 16:55   #14
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Default re: Suzuki & Toyota considering a partnership? EDIT: Confirmed

Didn't they deny that they were in any partnership talks?

http://www.cnbc.com/2016/01/26/toyot...hip-talks.html

Last edited by JonSnow : 28th January 2016 at 16:57. Reason: Added source
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Old 29th January 2016, 16:35   #15
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Default re: Suzuki & Toyota considering a partnership? EDIT: Confirmed

News story : REUTERS

Toyota Motor Corp President Akio Toyoda (L) speaks next to Daihatsu Motor Co. President Masanori Mitsui during a joint news conference in Tokyo, Japan, January 29, 2016. Toyota Motor Corp, the world's largest automaker, said it would buy out the rest of minivehicle unit Daihatsu Motor Co - an all-stock deal worth about $3 billion and part of its strategy to strengthen its push into compact cars for emerging markets.
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Suzuki & Toyota considering a partnership? EDIT: Confirmed-tok340_toyotama_0129_11.jpg  

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