Engineering news
By 2021, the new factory will be capable of producing 300,000 vehicles a year, and will employ about 4000 people. The companies will work together to develop battery powered cars, as well as in-car information systems and autonomous vehicle functions.
This is a partnership in which those who are passionate about cars will work together to make ever-better cars,” said Akio Toyoda, Toyota’s president to reporters.
As part of the deal, Toyota will take a 5% stake in Mazda, with Mazda receiving a 0.25% in its larger rival.
The deal marks the latest collaboration between Toyota and its local competitors. In February it announced a plan to co-operate with Suzuki in research and development, and already works with Subaru on a compact sports car model.
“Mazda has been producing the Toyota Yaris iA and now the Yaris for us in Mexico, so we’ve had this relationship with them for a couple of years,” said Toyota’s North America CEO Jim Lentz in an interview with Dallas Morning News. “There’s a lot of trust built up between the two companies.”
Mazda, whose sales are an eighth that of Toyota, says it lacks the funds to develop electric cars on its own. Toyota, meanwhile, has set a goal for all of its vehicles to be zero emissions by 2050. Last year, it launched a division to develop full-sized electric vehicles.
Industry analysts say the move is a sign of the increased competition in the automotive sector from new entrants such as Google, Apple and Amazon, who are all developing self-driving technology. “Given the massive level of competition in the industry, partnerships are no longer a surprise,” Akshay Anand, an executive analyst at Kelley Blue Book, told the National Post.
The factory will be used to build Toyota Corollas, and as yet un-named Mazda SUV crossover vehicle. The decision to build the plant in the US has been hailed as a boost for American manufacturing. “The new presidential administration has made it clear investments in the U.S. are a top priority, and this plant may be another nod to that mindset,” said Anand.
Toyota had previously planned to build the new Corolla at a proposed factory in Mexico. In a tweet, President Trump – who had criticised that plan – called the new deal “a great investment in American manufacturing!”. Toyota said Trump’s views had not influenced the decision. “We have been reviewing the best production strategy for our business,” he said.
According to Lentz, a location for the new factory has not yet been determined. The company currently has a number of factories across the southern United States.