Toyota to Acquire 5.9% of Isuzu; Two to Work on Diesels and Alt Fuel Technologies

7 November 2006

Toyota Motor and Isuzu Motors have signed a memorandum of understanding stating they will start studying the synergic effects of business collaboration.

To “enable this business collaboration to move forward smoothly,” Toyota is purchasing 100 million shares of Isuzu from Mitsubishi (60 million shares) and ITOCHU (40 million shares) and will thereby have a 5.9% stake in Isuzu.

Although the specific form and range of the collaboration needs to be defined, there are three main points of focus for the partnership:

1. Fields related to the research & development and production of small diesel engines;

2. Joint research & development of emission-control technologies and emission-control devices for diesel engines; and

3. Environmental technologies, including basic engine and other technologies and technologies related to alternative fuels.

Isuzu and [Toyota] have come to view that, while they respect each other’s independency in management, each side could prosper further by strengthening their business relationship, as global competition intensifies.

—Toyota statement

Honda is developing a Tier 2 Bin 5 light-duty diesel engine and aftertreatment system it plans to have on the US market by 2009. (Earlier post.)