The Nikkei reports that Toyota Motor has decided to outsource production of advanced diesel engines to Isuzu Motors.
In November 2006, Toyota took a 5.9% stake in Isuzu and the two companies began “studying the synergic effects of business collaboration” much of it focused on the development of advanced diesels for the light duty market. (Earlier post.)
The two are jointly developing a 1.6-liter advanced, low-emissions diesel engine that features cutting-edge fuel injection and catalyst technologies.
Isuzu reportedly will invest about ¥30 billion (US$244 million) to build a diesel engine plant in Hokkaido that will exclusively supply Toyota, which plans to use the engines in passenger cars sold in Europe. The new facility is expected to produce 200,000 units a year from 2012 on.
Toyota currently produces diesel engines in Poland to support its European sales.