Although Toyota and Daihatsu will compete and maintain separate management styles that capitalize on their respective capabilities, bringing the two together under a shared strategy will enable them together to overcome otherwise prohibitive obstacles in the future, including resource-intensive undertakings such as the development of next-generation technologies and entry into business areas with growth potential.

Implementing the Toyota New Global Architecture has once again made us aware of the difficulties involved in manufacturing small cars. At the same time, the importance of small cars is increasing as we face ever-greater environmental issues the world over, and as emerging markets continue their inevitable growth.

There are many things we have chosen to focus on as a company: in certain regions like North America, our strength lies in the mid-sized sedan segment and above. More generally, we have a good track record in our development of technologies―particularly environmental technologies. However, I have frequently worried that we haven’t managed to make our presence felt in the small car segment. Unless we gain the know-how necessary to better develop small cars, we may deprive ourselves of the chance to make crucial breakthroughs.

We at Toyota are fixated on the need to be able to cover all of our own bases; you might say we are obsessed with self-sufficiency. So, on one hand, while we have a long and credible history of producing small vehicles ourselves, on the other hand, our desire to go it alone has prevented us from achieving our full potential in terms of global competitiveness. Naturally, this decision was a difficult one to make. In the end, the only reason we could make such a monumental decision was because we are talking about entrusting part of that obsession to none other than Daihatsu.

—Akio Toyoda

Toyota and Daihatsu, which has been in business for 109 years, first began collaborating in 1967.

Areas of strategic collaboration will include:

• Small cars. The differentiation between Toyota’s and Daihatsu’s brands will continue, and the product lineups of both will be optimized in accordance with customer preferences, with Daihatsu taking the lead in developing products offered within the small car lineups of both brands. At the same time, Daihatsu will continue to focus on developing vehicles aimed specifically at customers in the areas in which the brand already has a strong presence, while also honing its expertise and processes related to product planning and technological development for minivehicles.

• Technology. Both companies will share development and deployment strategies for new technologies from the initial conceptual stages. Toyota’s focus will remain on technologies related to the environment, safety, user experience, and comfort, while Daihatsu will continue to leverage its aptitude for turning technologies into packages for vehicles, as well as developing cost- and fuel-efficient technologies. Daihatsu will also contribute to the development of next-generation technologies from the perspective of cost-efficiency and miniaturization. The company’s specialized car manufacturing expertise will be shared within the Toyota Group, which will contribute to further enhancing the cost competitiveness of larger vehicles.

• Operations. Both companies will utilize each other’s bases of operations in emerging markets. Daihatsu will take the lead in enhancing efficiency and adaptability in development, procurement, and production processes. Within Japan, Toyota’s sales expertise and infrastructure will be utilized by both companies to improve Daihatsu’s branding and profitability.