Conventional Twitter-wisdom has it that Toyota hates anything with batteries, and that zoom-zoom Mazda can’t kick its petroleum habit. Today, both of them joined forces to make electric cars.
Mazda, Toyota, and Toyota-Group parts maker Denso agreed to jointly develop basic structural technologies for electric vehicles. For that, they established a new company called EV C.A Spirit Corporation, domiciled on a high floor of Toyota’s Midland Square office tower across from the Nagoya train station. Toyota holds 90% of the company, while Mazda and Denso hold 5% each.
The top management of the Spirit company is similarly Toyota-heavy. The company’s CEO is Toyota Executive VP Shigeki Terashi. Directly under Terashi are Kiyotaka Ise, head of Toyota’s advanced R&D, and Toshiyuki Mizushima, who headed Toyota’s Power Train Company. Their company is so new that is website is still under construction.
Toyota and Mazda may not be totally convinced that all cars will run on batteries tomorrow, but they can read the writing on the wall. Governments increasingly proclaim an end of the internal combustion engine, sometime in the not quite near future, and an automaker needs to be ready for that.
“As countries and regions around the world adopt increasingly stringent policies to help reduce greenhouse gases,” Toyota said, “new regulations that mandate a certain proportion of electric vehicle sales are beginning to emerge. Complying with these environmental regulations, while ensuring the sustainable growth of our companies, requires the development of a wide range of powertrains and technologies. We regard electric vehicles (EVs) as a key technological field in this process alongside fuel cell vehicles.”
Getting there requires “huge investments and time,” which may be too much for a smaller automaker such as Mazda. Therefore, the companies will jointly develop the electric underpinnings for “a diverse range of models, from minivehicles to passenger vehicles, SUVs, and light trucks, and aims to innovate the development process by combining the strengths of each company, including Mazda’s bundled product planning and prowess in computer modeling-based development.” Mazda and Toyota will then develop their own electric vehicles based on the joint platforms.
Toyota and Mazda entered a loose Alliance two years ago. Last month, the companies formalized the tie-up with small cross-shareholdings, and a joint-venture plant in the U.S. Back then, the companies said they would collaborate in the development of electrified vehicles and connected car technologies. Late last year, Toyota and Suzuki entered a similarly loose agreement.
Japan’s car auto market is over-ripe for a consolidation, with smaller players struggling to cope with the investment demands brought by the push for electrification, autonomous drive, and connected technologies. Only Japan’s antitrust regulations are keeping Toyota from completely absorbing both Mazda and Suzuki.
Article Credit/Author: Bertel Schmitt, Forbes Contributor