TOKYO, Aug. 4 (Xinhua) -- Japan's two major car-makers Toyota Motor Corp. and Mazda Motor Corp. said Friday that they have signed an agreement to enter a business and capital alliance to deal with the growing competitions and challenges in the industry.
According to the agreement, Toyota will acquire a 5.05 percent stake in Mazda for 50 billion yen (454 million U.S. dollars), while Mazda is to buy a 0.25 percent shareholding in Toyota that are equivalent in value to the Mazda shares.
The two companies will also launch a joint venture plant in the United States with equal funding contributions, which would have an estimated annual production capacity of approximately 300,000 units.
At the new plant which is expected to start operation in 2021, Mazda expects to produce cross-over models that Mazda will newly introduce to the North American market, and Toyota plans to produce the Corolla for the North American market.
The two automakers have also agreed to jointly develop technologies for electric vehicles, connected-car technology, and collaborate on advanced safety technologies.
Marking the agreement, Toyota President Akio Toyoda said that the partnership "sparked Toyota's competitive spirit, increasing our sense of not wanting to be bested by Mazda. "
Representing Mazda, President and CEO Masamichi Kogai said that the alliance could help "energize the auto industry and create more car fans by bringing together two competitive spirits to spur each other on."
Toyota and Mazda entered an agreement in May 2015 to build a continuous partnership, including boosting cooperation in developing environmentally friendly and safe-driving technology.
The capital tie-up announced Friday was meant to further enhance partnership to deal with the growing challenges faced by the auto industry, including stricter environmental and safety regulations for new vehicles and the entrance of competitors from other industries, according to the joint announcement. Enditem
A single purchase
