Toyota Motor Corporation and Isuzu Motors have agreed to dissolve their capital tie-up, with Toyota planning to sell its entire stake in Isuzu in the future. However, the two companies intend to maintain their strong relationship, through ongoing joint development projects related to basic technologies, and will remain open to the possibility of a future collaboration.
In November 2006, Isuzu and Toyota signed a basic agreement to utilize each other’s operational resources with a main focus on development and production of diesel engines. At the same time, Toyota also agreed to obtain a stake in Isuzu.
The companies further said that changes in the market environment prompted them to suspend some of the originally considered projects, and little specific progress achieved in other collaborative efforts made the companies reexamine the capital relationship. Toyota owns 50 million shares or about 5.89% in Isuzu.
If things change in the automotive industry, Isuzu and Toyota intend to accelerate their efforts to improve competitiveness in the commercial and passenger vehicle markets, respectively.