Toyota, Mazda, Denso Partner for EV Venture

Toyota Motor Corporation will partner Mazda Motor Corporation and auto parts supplier Denso Corporation to form a joint venture for developing electric vehicles, as Japan’s biggest automaker plays catch up in the expanding race for battery driven cars.

The new company, called EV Common Architecture Spirit Co., will cooperate on the developing the architecture and components of electric cars for use in a wide range of segments, from mini-vehicles and SUVs to light trucks, the companies said on Thursday, the Nation news website reported.

The deal will create a toolbox of components that both Toyota and Mazda can dip into when making their own electric vehicles. The deal builds on a fledgling alliance between the country’s largest automaker and one of its smallest that was cemented in August.

The companies announced a capital tie up then, saying they would work together in a variety of fields, including electric cars.

Toyota Executive Vice President Shigeki Terashi said then that sharing technology would give Mazda and Toyota extra volume and drive down costs. Terashi was tipped to head the new venture as president.

The companies said increasingly stringent emissions regulations were forcing carmakers worldwide to develop electric vehicles. But the high cost of electric cars, driven partly by their expensive batteries, makes it necessary for erstwhile rivals to pool resources. The new venture, they said, will be open to participation from other automaker and suppliers going forward.

“The huge investments and time required to cover all markets and vehicle segments is a pressing issue for individual automakers,” the companies said. “New regulations that mandate a certain proportion of electric vehicle sales are beginning to emerge,” he said.

 EV Frenzy

The industry’s frenzy for EVs was on full display around this month’s Frankfurt auto show. BMW, Mercedes-Benz and Volkswagen were among the makes rolling out ambitious plans to unleash waves of EVs over the coming years. Jaguar Land Rover weighed in with plans for full electric and hybrid cars from 2020, and Honda unveiled its next EV.

The new Toyota Company will pull select engineers from all three companies and have about 40 employees. It will be based in Toyota’s high-rise office building in downtown Nagoya, Japan.

Toyota will wield disproportional influence. It will hold a 90% stake in EV C.A. Spirit, while Mazda and Denso each take 5%. The two directors under Terashi also come from Toyota. They are Kiyotaka Ise, head of Toyota’s advanced R&D and engineering, and Toshiyuki Mizushima, president of the carmaker’s powertrain sub-company.

Toyota long remained skeptical about EVs in favor of the hybrid technology pioneered by its flagship Prius, as well as the potential for hydrogen fuel cells. But the automaker finally joined the EV race late last year when President Akio Toyoda put himself in charge of a new EV Business Planning Department.

It was envisioned as a flat, fast-moving organization to mimic the nimble corporate culture of the Silicon Valley startups. At its helm were just four people, including Toyoda and counterparts from Toyota Group suppliers Aisin Seiki Co., Denso and Toyota Industries Corp.

That EV planning department will remain, while the new JV incorporate elements of its work and feeds new EV technology back into it.