Why Toyota Wants to Merge With its Rival, Mazda

Toyota plans to push its research, development and production teams to move faster and for this reason, since few weeks ago, this company took control of 5 percent of its rival company, Mazda.

Khodrocar – 3 Years ago, Akio Toyoda (Toyota’s CEO) went to the Mazda factory in southern Japan along with a team of specialists to test two of Mazda and Toyota products. These two cars were Toyota Prius and Mazda 3 (Mazda used Toyota hybrid engine license to produce this model). Less than a year, in May 2015, executives of the two companies announced their "thriving partnerships" at a press conference.

Last August, as a result of this partnership, they jointly constructed a factory in the United States. Now Toyota, with 360,000 manpower and an annual production capacity of 10 million vehicles, owns 5% of the Mazda's stock, which produced 1.5 million vehicles last year.

Mazda’s CEO said about the idea of merging: "We are a small company, but Toyota wants to know how we managed to develop different models.” Also Mazda’s Research and Development Manager said: "Between 2012 to 2017, our company was able to create 5 different models.

What’s Toyota’s idea really?

Akio Toyoda was able to make benefit from its grandfather's 80-year-old empire and survived after the 2008 and 2009 financial crisis, and now Toyota is the world's largest automaker right after Volkswagen and General Motors. So, it is logical for Toyota’s CEO to always be concerned about his company’s future. According to one of former Toyota managers, Toyoda is always concerned about the evolutions of automotive industry.

For many years, Toyota, like many other Japanese companies, is concerned about not being able to compete in this evolution of electric vehicles with other automakers. In a market, which Tesla, Google and Uber are playing an important role, Toyota wants to use new methods to solve the existing solutions, so they are able to expand their new models more quickly.

In Toyoda’s opinion, Mazda is not as obsessed as Toyota, therefore he will offer bolder plans.

Mazda CEO emphasized: "Like Hiroshima, we always have a fighting spirit inside ourselves.”

Khodrocar reporter: Golnoosh MohebbAli

Khodrocar translator: Maziyar Jafarieh