TOYOTA, MAZDA, DENSO JOIN FORCES FOR EV DEVELOPMENT

Toyota Motor Corp is setting up a new venture with Mazda Motor Corp. and Denso to develop electric vehicle technology for what has become a worldwide race to develop electric vehicles to meet demands for cleaner air.

On September 28, 2017 all three signed an agreement to jointly develop basic structural technologies for electric vehicles. The three companies have also decided to establish a new company consisting of selected engineers from the three companies to ensure the efficient implementation of the joint technological development projects.

As countries  around the world adopt increasingly stringent policies to help reduce greenhouse gases, 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. All three companies regard electric vehicles (EVs) as a key technological field in this process alongside fuel cell vehicles.

Toyota is putting up 90% of the capital for the new venture, EV C.A. Spirit Co. Ltd. Denso and Mazda will put 5% each. The new venture according to the team will be based in Nagoya, Toyota’s home base in Japan.

The venture will be staffed by selected engineers from the three companies to ensure the efficient implementation of the joint technological development projects, according to a statement released by Toyota.

This comes soon after the August announcement that Toyota agreed to take a 5% stake in Mazda and the two companies agreed to jointly develop  electric vehicle technologies and build a new assembly plant in the U.S. dedicated to produce electric vehicles.

Toyota and Mazda have agreed they will also set up a new, $1.6 billion assembly plant in the United States that will create up to 4,000 new jobs. Toyota already operates a broad network of factories in the U.S. Mazda years past with  another joint venture worked with Ford at an exceptional factory in Romulus, Michigan building alongside Mustangs.

 

Toyota President Akio Toyota and his Mazda counterpart Kogai announce their alliance, which is separate from this new JV with Denso.

“The greatest fruit of our partnership with Mazda is that we have found a new partner who truly loves cars,” said Toyota President Akio Toyoda. “It has also sparked Toyota’s competitive spirit, increasing our sense of not wanting to be bested by Mazda.”

Mazda President and CEO Masamichi Kogai said, “Nothing would please me more than if, through this alliance, we can help to energize the auto industry and create more car fans by bringing together two competitive spirits to spur each other on, leading to innovations and fostering talent and leaders.”

Toyota has only just gotten serious about advanced battery power with the Prius Prime. It seems that all manufacturers and suppliers are setting up joint ventures to produce batteries that will be lighter and offer greater range.  We have seen five joint ventures set up to develop the “best” batteries and charging systems for today’s vehicles.  Many firms are developing charging systems to be part of the infrastructure needed to get the public asking for EV’s.

Their alliance will be far reaching and will see Toyota acquire a minimum 5% stake in Mazda. Mazda may also take a small position in Toyota for this venture.

Along with the new factory, they will expand an existing product partnership that has Mazda now supplying the bigger Japanese maker with a compact sedan for the North American market. Toyota will began producing a new “two-box van” for sale by Mazda in Japan.

“The industry pace of electrification has really picked up,” said Toyota Chairman Takeshi Uchiyamada, the man widely credited with the development of the popular Toyota Prius hybrid.

“As countries and regions around the world adopt increasingly stringent policies to help reduce greenhouse gases, new regulations that mandate a certain proportion of electric vehicle sales are beginning to emerge,” the statement said.

“Complying with these environmental regulations, while ensuring the sustainable growth of our companies, requires the development of a wide range of power trains and technologies. We regard electric vehicles as a key technological field in this process alongside fuel cell vehicles.”

The auto industry has been working to develop EV’s after authorities in China state that they are preparing to outlaw the gasoline engine by 2040. China’s move follows similar moves by Great Britain, India and France and others.

If it was not for Chinese and other countries stringent future present and future rules on internal combustion engine use we would not see all the manufacturers rushing to built the best EV’s and batteries.

The biggest problem world wide is getting the public to embrace EV’s.  Tessla, Chevy Bolt and Toyota are doing a good job. Audi, VW , Ford and others including Mercedes have some amazing vehicles presently.

The three companies in the Joint Venture see that  huge investments and time required to cover all markets and vehicle segments is a pressing issue for individual automakers when responding to the widely varying demand for vehicles around the world. China is catering to all manufacturers to build EV’s in their country.  In order to do so they are considering easing the business rules that required manufacturers to have joint ventures only with Chinese companies.

Mazda, Denso, and Toyota have decided to jointly develop basic structural technologies for EVs capable of covering a wide variety of vehicle segments and types to ensure flexible and rapid response to market trends. This agreement covers 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, Denso’s electronics technologies, and the Toyota New Global Architecture (TNGA) platform.

The press release states that the new company will engage in the following:

1. Research into the characteristics (common architecture*) that define optimum performance and functions of EVs from the standpoint of both individual components and the whole vehicle.

2. Verification of component installation and vehicle performance realized by the characteristics  achieved in item 1)

3. Examination of the optimum concept for each car classification with regard to each component and each type of vehicle realized by achieving items 1) and 2)

*Common architecture is the basic product design concept for realizing required product performance by distributing those requirements among structural components. Under the concept of a common architecture, the basic structure of each component can be commonized, thereby transcending differences in vehicle class and power. By organizing component characteristics, various products can be developed and produced through the same process.

Through this joint technological development project, by dedicating an equal amount of development resources, ensuring efficient development processes, and taking advantage of existing production facilities, Mazda and Toyota intend to focus their resources on fundamental vehicle values to enable the creation of appealing EVs that embody the unique identities of each brand and avoid the commoditization of EVs.

The companies also aim to create a business structure that is open to participation by other automakers and suppliers.

Outline of New Company

Name	EV C.A. Spirit Co., Ltd.
Location	Midland Square 37F, Meieki 4-7-1, Nakamura, Nagoya
Capital	10 million yen (equity participation = Toyota: 90%, Mazda: 5%, Denso: 5%)
Directors	President: Shigeki Terashi Director: Kiyotaka Ise Director: Toshiyuki Mizushima Auditor: Tatsuro Ueda
Employees	At establishment: approximately 40
Website	http://www.ev-cas.co.jp   (will be live on middle of October)
Contact address	info@ev-cas.co.jp   (will be available on October 1)

BRUCE HUBBARD

BONNIE LYNCH

BRADLEY HUBBARD

AUTO ADVISOR GROUP

EDITED FROM PRESS RELEASES AUGUST/SEPTEMBER 2017