Toyota CEO Akio Toyoda. is soon expected to announce an expanded alliance with BMW.
It’s the era of the automotive alliance and it appears that Toyota and BMW are looking to expand the unlikely partnership they first announced last December.
At that time, BMW announced it would supply diesel engines to the Japanese automaker. Toyota, meanwhile, revealed plans to work with its German counterpart on advanced lithium-ion battery technology. Now, the German magazine Der Spiegel reports, the two makers will announce a much larger range of ventures that could include hybrid technology, fuel cells and vehicle electronics.
That’s a significant shift for both companies, BMW and Toyota traditionally preferring to go it alone rather than team up with erstwhile competitors. But Yoshi Inaba, president and COO of Toyota Motor North America, told TheDetroitBureau.com that a change in strategy was urgently needed because, “No one can handle it all by themselves.”
In decades past manufacturers tended to prefer acquisitions or full-fledged mergers but following the collapse of the ill-fated DaimlerChrysler “merger of equals” the industry has shifted to more limited alliances. Arguably the most successful has been the Renault-Nissan Alliance – which has now been joined by Germany’s Daimler AG.
BMW and Toyota have recently entered into several partnerships of their own. The Japanese maker, for example, also has a limited venture going with Ford.
BMW has been allied with PSA Peugeot Citroen, but that venture may be winding down as the French automaker expands its alliance with General Motors and its Opel subsidiary – leading BMW to seek an alternate source of hybrid know-how. Toyota, with its growing Prius family, is considered the world leader in gas-electric technology.
According to Der Spiegel, both Toyota President Akio Toyoda and BMW CEO Norbert Reithofer will announce the details of their expanded alliance in the near future. Along with hybrids, the two are reportedly looking at fuel cell technology – both BMW and Toyota traditionally being proponents of hydrogen power – and advanced automotive electronics.
Industry observers BMW is in particular need of a partnership, especially if it hopes to amortize the high cost of developing alternative propulsion technologies. The Bavarian marque is expanding its hybrid line-up within the BMW brand while also getting ready to introduce the all-new “i” sub-brand, which will focus on plug-ins and pure battery-electric vehicles.
Even with its size and expertise, Toyota also can use help, especially with more advanced lithium-power. It has been reluctant to use the more advanced batteries, until recently, and is now playing catch-up by, in part, turning to partners such as BMW and the California start-up Tesla Motors. That company is providing the underlying lithium-based drivetrain for Toyota’s new RAV4-EV.