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BMW and Toyota expand partnership

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BMW and Toyota expand partnership Empty BMW and Toyota expand partnership

Post  prostar Sun Jul 01, 2012 1:46 am

BMW and Toyota agreed to deepen a partnership agreed last year, co-operating on hydrogen fuel cells, vehicle electrification, lightweight materials and a future sports car.

The German and Japanese carmakers made the announcement on Friday in Munich after signing an agreement on what they described as a "long-term, strategic collaboration".

The deal is not a close alliance of the type agreed between General Motors and PSA Peugeot Citroën in February, or Renault/ Nissan and Daimler in 2010, but it does mark a significant broadening of a co-operation agreement between the two traditionally independent companies.

In December of last year BMW agreed to supply Toyota with 1.6 litre and 2.0 litre diesel engines to Toyota's European vehicles beginning in 2014.

In March the two companies signed a binding agreement to work together on developing next-generation lithium-ion cells for the batteries used in hybrid and electric cars.

"BMW and Toyota both want to make ever better cars," Akio Toyoda, Toyota's chief executive, said at a media briefing on Friday. "We respect each other; that is why we can already take the next step together."

Toyota has been an industry leader in hybrid cars, and is one of the carmakers leading an industry push to develop hydrogen-powered cars.

However, it has been weaker than many of its mass-market competitors in Europe, where it is overhauling its product offering and seeking to raise its game on design.

The Japanese company said that it was looking to tap into BMW's expertise in making sports cars. "I am sure working with BMW will enhance Toyota's ability to make ever better cars," Mr Toyoda said.

Norbert Reithofer, BMW's chief executive, said the car industry faced "new and different challenges" from changing technology and consumer preferences.

"Together we have a great opportunity to continue leading our industry through this transformation," he said. "That is why we are pooling our expertise."

BMW's controlling Quandt family shareholders have shunned capital tie-ups with rival automakers.

However, BMW has partnerships with other manufacturers including Peugeot, which supplies it with small diesel engines and with which it agreed last year to produce components for hybrid and electric cars.

"For the BMW group, strategic partnerships are part of our strategy," Mr Reithofer said.

The co-operation with Toyota, he added, met the company's three criteria for such partnerships: it was based on "mutual trust and commitment", created a win-win situation and allowed the Munich group to maintain the independence of its brands.

A BMW spokesman said the German carmaker had opened talks with Peugeot about possibly discontinuing their 50:50 joint venture in light of the French group's new alliance with GM. However, he added, their co-operation on diesel engines would remain unaffected.

Analysts said the combination of the industry's top-selling premium and mass-market carmakers could be a powerful force in areas such as lightweight carbon fibre, an emerging technology where BMW is competing fiercely with its bigger rival Volkswagen.

"These two as a pair are potentially much more of a threat to VW, Daimler and the others than loose co-operations with smaller players," said Arndt Ellinghorst, head of European automotive research with Credit Suisse.

Partnership agreements between competing carmakers are becoming increasingly common in the industry as manufacturers seek to pool efforts on costly technologies.

BMW and Toyota expand partnership Toyota-car
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