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Toyota to boost its Subaru stake to more than 20%

TOKYO — Toyota Motor Corp plans to raise its stake in Subaru Corp to more than 20% from around 17% now, a deal that would also see the smaller firm invest in Japan's top automaker, two people with direct knowledge of the matter said on Friday. The deal is due to be approved at a Toyota board meeting on Friday, the people said, declining to be identified because the information has not been made public. The investment would come a month after Toyota and another smaller Japanese automaker, Suzuki, said they would take small equity stakes in each other. Such tie-ups highlight how automakers are scrambling to chase scale, manage costs and boost development. Traditional car makers, especially smaller ones like Subaru and Suzuki, are struggling to meet the fast pace of change in an industry being transformed by the rise of electric vehicles, ride hailing and autonomous driving. Toyota's investment is likely to cost more than 70 billion yen ($650 million) based on Subaru's stock market value, said the Nikkei business daily, which first reported the news. Subaru is likely to reciprocate with a stake in Toyota that would roughly equal the value of Toyota's additional investment, one of the people told Reuters. The companies have long worked together on projects such as the Toyota 86 and Subaru BRZ twins. At one time, Subaru built Toyota Camrys in its Indiana plant. Representatives for both Toyota and Subaru said the news was not something that had been announced by their companies. "The plan appears to be to ultimately make Subaru a fully owned subsidiary, to help create a 'mega Toyota.' This is the first step towards that," said Takeshi Miyao, managing director of Carnorama, a consultancy. "It's all about building scale." Subaru is particularly strong in sport-utility vehicles (SUV) and all-wheel-drive technology. The two automakers in June said they planned to jointly develop an electric sport-utility vehicle on a platform produced together, to split costs. Car markers around the world have been joining forces to slash development and manufacturing costs of new technology. Ford Motor Co and Volkswagen AG have said they will spend billions of dollars to jointly develop electric and self-driving vehicles. Toyota seems to be particularly keen to build scale now by investing in smaller, domestic automakers, rather than forging cross-border tie-ups like some of its rivals.

Tesla expects another higher-volume deal with Toyota in next few years

Four months have passed since Toyota ended its relationship with Tesla Motors, in which the electric-vehicle specialist supplied full lithium-ion battery packs to the Japanese behemoth for its RAV4 EV rollout, of which 2,500 vehicles will be completed. Now, Tesla founder and CEO Elon Musk has been heard suggesting that a future collaboration is likely within the next two to three years, and that it will probably be much larger than the last one.
Both Tesla and Toyota have sung each other's praises in the not-too-distant past, Toyota telling Autoblog back in May, "We have a good relationship with Tesla and will evaluate the feasibility of working together on future projects." According to Automotive News, Musk said of the Japanese giant, "We love working with Toyota... We have a huge amount of respect for them as a company and certainly much to learn."
Interestingly, though, the two automakers have rather divergent strategies for eco-friendly automobiles. Toyota, as you're surely aware, is the clear-cut leader in hybrids and has thrown its massive support in the direction of hydrogen fuel cells, while Tesla has invested heavily in battery-electric technology and high-speed charging stations.

Toyota Yaris iA, Mazda CX-3 sales show crossover formula isn't an automatic win

While 2017 was another watershed year for crossovers, in one interesting case, a crossover had its lunch eaten by its sedan counterpart. In the past year, Toyota sold nearly 36,000 Yaris iAs, a sedan that is identical to the foreign-market Mazda2 in everything but Toyota's ugly front bumper. In the same time frame, Mazda sold just over 16,000 CX-3s, a subcompact crossover based on the Mazda2. Not only that, but the Yaris iA saw an increase of around 8,000 units over 2016, and the CX-3 sold about 2,000 fewer units than in 2016. View 29 Photos There are a few reasons this is surprising. First of course is that the crossover market is surface-of-the-sun hot right now, so much so that primarily crossover-building brand Subaru saw its best sales year ever last year. Even Mazda's other crossovers, the CX-5 and CX-9 saw better sales in 2017 than in 2016. But on paper, the CX-3 has a number of advantages compared to the Yaris iA. The CX-3 has a larger 2.0-liter four-cylinder that makes about 40 more horsepower than the 1.5-liter engine in the Toyota. Also, while the cargo area behind the rear seats in the CX-3 is about one cubic foot smaller than the iA, it has the added flexibility of being a hatchback, and thus having more capability when it comes to large, bulky items. And of course, the CX-3 is quite a shapely machine compared with the awkward, angry-looking iA. That's not to say the iA doesn't have any of its own advantages. It gets 3 more mpg in the city and 6 more on the highway than the CX-3. It also costs roughly $3,000 to $4,000 less than a CX-3 and can be found at more dealers than the Mazda. But it's still surprising that a car, especially a sedan, can outsell a mechanically very similar crossover. Apparently the formula of adding more ground clearance and plastic fenders isn't foolproof. Then again, maybe it's not such a big deal to Mazda, since the CX-3's total sales were just over a tenth that of the Mazda CX-5. Related Video: