Toyota, Suzuki exploring possible partnership

Both carmakers felt there is need for increased industry cooperation amid a rapidly changing automobile sector

Japan's auto majors- Toyota Motor Corp and Suzuki Motor Corp - have shared their plans to explore a possible partnership, citing technological challenges and their need to keep pace with rising consolidation in the global auto industry.

The announcement comes after Toyota completed a buy-out of mini-vehicle maker Daihatsu Motors earlier this year. The world's largest automaker in 2015 said last week that it will set up an internal company with Daihatsu to focus on emerging markets.

Suzuki, Japan's fourth-largest automaker, also specialises in mini-vehicles and competes fiercely with Daihatsu in the domestic market.

Both Daihatsu and Suzuki manufacture and market cars in emerging Asian countries, with Suzuki dominating the Indian market through its majority stake in Maruti Suzuki India Ltd, while Daihatsu has been expanding in Malaysia and Indonesia through separate joint ventures.

In a joint statement issued by Toyota and Suzuki, it was said that there is need for increased industry cooperation to keep pace with rapid changes in the global auto industry, where automakers and technology companies are competing to develop self-driving cars and new mobility services.

"In addition to the R&D, which each company is working on individually, it is very important now to have partners who share the same goal and passion," Toyota President Akio Toyoda said in a statement.

The two companies said that Suzuki was "increasingly feeling a sense of uncertainty" in the face of rapidly developing new technologies, while Toyota acknowledged it "may be lagging behind in North America and Europe when it comes to the establishment of standardizations and partnership with other companies."

The companies said they would hold a joint briefing on the possible partnership in Tokyo at 0930 GMT. A Toyota spokeswoman declined to give details on the agreement.

Both companies said that they had just begun exploring possibilities for a partnership, and added that they would continue to compete with each other and would be open to collaborating with other companies.

A partnership between Toyota and Suzuki would be the latest development in an already consolidating auto industry. Nissan Motor Co had announced in May that it was planning to take a controlling stake in the embattled Mitsubishi Motors Corp.