Toyota gets help from Mazda, Denso to play EV catch-up

Mazda will work with Toyota to create a toolbox of parts they each can use for their own EVs.

TOKYO — In a bid to make haste in catching up on electric vehicles, Toyota Motor Corp. is forming a three-way partnership with Mazda Motor Corp. and parts supplier Denso Corp. to develop EVs and their batteries.

The companies said lat week that their new company, called EV C.A. Spirit Co., will develop the architecture and components for vehicle segments from minivehicles to light trucks.

The partnership essentially intends to create a toolbox of components that Toyota and Mazda can dip into when making their own EVs.

The deal builds on a fledgling alliance between Japan’s largest automaker and one of its smallest that was cemented in August.

The tie-up builds on a new alliance between Toyota and Mazda. Above: Toyota CEO Akio Toyoda, left, and Mazda CEO Masamichi Kogai

The companies announced a capital tie-up then, saying they would work together in a variety of fields, including electric cars. Toyota Executive Vice President Shigeki Terashi said at the time that sharing technology would help Mazda and Toyota eke out extra volume and drive down costs.

Terashi was tapped to head the new venture as president.

The companies said increasingly stringent emissions regulations are forcing carmakers worldwide to electrify vehicles. But the high cost of EVs, driven partly by their expensive batteries, is making it necessary for competitors to pool resources. The venture announced last week will be open to participation by other automakers and suppliers, the companies said.

“The huge investments and time required to cover all markets and vehicle segments is a pressing issue for individual automakers,” the companies said in a joint statement. “New regulations that mandate a certain proportion of electric vehicle sales are beginning to emerge.”

The industry’s frenzy for EVs was on full display around the Frankfurt auto show in September. BMW Group, Mercedes-Benz and Volkswagen all rolled out ambitious plans to introduce numerous EVs over the coming years. Jaguar Land Rover weighed in with plans for full electric and hybrid cars starting in 2020, and Japanese rival Honda unveiled its next EV.

The Toyota-Mazda-Denso venture will pull select engineers from all three companies and have about 40 employees. It will be based in Toyota’s high-rise office building in downtown Nagoya, Japan.

But Toyota will hold a 90 percent stake in EV C.A. Spirit, while Mazda and Denso will each take 5 percent. The two directors under Terashi also come from Toyota: Kiyotaka Ise, head of Toyota’s advanced r&d and engineering, and Toshiyuki Mizushima, president of the carmaker’s powertrain subcompany.

Toyota long remained skeptical of EVs in favor of the hybrid technology pioneered by its flagship Prius as well as the potential for hydrogen fuel cells.

But the automaker finally joined the EV race late last year when President Akio Toyoda put himself in charge of a new EV Business Planning Department.

It was envisioned as a fast-moving organization capable of mimicking the nimble corporate culture of Silicon Valley startups. At its helm were just four people: Toyoda and counterparts from Toyota Group suppliers Aisin Seiki Co., Denso and Toyota Industries Corp.

That EV planning department will remain in operation, while the joint venture will incorporate elements of its work and feed new EV technology back into it.

Mazda and Toyota will develop their own EVs off the joint venture’s architecture.

“Each company will be responsible for the development of specific vehicles, and the procurement of parts will be unaffected by which suppliers participate at this fundamental technology development phase,” Toyota spokesman Jean-Yves Jault said. “Each company will have complete freedom to make its own decisions about product development.”