BMW, Toyota team up on diesels, batteries
Photo credit: LINDSAY CHAPPELL
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TOKYO -- Toyota Motor Corp. and BMW AG have worked out a technology-sharing agreement involving diesel engines and advanced hybrid and electric-vehicle batteries in a deal that mimics one that links their two closest rivals.
Additional technologies are also under discussion by the companies, said Takeshi Uchiyamada, Toyota's executive vice president for global r&d.
Under the agreement, unveiled at a press conference on the sidelines of the Tokyo Motor Show, BMW will supply Toyota with small-displacement clean-diesel engines to use in vehicles sold in Europe starting in 2014. In return, Toyota will work with BMW to produce next-generation lithium ion batteries for hybrid vehicles to be used by both companies at an undisclosed date.
Uchiyamada declined to specify how long he expects the duo to take to develop a lithium ion battery that would surpass what is already on the market.
"We think that this collaboration will allow for development of next-generation batteries to be done faster and to a higher level," he said.
"German manufacturers have accumulated a great deal of excellent fundamental technology in regard to renewable energies and battery power. BMW is a good example of German attainment in those technological sectors," Uchiyamada said.
Nissan-Daimler deal
The new partners' two closest competitors, Nissan Motor Co. and Daimler AG, have been cooperating for the past year under a similar global technology-sharing deal.
In that hook-up, Nissan intends to supply Daimler with the next-generation Smart car, and Daimler will supply Nissan's luxury Infiniti brand with four- and six-cylinder diesel engines to market in Europe. The two are also jointly developing a vehicle that will sell as a small Infiniti model in North America.
Didier Leroy, CEO of Toyota Motor Europe, said at the Tokyo press conference that BMW will supply 1.6- and 2.0-liter clean-diesel engines for use on a number of Toyota models that he would not identify. But he said the BMW engines would first be used in a model that Toyota builds in Europe.
BMW CEO Norbert Reithofer said in a statement that supplying diesel engines to Toyota is another step in BMW's plans to expand sales of its engines and powertrain systems.
The diesel tie-up with BMW represents a reversal in Toyota's strategy. After Toyota scrapped plans two years ago to develop 1.6-liter diesel engines with Japanese truckmaker Isuzu Motors Ltd., in which it owns a 5.9 percent stake, President Akio Toyoda said the company would shift its focus in Europe to hybrids and away from diesel so as not to get "lost in the crowd."
But Toyota has lost market share in Europe, partly because of a dearth of diesel cars, which make up more than half of new-vehicle sales in the region. Diesel engines use less fuel and emit less carbon dioxide than gasoline engines.
Hybrid technology has struggled to gain traction in Europe.
Faster development
Diesel engines are a necessity for European consumers, but the engines are scarce for most brands in the United States.
Klaus Draeger, BMW board member for development, said that BMW hopes to help Toyota speed up the development of next-generation lithium ion batteries.
"It clearly makes sense for experienced and innovative companies to pool their expertise and power with such future-orientated technologies," Draeger said. "Toyota and the BMW Group are perfect partners. Toyota is the most sustainable and experienced producer in the high-volume segment. And Japan, of course, is the country that has made hybrid cars well-known around the globe."
Also like the Nissan-Daimler partnership, Toyota and BMW say they are looking at other possible areas of sharing. Neither side specified what those might include, although Uchiyamada addressed the question in a prepared text that indicated Toyota seeks to learn from BMW's corporate culture.
"We have always thought there is a lot to learn from Europe's automotive culture and from the European tradition of automotive engineering," Uchiyamada said. "BMW is a premium brand that represents that culture and tradition, and we hope to learn a great deal through this mid-to-long term collaboration."
Paul McVeigh contributed to this report
You can reach Lindsay Chappell at lchappell@crain.com.
