The declining costs of battery technology is heating up the race to place electric vehicles on the consumer market by 2020.
In efforts aimed at shortening the lead between its rival and itself, Toyota Motor Corp has establishing a new venture to develop electric vehicle technology with partner Mazda Motor Corp.
Policymakers across the globe are pushing to shift to electrical vehicles pressuring traditional automakers to ramp up this plans on putting EVs on the road by 2020. The declining costs of batteries are also playing a significant role.
In its statement, Toyota said its new company will develop technology for a range of EVs, including SUVs, light trucks, mini-vehicles and passenger cars.
The joint venture will see Toyota having a 90% stake while Mazda and Denso Corp, Toyota’s biggest supplier, will each have 5% each.
This development builds on an earlier partnership that was announced in August with Toyota agreeing to buy a 5% stake in Mazda, with the two companies agreeing to jointly develop affordable electric vehicle technologies.
Toyota is playing catch up since it had placed its bets on hydrogen fuel cell technology.
Only last year, it set up a division to develop EVs led by the company’s president Akio Toyoda. Toyota plans on introducing its EVs in China in the coming years.
Incidentally, neither Toyota nor Mazda have a full electric passenger cars in their product baskets.
With Mazda’s research budget being a fraction of Toyota’s, it was facing strong headwinds to develop EVs on its own.