By on April 23, 2011

“We have been in contact with Volkswagen for a year and a half,” an Isuzu executive told The Nikkei [sub]. This after rumors of a possible tie-up between Volkswagen and Isuzu at first had been vigorously denied and then spun into an engine deal. We didn’t believe it.

The Nikkei now writes that a capital tie-up is under discussion. The two hope to reach a basic agreement around autumn.  Allegedly, Isuzu has no intention of giving up its independence.

“We have enough strength to consistently earn annual operating profits of 100 billion yen,” an Isuzu official says. That would be $1.2 billion. Toyota is another unknown. They  hold a 5.9 percent interest in Isuzu. Depending on how much Toyota makes out of that interest, possibly Toyota could sell to Volkswagen if the price is right.

Toyota is facing a severe production drop this year. “Toyota’s output in the current fiscal year will drop by 1.5 million units to 2 million units,” Kohei Takahashi, an analyst at JPMorgan Securities Japan Co., said. This will leave deep marks on Toyota’s numbers. Under these circumstances, anything is possible.


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One Comment on “Isuzu And VW Had Been Flirting For Over A Year...”

  • avatar

    All I have to say is: Joe Isuzu commercials – best car commercials ever.
    As far as the important part of the article, the business angle, I am interested to see how this all plays out.

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