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Toyota
said Friday it would discuss strengthening its partnership with Mazda as
reports said they were close to a deal on a capital tie-up and building a $1.6
billion factory in the United States.
The
move comes as the Japanese auto industry is facing uncertainty over President
Donald Trump’s drive to support US firms over foreign imports.
He had
earlier strongly criticised Toyota over its ongoing project to build a new
factory in Mexico, threatening it with painful tariffs.
Shares
in Mazda, which has no US plant, soared more than five percent in Tokyo trade
early Friday while Toyota was marginally lower.
Toyota
said it would discuss its partnership with the Hiroshima-based company at a
board meeting later in the day.
“In May
2015, Toyota and Mazda signed a memorandum of understanding to explore various
areas of collaboration,” Toyota said in a statement.
“We intend to submit a
proposal to our board of directors today regarding the partnership with Mazda,”
it said while withholding further details.
Mazda issued a similar statement.
The Nikkei daily reported the two firms were closing in on a
capital partnership to pave the way for the possible establishment of a
joint-venture US auto plant and joint development of key electric vehicle
technologies.
They were negotiating a deal in which Toyota would take a
roughly five percent stake in Mazda, which in turn would invest in the other
party as well, the leading business daily said.
Bloomberg News reported the two were considering a deal to have
cross-shareholdings and build a $1.6 billion assembly plant in the United
States.
The US plant would have the capacity to produce 300,000 vehicles
a year and create 4,000 jobs, Bloomberg quoted people familiar with the matter
as saying.
It would be operational by 2021, it said.