https://www.engineeringnews.co.za
Africa|Business|Electrical|Logistics|Motors|Service|Technology|Trucks|Products|Solutions|Operations
Africa|Business|Electrical|Logistics|Motors|Service|Technology|Trucks|Products|Solutions|Operations
africa|business|electrical|logistics|motors|service|technology|trucks|products|solutions|operations

Volvo sells UD Trucks to Isuzu as part of alliance deal, impact in SA unclear

3rd November 2020

By: Irma Venter

Creamer Media Senior Deputy Editor

     

Font size: - +

Sweden’s Volvo Group and Japan’s Isuzu Motors have agreed to form a strategic alliance within the commercial vehicle sector, in accordance with a memorandum of understanding signed in 2019. 

The agreement includes Isuzu Motors’ acquisition of UD Trucks from the Volvo Group for 243-billion yen.

The transaction is subject to certain conditions, including approval from regulatory authorities.

The truck makers say the alliance aims to build a long-term relationship that will encompass a technology partnership intended to leverage complementary areas of expertise within known and new technologies, and to create a larger volume base in order to support technology investments.

The technology partnership encompasses the joint development by Isuzu Motors and UD Trucks of common platforms for medium heavy-duty truck models for the Japanese and other Asian markets, using, among others, Volvo Group technology. 

It also includes cooperation regarding new technologies such as autonomous driving, connectivity and medium- and heavy-duty electrical vehicles.

The deal between the two truck makers will also aim “to create the best long-term conditions for a stronger heavy-duty truck business” for UD Trucks and Isuzu Motors in Japan and across international markets, by transferring ownership of the complete UD Trucks business from the Volvo Group to Isuzu Motors. 

“This will accelerate growth by leveraging greater volumes and complementary capabilities, creating significant synergies for Isuzu Motors,” says a statement on the deal.

As a first step in this acquisition process, Isuzu Motors and UD Trucks are discussing the conditions for the supply of certain truck variants from UD Trucks to Isuzu Motors from 2022 onwards.

The Volvo-Isuzu deal will also explore further opportunities “for even broader and deeper collaboration” within the two truck makers’ commercial vehicle businesses across geographical areas and product lines for future urban logistics solutions. 

Isuzu Motors is regarded as one of the world leaders in the 3.5 t to 15 t light and medium-duty truck segment, with sales volumes of 252 000 units in 2019.   

The alliance agreement will explore cooperation in the areas of purchasing and logistics.

In order to execute the agreement, the Volvo Group and Isuzu Motors will establish a joint alliance office, with facilities both in Japan and Sweden, which will be overseen by an alliance board comprising the Isuzu Motors president, the Volvo Group CEO and other key executives from the two groups. 

The two companies have signed an alliance framework agreement for a minimum duration of 20 years.

“I have high expectations for this strategic alliance, which will make Volvo and Isuzu Motors even more competitive within their respective markets and segments,” says Volvo Group president and CEO Martin Lundstedt.

“This is an opportunity to share technology investments and also to help each other grow. I am confident that UD Trucks will become a bridge between the Volvo Group and Isuzu Motors and that the strategic alliance will create the conditions to continue to develop UD Trucks to a new level within Isuzu Motors.”

“The difficult and unforeseeable Covid-19 situation has made th[is] strategic alliance even more valuable and has built a solid, trustful relationship between Isuzu and the Volvo Group,” adds Isuzu Motors president Masanori Katayama.

“This long-term partnership will span across products, technologies and regions, and actively contribute to service improvements and strengthened customer satisfaction, as well as supporting the logistics industry. 

“I am fortunate to have UD Trucks joining the Isuzu Group. UD Trucks will play an important role in the strategic alliance for efficient and effective collaboration between Isuzu Motors and the Volvo Group.”

What Will Happen in South Africa?
It is not yet clear what the effect of the agreement, including the sale of UD Trucks, will have on the operations of Isuzu, UD Trucks and the Volvo Group in South Africa.

All three groups have their own truck assembly plants in South Africa in Port Elizabeth, Pretoria and Durban, respectively.

“It would be premature at this stage to speculate on the impact of this development on our South African operations,” says Isuzu Motors South Africa spokesperson Denise van Huyssteen.

 

 

Edited by Creamer Media Reporter

Comments

Array

Showroom

Magni SA
Magni SA

Magni SA is committed to developing the safest Telehandlers available to our customers for underground and surface mining, construction, forestry,...

VISIT SHOWROOM 
M and J Mining
M and J Mining

M and J Mining are leading suppliers of physical support systems as used by the underground mining industry. Our selection of products are not...

VISIT SHOWROOM 

Latest Multimedia

sponsored by

Option 1 (equivalent of R125 a month):

Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format

Option 2 (equivalent of R375 a month):

All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.

Already a subscriber?

Forgotten your password?

MAGAZINE & ONLINE

SUBSCRIBE

RESEARCH CHANNEL AFRICA

SUBSCRIBE

CORPORATE PACKAGES

CLICK FOR A QUOTATION







sq:0.17 0.233s - 164pq - 2rq
Subscribe Now