The Volvo Group will sell its Japan-based UD Trucks group to Isuzu Motors as a first step in forming a global strategic alliance in commercial vehicles.
The nonbinding memorandum of understanding initiates a period of defining and evaluating the deal, in anticipation of a binding agreement mid-2020 and final deal by the end of the year. Volvo has priced the unit at JPY 250 billion (about $2.9 billion).
“The Volvo Group and Isuzu Motors have a well-established relationship on medium-duty trucks in Japan based on mutual respect, shared values, and win-win spirit,” said Martin Lundstedt, president/CEO of the Volvo Group, in a prepared statement. “We see great potential to extend our cooperation within technology, sales and service as well as other areas going forward, for the benefit of our customers and business partners. Our UD Trucks colleagues have done a great job to improve performance in recent years and the alliance opens up a great opportunity to continue the successful journey.”
Masanori Katayama, resident and representative director of Isuzu Motors Limited, said in a statement:
“Isuzu Motors and the Volvo Group strongly believe in the business opportunities and synergy potential between the two Groups. We intend to derive the full value from each other’s different specialties across product and geographical strongholds. Our collaboration will actively contribute to service improvements and strengthened customer satisfaction as well as to prepare ourselves for the forthcoming logistics revolution.”
What does the Volvo-Isuzu strategic alliance cover?
- Forming a technology partnership, which will leverage the parties’ complementary areas of
- expertise within both well-known and new technologies as well as to create a larger volume
- base to support necessary, forthcoming technology investments.
- Creating the best long-term conditions for a stronger heavy-duty truck business for UD
- Trucks and Isuzu Motors in Japan and across international markets.
- Exploring opportunities for even broader and deeper collaboration within the commercial vehicle business across geographical areas and product lines, such as light-duty trucks and medium-duty trucks.
Source: www.constructionequipment.com
