Toyota Motor Corp. announced that it is setting up a new venture with Mazda Motor Corp. and automotive supplier Denso Corp. that will be called EV C.A. Spirit Corp., to develop electric vehicle technology. Toyota will take a 90% stake, while Denso and Mazda will each take a 5% stake in the new company that will be based in Nagoya, Japan.  EV C.A. Spirit Corp. will help create a common architecture for fully electric powertrains that can be used in a wide range of vehicles, from mini-vehicles to passenger vehicles, sport utility vehicles (SUVs) and light trucks.

The new venture aims to innovate the development process by combining the strengths of each company, including Mazda’s bundled product planning and prowess in computer modeling-based development, Denso’s electronics technologies and the Toyota New Global Architecture (TNGA) platform.

Last month, Toyota and Mazda, which formed an alliance in 2015, announced plans to jointly build a USD1.6 billion plant in the United States. Denso is a Toyota affiliate, in which Toyota directly owns 25%.

“As countries and regions around the world adopt increasingly stringent policies to help reduce greenhouse gases, new regulations that mandate a certain proportion of electric vehicle sales are beginning to emerge,” Toyota said in a statement.

“Complying with these environmental regulations, while ensuring the sustainable growth of our companies, requires the development of a wide range of powertrains and technologies. We regard electric vehicles (EVs) as a key technological field in this process alongside fuel cell vehicles.”

However, electric vehicles yet have to find widespread market acceptance and huge investments and time will be required to cover all markets and vehicle segments, Toyota said.

Mazda, Denso and Toyota will jointly develop basic structural technologies for EVs capable of covering a wide variety of vehicle segments and types to ensure flexible and rapid response to market trends. The new company will engage in the following:

1. Research into the characteristics (common architecture) that define optimum performance and functions of EVs from the standpoint of both individual components and the whole vehicle;
2. Verification of component installation and vehicle performance realised by the characteristics achieved in item 1;
3. Examination of the optimum concept for each car classification with regard to each component and each type of vehicle realized by achieving items 1 and 2.

Through this joint technological development project, by dedicating an equal amount of development resources, ensuring efficient development processes, and taking advantage of existing production facilities, Mazda and Toyota intend to focus their resources on fundamental vehicle values to enable the creation of appealing EVs that embody the unique identities of each brand and avoid the commoditisation of EVs.

The companies also aim to create a business structure that is open to participation by other automakers and suppliers.