Isuzu in talks with GM about jointly selling commercial vehicles

Article by Christian A., on May 2, 2012

Negotiations will soon begin between General Motors Co. and Isuzu Motors Ltd. about jointly selling commercial vehicles in Asia and in Central and South America, according to a Nikkei business daily report. Under this proposed deal, Gm will take a 10% stake in Isuzu. If this deal pushes through, it would restore a 35-year capital alliance that was thrown out during GM's 2006 restructuring.

As a result, Toyota Motor Corp. may be encouraged to sell its 5.9% stake in Isuzu since the GM link-up would rival its own reputable markets in Asia. The Nikkei report also said that Issue will stop talks with Volkswagen AG about a capital tie-up.

However, it will continue talks on supplying pickup trucks to Volkswagen in Thailand. GM and Isuzu are expected to begin talks in early May. It’s likely that during a meeting to be attended by Isuzu President Susumu Hosoi and GM CEO Dan Akerson this summer, an agreement would already be signed.

The paper said that the two automakers are thinking about jointly developing pickup trucks and joint production and distribution plants in Southeast Asia.

If GM gets the 10% stake, it will become the biggest Isuzu shareholder, getting past trading house Mitsubishi Corp., which owns a 9.2% stake. The two companies will also be discussing the possibility of lifting GM's stake size in the future. However, Isuzu may decide not to pursue a stake sale to maintain its independence in management and development.

Topics: isuzu, gm

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