[nadepalma]

Interesting partnership. It makes a lot of sense strategically, but would have thought that Mitsubishi, Suzuki, and Mazda cooperating would have yielded greater synergies and possibility for savings.

I guess this must mean that FCA's hopes of deepening their cooperation with Mazda is now off the table.

Also makes me wonder if Sumitomo will now take a step back from their involvement in Mazda --- if a capital tie up is eventually achieved.

For Japan’s smaller carmakers such as Mazda and Subaru-maker Fuji Heavy Industries, circling wagons with a giant like Toyota can complement their own tiny r&d budgets.

Fuji Heavy, for example, cooperated with Toyota in developing and manufacturing the BRZ sporty coupe, which is sold as the Scion FRS in the U.S. Fuji Heavy also gets minicars for the Japan market from Toyota Group minivehicle-manufacturer Daihatsu.

Toyota also owns a capital stake in Fuji Heavy.

Kogai, keenly aware of his small company’s budget limitations, has made partnering with other carmakers a top priority. Besides producing the upcoming Mazda2-based Scion sedan for Toyota, Mazda will also provide a version of its MX-5 Miata roadster to Fiat. Kogai said the Fiat supply arrangement will continue as planned, as will other partnerships already on the books.

The need for assistance is especially acute at Mazda following it independence from Ford, which had long been Mazda’s sugar daddy, helping defer global r&d costs. While Mazda has said it has no interest in another capital tie-up, such as that with Ford, it still needs plenty of cash.

“The smaller makers in Japan have done extremely well in recent years,” Sanger said. “But looking beyond the next five years, that’s not enough. They have to change what they’re doing.”

All makes a great deal of sense. It almost makes me wonder if Suzuki, Isuzu, and Mitsubishi are also looking at "sugar daddies" (as they all had a corporate "sponsor" of some kind the past).

For Toyota, the deal also gives it a front-row seat to study Mazda.

Toyota engineers say privately that their company has been quietly benchmarking the comparatively tiny Japanese rival, fascinated by its uncanny ability to churn out high-quality vehicles on a shoestring budget -- and to do so profitably from high-cost Japan.

Toyoda said that despite the difference in size between the two companies, Toyota has much to learn from its pint-sized counterpart.

“In a sense, Mazda is ahead of us in many areas,” he said.

Mazda’s high-compression Skyactiv engines, efficient transmission and lightweight chassis systems, as well as its Kodo design language, are prime examples of areas where Mazda leads Toyota by a “full lap,” Toyoda said.

Wow. That's pretty great insight and some incredible praise from Toyoda himself. Makes you wonder if Mazda has something to not only teach Toyota, but if Ford missed out on an opportunity by cutting their ties to their former Asian partners?