Sunday, July 23, 2006

Toyota not out to derail GM talks

Monday, July 17, 2006
Toyota not out to derail GM talks
Japanese carmaker has no plans to get involved in GM, Renault, Nissan dealings -- for now.
Christine Tierney / The Detroit News

Toyota Motor Corp. is closely watching talks among General Motors Corp., Renault SA and Nissan Motor Co. aimed at forging a three-way alliance, but has no intention of getting involved, said a senior Toyota official.

Toyota and GM have not discussed GM investor Kirk Kerkorian's proposal, disclosed on June 30, to bring the Detroit automaker into the Renault-Nissan alliance, the official said. "They haven't approached us, and we haven't approached them."

GM and Toyota have longstanding relations, and Wagoner is well-liked by Toyota's top managers. The two automakers have shared a manufacturing venture in Fremont, Calif., since 1984, and cooperate on some research. GM recently sold a stake in Fuji Heavy Industries to Toyota for $315 million.

Toyota managers are watching the plight of GM's management, which is being pushed by Kerkorian to consider a deal, as well as the prospect that GM could become part of a mega-alliance that would dwarf Toyota.

But Toyota Chairman Fujio Cho said recently that the company would not get involved, and the Japanese automaker is historically skittish about linking up with other companies.

Toyota would consider expanding cooperative projects with GM, if asked, said the U.S.-based official, who spoke on condition of anonymity. But he said that would be in the context of the companies' existing relationship.

In recent months, GM officials have been baffled by statements coming out of Toyota suggesting that the Japanese giant wants to help GM at the same time it is waging a relentless assault on the U.S. auto market.

"General Motors has not been approached by Toyota," said GM spokeswoman Toni Simonetti.

Toyota managers, ever fearful of a protectionist backlash in the United States, have contemplated the type of role they might play.

But the Toyota official denied reports that the automaker was considering possible ways to thwart a three-way alliance or play the white knight.

"We haven't war-gamed how to help GM," the official said. "We have looked at possible scenarios, what would happen if GM or Ford went into bankruptcy, but we haven't war-gamed how to help GM" in the context of the alliance negotiations.

All automakers are keeping tabs on the negotiations, which began in earnest Friday when GM Chairman and CEO Rick Wagoner and Carlos Ghosn, CEO of Renault and Nissan, met. They laid some ground rules for an initial three-month study of the potential benefits of an alliance.

Renault and Nissan formed a successful partnership in 1999. If GM joined, the automotive alliance would account for nearly a quarter of the global vehicle market.

Toyota is on track to become the world's largest automaker, and industry experts predict it will overtake GM within a few years -- unless Kerkorian's proposal triggers a new round of consolidation in the auto industry.

You can reach Christine Tierney at (313) 222-1463 or

© Copyright 2006 The Detroit News. All rights reserved.


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