General Motors Corp. and Isuzu Motors Ltd. have reached an agreement to raise the auto giant's equity stake in Isuzu from 37.5 percent to 49 percent, giving the Japanese truck maker the central role in GM's global commercial vehicle development, the two firms announced Friday in Tokyo.
The two companies will use Isuzu's platforms to integrate vehicle designs and major components for commercial automobiles, including the cab and chassis.
"Today, we are taking another step by using Isuzu's strong position in the commercial vehicle segment as leverage to ensure Isuzu plays an even more important role in GM's global commercial vehicle development and integration process," said GM Chairman and CEO John F. Smith Jr. in a joint press conference in Tokyo.
GM will acquire new Isuzu shares through a third-party allocation, boosting Isuzu's capital from 63.3 billion yen to 89.6 billion yen. Isuzu will issue 232.5 million new shares at 226 yen each, with payment due to be made March 2.
Details of specific projects will be worked out later, but Isuzu Chairman and CEO Kazuhira Seki said the two firms have already decided to let Isuzu develop all trucks as large as and larger than Isuzu's top-selling small truck, Elf, for the entire GM group.
Elf trucks have a loading capacity between 2 and 3 tons.
Seki pointed out that regulations for automobiles differ from country to country, and that the commercial vehicles Isuzu will develop will be decided by the two firms after various studies are completed.