Speculation of a Toyota-Ford Alliance Heats Up

Washington DC January 22, 2007; The AIADA newsletter reported that since the heads of Toyota and Ford met in Tokyo in mid-December, speculation that the two may be on their way towards establishing modest, but deeper ties is on the rise, reports Wall Street Journal.

While both sides have stressed that the talks produced no specific deals, people familiar with the matter say both are open to a partnership. According to the Journal, "A Toyota spokesman said no further meeting has been scheduled between the two but stressed that Toyota remains open to the idea of forming a tie-up to share costs of developing new technology or joining hands in popularizing new technology."

An alliance between the two automakers could serve both companies well.

On one side, Ford could benefit from licensing Toyota's industry-leading hybrid powertrain technology and gaining further inroads into the U.S. market for hybrids.

On the other, a tie-up in manufacturing could mean bigger things for Toyota as it looks to ramp up production in the U.S. in order to meet growing demand.