Volvo and Isuzu To Form Truck Alliance

By Mike Osenga19 December 2019

The Volvo Group and Isuzu Motors have announced the signing of a non-binding memorandum of understanding to form a global commercial vehicles alliance.

When finalized, one of the first steps will be to transfer ownership of the UD Trucks business globally from the Volvo Group to Isuzu Motors, “in order to accelerate growth by leveraging greater volumes and complementary capabilities.” Headquartered in Japan, UD Trucks has been a wholly-owned subsidiary of the Volvo Group since 2007.

Before that, the announcement said the scope of the business to be transferred needs to be finalized, as well as due diligence by Isuzu Motors and negotiations of binding agreements. Signing of binding agreements is expected by mid-2020 and closing of the transaction is expected by the end of 2020. All potential transactions will be subject to regulatory and other approvals.

The enterprise value for the complete UD Trucks business is US$ 2.3 billion and will be subject to the final scope of the business transferred and Isuzu Motor’s due diligence.

The alliance is intended to establish a global technology partnership and to create a stronger, combined heavy-duty truck business for Isuzu Motors and UD Trucks in Japan and across international markets. The two groups complement each other, the announcement said, from both a geographical and product line perspective, with further opportunities to be explored over time.

The intended alliance will also include forming a technology partnership, which will leverage the parties’ areas of expertise within both existing and new technologies as well as to create a larger volume base to support necessary, forthcoming technology investments.

Further, the alliance is expected to explore opportunities for broader and deeper collaboration within the commercial vehicle business across geographical areas and product lines, such as light- and medium-duty trucks.

All technology cooperation between the Volvo Group and Isuzu Motors will be managed through individual contracts.


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