Report: Toyota denies possible GM alliance Is the Japanese automaker looking at possibly hooking up with GM, or isn't it? NEW YORK (CNNMoney.com) -- Toyota is not interested in exploring its own alliance with General Motors as a way to try block a potential GM-Nissan-Renault tie-up, according to a published report. The Detroit News quoted an unnamed top Toyota executive based in the United States as saying there was no truth to the Business Week report that Toyota (Charts) is interested in a possible deal of its own with troubled U.S. automaker GM (Charts).
"They haven't approached us, and we haven't approached them," the Toyota executive told the News. Sunday, after Business Week posted its report on its Web site, GM spokeswoman Toni Simonetti told CNNMoney.com the report was "speculative" and said GM has not been approached by anyone from Toyota regarding working together beyond what the companies are already doing. Business Week magazine, quoting people with knowledge of the Japanese automaker's plans, said the company is mulling its options and considering different plans that could be proposed to General Motors (Charts), the world's largest but financially imperiled automaker. The Business Week story quoted one Toyota (Charts) source saying that the company has "war-gamed" a way to help GM. Despite its rapid growth, much of that at the expense of General Motors, Toyota is concerned about the political and social backlash if GM falls apart. But the News report Monday quoted the Toyota executive as saying "We haven't war-gamed how to help GM. 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. Toyota has been reluctant to make acquisitions of other automakers or even enter into alliance. Even the Business Week report said that an equity link, where Toyota and GM would buy stakes in each other, was unlikely. Nissan-Renault own controlling stakes in one another and even share a CEO, Carlos Ghosn. Ghosn told CNNMoney last week he would like any alliance with GM also to include cross ownership. Toyota and GM already have ties David Cole, head of the Center for Automotive Research, said Sunday that he wouldn't be surprised if Toyota was interested in more links with GM, as well as in blocking a GM-Nissan-Renault alliance. "It depends on the nature of the agreement, what the consideration is on both sides," said Cole. "I know the GM people have high regard for Toyota, and that Toyota people also have high regard for GM." But Cole noted that it wasn't likely Toyota would make any broad move quickly. "Toyota moves very slowly with any kind of alliances," he said. "For Toyota, the foundation for whatever they do is already having a very deep relationship with the other company. But a closer partnership with GM would not be a difficult thing because they have a pretty good working relationship already." The two companies have been successful with a joint venture in California, a plant that makes the Pontiac Vibe, the Toyota Corolla and Toyota Tundra pickup. Last year it made 417,505 vehicles, with about 45 percent going to GM and the rest to Toyota. The plant has 5,400 employees and has made a total of 6.2 million vehicles from its opening in late 1984 to the end of 2005. In addition Toyota and GM have research and development partnerships, working together on technology not yet ready for use in autos, such as on fuel cells that could someday power cars. Toyota would consider expanding cooperative projects with GM, if asked, the News quoted the Toyota executive as saying. But he said that would be in the context of the companies' existing relationship. Nissan-Renault talks move ahead These reports comes after Ghosn and GM CEO Rick Wagoner met Friday to discuss a possible alliance. Afterwards, the two companies issued a joint statement that they will work over the next 90 days on a confidential review of the potential benefits of an alliance. The statement referred to Friday's meeting as an "exploratory discussion" about a possible alliance. (Full story). The Wall Street Journal reported Monday that the GM board is set to meet Monday about the talks on Friday. The alliance between GM and Nissan-Renault was first suggested by Kirk Kerkorian, GM's largest individual shareholder who owns a 9.9 percent stake. A number of industry analysts said Friday they think that a GM-Nissan-Renault alliance was unlikely. But they also said there are risks for GM in just holding talks with its potential partners, no matter what direction they go. (Full story). GM, the world's largest automaker, is already taking steps to get back on track after it lost $10.6 billion last year. The company is cutting 30,000 hourly workers, closing a dozen plants and facilities and selling a stake in its GMAC finance unit. But perhaps the biggest challenge facing GM is its need to develop new cars and light trucks that will attract buyers without resorting to big incentives. GM has seen its share of the U.S. market slide in recent years, as overseas automakers like Toyota, Honda and Nissan have gained. Some kind of broader pact with Toyota could prove attractive to Wagoner, GM's CEO, as a possible foil to Ghosn and his two automakers. Other analysts are skeptical about GM's enthusiasm for an alliance with Nissan and Renault. "GM is a company that wants to get past this blind date they were set up on by Uncle Kirk and concentrate on their turnaround plan," Kevin Tynan, auto analyst for Argus Research, told CNNMoney.com Friday. "There's obviously a myriad of issues there for them to concentrate on, and there's a lot more potential there [in the internal issues] than in an alliance," Tynan said. Meanwhile, Ghosn said last week he doesn't want the top job at GM even if an alliance is struck between GM and Nissan-Renault. (Full story). Ghosn, 52, was executive vice president of Renault for just over two years when he was named chief operating officer of Nissan in June 1999 at the start of the Nissan-Renault alliance. He was named CEO of Nissan two years later and is widely credited with pulling the automaker back from the brink of bankruptcy. He was named Renault CEO in April 2005. -- CNNMoney.com's Peter Valdes-Dapena contributed to this report. Related: More trouble for Detroit Related: GM running out of gas |
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