TOKYO (Reuters) - Mazda Motor Corp (7261.T), maker of one of history’s most iconic two-seater convertibles, and Fiat SpA FIA.MI are teaming up to produce a new generation of sports cars to revive their flagging fortunes.
Automakers around the world have been forging partnerships to share the rising burden of research and development as governments tighten environmental and safety regulations, and to lower costs amid stiffer competition.
Japan’s fifth-largest car maker and Fiat have agreed in principle to develop and build two-seater sports cars for their respective Mazda and Alfa Romeo brands based on Mazda’s MX-5 model, the companies said in a statement. The deal does not include a capital tie-up.
Mazda has posted four straight years of losses as it has struggled with a strong yen, which makes its cars less competitive overseas. It builds most of its cars in Japan and exports almost 80 percent of that output.
The car maker is also keen to form project-based partnerships to get back on a revival path after losing its strategic partnership with Ford Motor Co (F.N).
While the deal would not bring significant immediate gains for Mazda, it will be positive long-term, especially if the collaboration deepens, some analysts said.
“I see this as positive news,” said UBS auto analyst Tatsuo Yoshida.
“The MX-5 is an iconic car in Mazda’s line-up, and the lightweight roadster is part of its heritage as a maker of sporty cars. But developing the next iteration for Mazda alone would have been difficult to justify, and this arrangement allows them to do that,” Yoshida added.
The MX-5, which debuted in 1989, was declared the best-selling two-seat convertible sports car in history by the Guinness Book of World Records in 2000.
Fiat has been especially vocal about looking for more automotive alliances, particularly with an Asian partner, after taking control of Chrysler to help it reach global sales of 6 million vehicles in 2014.
Both Mazda and Fiat played down the possibility of an equity alliance, saying their non-binding memorandum of understanding did not involve such talks. The companies will, however, discuss further opportunities to cooperate in Europe, they said in a statement.
The cars under the collaboration will be powered by their respective engines and be built at Mazda’s Hiroshima plant, with production of the Alfa Romeo version due to start in 2015.
The Italian sports car will be sold worldwide, including as the Alfa Spider in the United States to mark the brand’s hotly awaited return to the world’s biggest market for two-seater sports cars, Fiat said.
A final agreement is expected to be signed in the second half of this year, the companies said.
Mazda’s shares jumped as much as 4.7 percent at one point in Tokyo after Japanese public broadcaster NHK reported the tie-up plans before the market closed. Before the announcement, Mazda closed up 0.9 percent, giving up much of the gains in a broad sell-off of exporters as the dollar dipped against the yen.
Shares in Fiat were down 0.7 percent in Milan.
Mazda, the maker of the Mazda3 and other sporty cars, is among the few automakers with no strategic capital alliance after Ford sold down its controlling one-third stake starting in 2008. After a nearly $2 billion share offering earlier this year, Ford’s stake has fallen to a nominal 2 percent.
Some analysts were sceptical the cooperation of this scale with Fiat would do much to fix Mazda’s ills in the short-term.
“The fundamental problem at Mazda is its currency exposure,” JP Morgan auto analyst Kohei Takahashi said. “The tie-up with Fiat won’t do anything to alleviate that.”
Additional reporting by Kentaro Sugiyama in Tokyo, Jennifer Clark in Milan; Editing by Muralikumar Anantharaman