Toyota and Suzuki have announced an agreement to form a capital alliance, which will see both companies collaborate in a variety of fields, including autonomous driving technology.

As part of the agreement, the companies plan to acquire each other’s shares, with Toyota saying it will acquire 24 million shares of common stock in Suzuki. This is valued at 96 billion yen, and represents a 4.94% ownership of the total number of shares issued by Suzuki as of March 31, 2019.

Likewise, Suzuki plans to purchase Toyota shares in the market equivalent to 48 billion yen. These share acquisitions will be implemented after both companies obtain approvals from the foreign competition authorities.

A partnership between the two Japanese carmakers was first considered in October 2016, with the companies revealing that specific considerations for the deal were only discussed in March this year. This includes the mutual supply of products by combining Toyota’s electrification technologies with Suzuki’s expertise in compact vehicles.

With the automotive sector undergoing significant changes due to environmental regulations and other factors, the partnership is intended to help both companies strengthen their positions and achieve sustainable growth.