Local reaction to Volvo and Isuzu alliance: Update

The Australian subsidiaries of the Volvo Group and Isuzu Motors have welcomed the coming together of the two companies which will subsequently mean the movement of UD into the Isuzu fold.

In a media statement, Isuzu Australia said: “The recent announcement of the establishment of a non-binding Memorandum of Understanding with the intent to form a strategic alliance within commercial vehicles between Isuzu Motors and the Volvo Group has been welcomed by Isuzu Australia Limited (IAL).”

The alliance is designed to harness the strengths of both companies in addressing and responding to the vast array of opportunities presented by the ongoing transformation of the commercial vehicle industry.

“We understand that this alliance involves a global technology partnership, the transfer of ownership of the UD Truck business and the exploration of other collaboration opportunities,” commented IAL Director and Chief Operating Officer, Andrew Harbison.

“Both global groups offer a broad range of high-quality, efficient and fit-for-purpose commercial vehicles and we have seen a steady stream of future-focussed technology and product developments from each.

“The potential of this tie-up for the global commercial vehicle landscape is significant,” he said.

“In Australia, our customers benefit from the deep understanding of the road transport industry and comprehensive product strategy of our parent company, Isuzu Motors Limited.

“We then tailor this for the local conditions and our long-term leadership of Australian truck market is an endorsement of this customer-focussed approach.

“We look forward to providing more of what the transport and logistics industries need both now and into the future, and announcements such as this confirm that Isuzu Motors has its sights fixed well into the future also,” Mr Harbison concluded.

The statement went onto say that as an initial step, the intention is 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.

This will entail transferring ownership of the complete UD Trucks business globally from the Volvo Group to Isuzu Motors in order to accelerate growth by leveraging greater volumes and complementary capabilities.

A later statement from Volvo Group Australia added: "The strategic alliance is to entail a technology partnership and there is great complementarity between the two Groups from both a geographical and product line perspective, with further opportunities to be explored over time.

"As part of the strategic alliance, ownership of the complete UD Trucks business globally will be transferred from the Volvo Group to Isuzu Motors. In addition, the Volvo Group and Isuzu Motors have awarded each other private importerships in selected markets, including Australia.

"As part of the intent, nothing will change in the set-up for the Australian market or for our customers in the Australian market. Hence we at Volvo Group Australia will continue to distribute the UD brand and support our UD Trucks Australia customers and dealer business partners."

Whether we see UD Quons rebadged as Isuzu remains to be seen, but we may see the Euro 6 engines from the UD products in Isuzu trucks when our government mandates the cleaner engines.

In June this year, Isuzu announced the strengthening of its drivetrain partnership with Cummins.

We know that Isuzu needs a boost in the medium to heavy-duty arena and this might just be the injection the big Japanese manufacturer needs.