In 2017, February both the companies have made a decision to work together while on yesterday, the agreement has been signed to make the work in progress.
"The agreement stems from the two companies having concluded on February 6 this year an MOU on beginning considerations for business partnership, after which they began discussing, among other topics, the dissemination of vehicle electrification technologies in India", a joint statement said.
We are talking about charging stations for electric vehicles and services to service the batteries.
The companies said Suzuki will produce the electric vehicles and supply some to Toyota, which will provide technical support.
Toyota and Suzuki intend by 2020 to start selling electric cars in the Indian market, to this end, the parties signed a Memorandum of understanding. The firms said they meant to conduct a comprehensive study of activities for ensuring widespread acceptance and popular use of EVs in India.
Maruti Suzuki is the largest auto manufacturer in the country which supplies large number of cars with various models in India. Suzuki has already announced that it will build a lithium-ion battery plant in Gujarat.
According to analysts, Suzuki being the market leader in India desperately needs an EV and cannott give away this opportunity to Tata Motors and Mahindra & Mahindra.
Nissan, another Japanese company is said to be planning a trial in India for its EV vehicle Leaf which it expects to commercially launch by 2020. Indian government has even reduced the tax on electric vehicles from 29% to 12% giving an impetus to manufacturers to produce electric vehicles domestically.
As per the agreement, in addition to lithium-ion batteries, electric motors and other major components would be locally procured for production of EVs in India.
Toyota's plans, which were outlined today, include the possibility that local partners will both design and manufacture electric vehicles under the Toyota brand.