GM, Isuzu end pick-up truck tie-up; GM eyes more upscale market

[July 22, 2016]  By Norihiko Shirouzu and Naomi Tajitsu

BEIJING/TOKYO (Reuters) - General Motors Co <GM.N> and Isuzu Motor Co have agreed to stop working together on developing midsize pick-up trucks made in Asia, as the U.S. automaker focuses on the higher end of the market while the Japanese firm sticks to selling vehicles for everyday commercial purposes.

The automakers said on Friday they had cancelled their pick-up truck deal struck in 2014, the latest under a joint product development arrangement which began in 2006.

They added that separate collaboration agreements, including one for commercial vehicles in the United States, remained intact.

"The direction each company wanted to take (for the vehicles) was changing," an Isuzu spokesman said, adding that the Japanese truck maker intended to continue making trucks to be used as workhorse vehicles in markets including Australia, the Middle East, and Asia.

"Both GM and Isuzu agree that due to unique requirements for each company, joint development of the next-generation midsize pick-up truck for (GM) markets is no longer the optimal model for this project," GM said in a statement.

Under the agreement, Isuzu, which specialises in light trucks and commercial vehicles, had developed its D-Max pick-up truck, marketing the model in Asia and beyond, focusing on markets including Australia and the Middle East.

GM produced a version of its Colorado pick-up trucks and Trailblazer SUVs for Asian and Australasian markets. The Asia-produced Colorado pickup is different from a model sold under the same name in the United States, which GM has developed on its own.

One GM executive said the "unique requirements" for GM are about the strategic shift it began making last year in Southeast Asia where it is now trying to focus more on competing in the higher end of the region's truck and SUV markets.

The GM logo is seen at the General Motors Lansing Grand River Assembly Plant in Lansing, Michigan October 26, 2015. REUTERS/Rebecca Cook

Despite the obvious benefits of collaborating on development such as sharing costs, the executive, who declined to be named because he is not authorized to discuss the move, said that GM had decided not to try to copy its Japanese rivals in Southeast Asia where brands like Isuzu, Toyota Motor Corp and Mitsubishi Motors Corp dominate.

"It doesn't make sense for us trying to copy the business strategy of the Japanese rivals in Southeast Asia," the executive said.

GM's revamped strategy is especially pronounced in Thailand, where the automaker is now launching sleeker pick-up trucks.

Isuzu and Mazda Motor Co  earlier this month announced that Isuzu would produce next-generation pick-up trucks for Mazda outside North America.

(Reporting by Norihiko Shirouzu in Beijing and Naomi Tajitsu in Tokyo; Editing by Muralikumar Anantharaman, Stephen Coates and Adrian Croft)

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