Photo: Volvo Group
Volvo Isuzu Official Partnership

Volvo, Isuzu complete transaction for UD Trucks

April 1, 2021
The strategic alliance between both companies — which will have a minimum duration of 20 years — is intended to address possibilities and challenges of the logistics industry of the future.

Isuzu Motors has acquired UD Trucks from the Volvo Group for $2.19 billion, on a cash and debt free basis, as a part of the strategic alliance between the commercial vehicles departments of the two groups. The strategic alliance, aiming to capture opportunities in the ongoing industry transformation, will now also become operational.

The transaction is estimated to have a positive impact on the Volvo Group’s operating income in the second quarter 2021 of close to $229 million and increase Volvo Group’s net cash position by approximately $2.1 billion.

The alliance between the Swedish and Japanese companies aims to build a “long-term and robust relationship,” according to Volvo. The OEMs are forming a technology partnership intended to leverage each company’s areas of expertise within both well-known and new technologies and creating a more extensive volume base to support investments for world-class technology.

Volvo and Isuzu will establish a Joint Alliance Office, with facilities both in Japan and Sweden, which will be overseen by an Alliance Board comprising the Isuzu Motors President, the Volvo Group CEO and other key executives from the two groups. The Alliance – which will have a minimum duration of 20 years – is intended to address possibilities and challenges of the logistics industry of the future.

The Alliance is now entering the next phase with focuses on:

  • Creating the best long-term conditions for a stronger heavy-duty truck business for now Isuzu-owned UD Trucks and Isuzu Motors in Japan across international markets.
  • Exploring further opportunities for even broader and deeper collaboration within the commercial vehicle businesses across geographical areas and product lines for future urban logistics solutions.
  • Exploring cooperation in the areas of purchasing and logistics, leveraging common technology, as well as the geographical footprint complementarity and volume expansion.

If UD Trucks performs well, Isuzu is to pay Volvo Trucks up to $135.5 million during 2021-2023 as an earnout subject.

Sponsored Recommendations

Heavy-Duty Maintenance Checklist

A maintenance checklist can help ensure you hit everything necessary during an inspection. Check out our free downloadable checklist to help streamline your repairs.

Five Ways a Little Data Can Save Your Company Millions

While most trucking and logistics companies rely on cellular to keep their work fleet connected, satellite has the ability to connect anywhere and through small data transmission...

Fleet Case Study: 15% YOY Growth for ITDS

Learn how this small trucking company scaled significantly and maintained outstanding customer service without adding additional people. Sylectus TMS can automate operations and...

Unlocking Fleet Safety & Efficiency: The Managed Service Advantage

Want to boost your fleet's safety and efficiency? Tune in now to discover the power of Managed Services in optimizing your safety program, streamlining operations, and making ...

Voice your opinion!

To join the conversation, and become an exclusive member of FleetOwner, create an account today!