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Toyota, GM Partnership Likely to End

A seven-year partnership between automotive giants Toyota and GM to work on technology together will most likely end next month as a new extension seems unlikely.

A symbolically partnership between Toyota and General Motors will end next month. The completion of the partnership comes at a time when Toyota is threatening to overtake GM as the world's top automaker, according to a report by the Associated Press.

The five-year deal was initiated in 1999 when the two companies agreed to work together in technology. The deal was then extended for two years 
in 2004. However, the AP report cites opinions from officials from both companies that another extension is unlikely.

GM and Toyota officials have said that both sides are still talking about possible collaboration in technology, including pollution-free hydrogen fuel cells and hybrids. However, there has been little progress in the talks.

If Toyota keeps up its current pace of growth, it could surpass GM in the next few years. GM sold 9.17 million vehicles worldwide in 2005. Late last year, Toyota announced a global production target of 9.06 million vehicles for 2006, which includes output from group manufacturers.

Tsuyoshi Mochimaru, auto analyst with Deutsche Securities in Tokyo, told AP that he believes it's better if GM and Toyota can maintain the alliance even as a symbol of good relations between two powerful companies.

However, GM has already agreed with DaimlerChrysler to develop hybrid engines. It has also reached a similar agreement with BMW Group.

 

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