New Japanese Anti-trust Laws Opens Toyota’s Road to Subaru

Since Toyota had bought over 8.7 percent of Fuji Heavy Industries shares from GM in October 2005, it has been industry gossip that they were eyeing on a takeover of Subaru’s parent company. Set to be effective as of April 2007, the new laws are designed to help Japanese companies to be stronger competitors in the world market. They will also consider global market share when reviewing mergers and acquisitions. Japanese laws have, up until now, prevented any single company from controlling more than 50 percent of their domestic market for any particular product, which in this case is automobiles. In 2006, the combined sales of Toyota and Subaru amounted to 45.6 percent of the Japanese domestic market, which would have been extremely close to the allowed half. With such opportunities for both companies, whether technology and goals will be shared remains yet to be seen. It would, however, be interesting to see better cross-breeds in the future.