Tokyo: Japan's top automaker, Toyota, said mid-week it would invest up to 10 billion yen ($96 million) in a Mitsubishi Aircraft Corp project to develop and market the country's first ever passenger jet. Mitsubishi Aircraft Corp, is a wholly-owned new unit of Mitsubishi Heavy Industries (MHI).
Toyota Motor Corp, is widely expected this year to surpass General Motors as the world's top automaker.
"In response to a request from Mitsubishi Heavy Industries Ltd., we have decided to accept up to 10 billion yen worth of increased shares planned by Mitsubishi Aircraft Corp through a third-party allocation," a Toyota statement said.
The investment, once made, will make Toyota Japan's second automaker, after Honda Motor Co, to expand its business interests into aviation.
Mitsubishi Aircraft Corp, currently capitalised at three billion yen, is scheduled to see its capital eventually increase to 100 billion yen, with parent Mitsubishi Heavy holding two thirds of the equity.
Announcing the project on 28 March 2008, Mitsubishi Heavy had said it hoped to secure financial support from Japanese companies, including Toyota, Mitsubishi Corp, Mitsui & Co. Ltd and Sumitomo Corp, along with the government-controlled Development Bank of Japan.
Mitsubishi Aircraft will increase its shares by 67 billion yen -- 6,700 shares worth 10 million yen each -- through a third-party allocation on 30 May. Mitsubishi Heavy will buy new shares worth 44.2 billion yen with Toyota and trading house Mitsubishi Corp. picking up shares worth seven billion yen each.
Sumitomo Corp. and Mitsui & Co. will each invest 3.5 billion yen and the Development Bank of Japan 700 million yen, it said.
The new fuel-efficient jet, dubbed the Mitsubishi Regional Jet, is expected to take to the skies in 2013.
Mitsubishi Heavy said it had decided to go ahead with the commercial development of the plane after landing its first order from All Nippon Airways for up to 25 aircraft.
The jet is expected to compete with other regional and small passenger plane manufacturers, including those of Canada's Bombardier and Brazil's Embraer.