When it comes to automobiles, the name Porsche carries some pretty clear connotations. Distinctive styling, world-class German engineering, and sticker shock might be among the most common things that consumers associate with the brand. One item that probably wouldn't come to mind, though, is Japanese technology, but that may change in the near future.
Just when it looked like Toyota (NYSE:TM) couldn't top itself, Reuters reported today that the automaker is fielding calls from Porsche asking to use the Japanese juggernaut's hybrid technology. Toyota's success with its hybrid system can hardly be overstated. The company has been selling its Prius models, which incorporate the technology, faster than it can make them. Meanwhile, the car continues to receive plenty of publicity.
Further, Toyota's hybrid know-how has given it an edge over rivals in more ways than one. Thanks to the success of the Prius and other models, Toyota may soon overtakeGeneral Motors (NYSE:GM) in terms of production. Ford (NYSE:F), meanwhile, opted to license some of Toyota's technology in order to produce its own hybrid, the Escape SUV.
As for Porsche, it seems to be following Ford's strategy. The German company is reportedly interested in a 270-horsepower powertrain that Toyota plans to put in its own SUV, the Lexus RX 400h. Porsche apparently hopes to employ the Toyota technology in its Cayenne SUV.
In the end, the financial benefit to Toyota from a licensing deal with Porsche probably wouldn't be that significant. But such an arrangement would be yet another strong endorsement of the Japanese firm's technology by a legend in the design of luxury automobiles. This may prove especially important in Toyota's competition with Honda (NYSE:HMC), which is stepping up its own hybrid production. After all, if Toyota's technology is good enough for Porsche, it's probably good enough for most car buyers.
Fool contributor Brian Gorman is a freelance writer living in Chicago. He does not own shares of any companies mentioned here.
