Nissan moves on Mitsubishi
Nissan has agreed to a 34% controlling share in scandal-hit Mitsubishi Motors in a bid to rebuild trust in the car maker.
Nissan has vowed to rebuild trust in Mitsubishi Motors following it admitting it had faked data to overstate the fuel efficiency of more than 600,000 cars.
Nissan will pay 237bn yen ($2.2bn) for a 34% share, giving it a controlling stake in its smaller Japanese rival. Carlos Ghosn, Nissan’s chief executive, said, ‘At Nissan we are determined to preserve and nurture the Mitsubishi Motors brand. And we will help this company address the challenges it faces, particularly in restoring consumer trust in its fuel economy performance.
‘Nissan will also contribute to management expertise and corporate governance experience necessary to deliver sustainable and profitable growth.’
Commenting on the move, Paul Newton, director, world markets analysis, IHS Automotive, said, ‘Despite the apparent opportunistic nature of the move, the investment has a wider and more long-term rationale in areas of new technology and future platform development/sharing. Mitsubishi’s plug-in hybrid technology compliments rather than competes with Renault-Nissan’s electric vehicle technology. In the profitable segments of pick-ups and SUVs there is significant opportunity to develop platforms which will gain from the additional economies of scale selling across two/three brands.’
Shwetha Surender, programme manager, mobility, automotive and transportation, Frost and Sullivan, said, ‘The deal is likely to allow Nissan to expand its foothold in South East Asia particularly in countries such as Thailand and Philippines.’
The two companies are already partners in development and manufacturing, but there was no cross-ownership involved.
Mitsubishi falsified mileage test results on a number of models, including two it manufactured for Nissan, Japan’s second largest car-maker after Toyota. Mitsubishi said at the time the cars affected were only sold in Japan. However, it said it would extend its investigation to cover cars made for overseas markets.