Honda and NissanTwo of Japan’s largest automakers are in talks to merge in a bid to meet the challenge from Chinese electric vehicle manufacturers. The merger would form one of the largest automobile groups in the world if completed, along with Toyota. VolkswagenAnd General Motors Ford.
The emergence of Chinese electric car makers Like BYDshook the global automobile world, forcing consolidation. CEO of Honda TOSHIHIRO — Honda Motor Co. needs to move quickly to prevent Japanese automakers from being left behind in the global shift toward electric vehicles, its CEO said Thursday, while also backing away from a nationwide call to phase out oil-based vehicles. By 2035. “The structure of the automobile industry is changing rapidly,” Meeby said.
That would include Mitsubishiof which Nissan is the largest shareholder, allowing the three companies to pool resources to better compete with global rivals such as Tesla. By pooling their experience and technology, they will have a greater ability to produce competitive electric cars at lower costs.
China, the world’s largest electric vehicle producer, has dominated the electric vehicle market through low production costs and government support. The European Union responded to the threat by imposing tariffs of up to 45% on Chinese electric vehicle imports, Konrad Butzier reported. But it has raised concerns about rising prices of electric cars for consumers.
Nissan, which has suffered sales and job cuts in recent years, sees the merger as an opportunity to regain its competitive edge. Together, Honda and Nissan have more than $191 billion in combined annual sales, CEO Makoto Uchida noted. However, Meeby rejected claims that the merger was a bailout for Nissan, arguing that it was a strategic move driven by the imperative of survival.
Honda and Nissan have already partnered on electric vehicle technologies since March, when the two companies signed an expanded cooperation agreement for battery development and other progress in August. But the proposed merger would likely mean the end of Nissan’s decades-long partnership with Renault, as well as facing political opposition in Japan over the chance of job cuts.
Former Nissan boss Carlos Ghosn dismissed the talks as a sign of desperation, but Maype defended the plan as a vision for the future. By pooling their resources, the companies want to strengthen their position in an increasingly rapidly changing auto market and fend off growing competition from China and elsewhere.