In a surprise announcement, Nissan and Mitsubishi Motors have declared an alliance that has Nissan buying a large stake in Mitsu. The far-reaching agreement creates a “strategic alliance” between the two automakers that will not likely be as thorough as is the Renault-Nissan alliance, but it will be close.
Details are pending a lot of agreements and regulatory checks, but the new Mitsu-Nissan alliance will extend their current partnership to include a lot more than just technology swaps. The new alliance will allow them to share manufacturing facilities and parts orders, which could potentially give Mitsubishi an inroad to building vehicles in North America – a major hurdle the company has struggled to surmount. The alliance would also allow the two companies to share vehicle platforms, which could give Mitsubishi a chance to rebrand some Nissan/Datsun products in growth markets and vice versa.
Carlos Ghosn, chief executive and president of Nissan, said: “This is a breakthrough transaction and a win-win for both Nissan and Mitsubishi Motors. It creates a dynamic new force in the automotive industry that will cooperate intensively, and generate sizeable synergies. We will be the largest shareholder of MMC, respecting their brand, their history and boosting their growth prospects. We will support MMC as they address their challenges and welcome them as the newest member of our enlarged Alliance family.”
Nissan will be taking a 34 percent stake in Mitsubishi Motors at a 237 billion yen price tag. This will make Nissan the largest stakeholder in Mitsu Motors and gives Nissan the right to name a Chairman of the Board for Mitsubishi. It’s expected that this new alliance agreement and transfers will close by the end of the year.
Nissan currently holds a close partnership-style alliance with Renault, sharing a CEO in Carlos Ghosn. Nissan also has equity stakes and/or alliance agreements with Daimler and AvtoVaz. The agreement will leave other Mitsubishi companies, namely Mitsu Heavy Industries and Mitsu Corp, as significant collective owners of Mitsubishi Motors.