Nissan Motor seems to view green-vehicle technologies and a stepped-up presence in Southeast Asia as fruits of its new partnership with Mitsubishi Motors.
Nissan purchased 34% of Mitsubishi’s outstanding shares for 237 billion yen ($2.27 billion), effectively rescuing the smaller automaker from a fuel-economy scandal that came to light in April.
Focus on Southeast Asian market
Global expansion will center on the key Southeast Asian market. Mitsubishi Motors will supply Nissan with multipurpose vehicles built at an Indonesian plant to open next year — under an original equipment manufacturer arrangement. Mitsubishi Motors is highly competitive in pickup trucks in Southeast Asia. Nissan has yet to cultivate this region so it now plans to play catch-up.
Annual sales at the two automakers and Nissan’s long-standing French partner Renault total 10 million units or so. The partners aim to capitalize on economies of scale in procurement and production to slash costs and sharpen their game in a harsh competitive landscape.
In green technologies, Nissan and Renault seek to cash in on Mitsubishi Motors’ plug-in hybrid technologies cultivated via the Outlander sport utility vehicle. Carlos Ghosn, CEO of the Nissan-Renault alliance, who will also become chairman of Mitsubishi Motors, told reporters that being able to use the fellow Japanese automaker’s technology as a basis for development is beneficial. As plug-in-hybrid sales increase, parts procurement costs will drop and profitability rise. The collaboration will give Nissan the ability to expand its Earth-friendly offerings beyond its Leaf electric vehicle.