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In a bid to counter declining market shares, Honda, Nissan, and Mitsubishi Motors are forming a strategic alliance to enhance their competitive edge in the automotive sector.
Mitsubishi to Join Alliance
The Nikkei newspaper reported on Sunday that Mitsubishi Motors of Japan is going to become a member of an alliance with Nissan Motor and Honda Motor, forming a partnership between the three carmakers with over 8 million units sold.
The three companies plan to standardize in-vehicle software that regulates cars, and Mitsubishi Motors, which Nissan owns 34% of, will collaborate with Honda and Nissan to finish off the details of their strategic alliance.
A representative from Nissan would only state that the report was not based on anything either company has disclosed; Mitsubishi Motors chose not to respond. When asked for a comment, Honda spokespeople chose not to answer.
According to Reuters, in the year leading up to March, half of Nissan's global sales came from sales in the United States and China; nevertheless, the Japanese manufacturer has been seeing a gradual decline in its market share in these two major regions, prompting this drive.
Heavy U.S. discounts nearly eliminated the company's first-quarter earnings, prompting Thursday to cut its annual projection.
Electric Car Component Collaboration
March saw announcements from both Nissan and Honda that they were contemplating a strategic alliance to work together on electric car components and AI for automotive software platforms.
The three automakers last year decided to reorganize their long-standing alliance in an effort to create a smaller, more pragmatic, and nimble collaboration; Mitsubishi Motors is already a part of it. The alliance also includes Nissan and Renault of France.
Japanese Industry Boost
The Japanese car industry could benefit from cost savings and increased resources if Nissan, Honda, and Mitsubishi Motors worked together, rather than competing with Chinese giants BYD and Tesla.
In China, the biggest car market in the world, Japanese brands used to dominate, but local manufacturers have stepped up production and won customers over with affordable, software-loaded automobiles.
