Nissan Takes 34% Ownership And Control Of Mitsubishi, Nissan Outlander PHEV Anyone?
Mitsubishi has been knee-deep in a efficiency/emission scandal of its own in Japan, that has threatened to spread to the US and elsewhere, causing doubts over the future viability of the company.
Update (May 12th 7:00AM)
After sitting down on Thursday, Nissan and Mitsubishi hammered out an agreement where Nissan acquires 34% of Mitsubishi Motors, giving it control of the smaller auto maker.
In total, Nissan is paying 237.4 billion yen ($2.18 billion) for Mitsu. The company states the deal will by finalized by May 25, and that it would receive newly minted Mitsubishi Motors shares.
As expected Nissan will get the appropriate amount of board seats, and Nissan states today that a new chairman of Mitsubishi Motors is incoming, and will be a Nissan nominee under the guidelines of the deal struck Thursday. *cough* Carlos Ghosn *cough*
With the purchase, Nissan will be the largest shareholder, passing Mitsubishi Heavy Industries which owns 20%.
Carlos Ghosn on
his new jobthe deal: “Nissan is determined to preserve and nurture the Mitsubishi Motors brand. We will help this company address the challenges it faces, particularly restoring consumer trust in the fuel-economy performance.”
Nissan and Mitsu already had a 50-50 joint venture on minicars which sees them made by Mitsubishi and sold through Nissan.
It is these minicars that have caused the efficiency scandal, and likely were key in giving Nissan enough settlement leverage to acquire the Japanese auto maker, as Mitsubishi had stated that Nissan had no knowledge or part in the doctoring of data on the four minicars now under investigation.
Nikkei notes Mitsubishi’s minicar and current financial situation:
“Minicars account for 60% of Mitsubishi Motors’ domestic (Japan) sales volume. But the company is financially sound for now, with an equity ratio of 48% and 450 billion yen in cash and equivalents as of the end of March. But a string of scandals since the 2000s has eroded consumer trust in the company. The impact on sales will undoubtedly extend beyond minicars.”
Nissan’s footprint in Japan is 30% made up of minicars via Mitsubishi.
Mitsubishi recently passed the 100,000 sold mark for the Outlander PHEV – and that is without logging any sales yet in the US; those start this Fall. Mitsubishi also has several new plug-in SUV vehicles planned to arrive in the market over the next few years – something which Nissan-Renault sorely lacks.
Now only two question remain: Can Nissan-Renault-AvtoVAZ CEO Carlos Ghosn really manage a 4th auto maker? And natually, who is next?
Last year almost 125,000 plug-ins were sold between the 4 companies, representing almost a quarter of the segment overall, with some 475,000 sold cumulatively.
This year ~36,000 EVs have been sold by the collective group during the first quarter, or about 27% of the worldwide market.