Even the main boss of Honda is not sure
The silence that has arisen about the potential merger of Honda and Nissan into one of the world’s largest automotive groups raises doubts about the feasibility and strategic purpose of this move.
A moment of uncomfortable candor from Honda CEO Toshihiro Mibe at a recent press event only fueled doubts about the merger of the two companies. When asked why Nissan would be an ideal partner for Honda, Mibe honestly and briefly answered: “It’s hard to say”, which caused laughter from the audience but also fueled discomfort about the merger of these two brands.
This candid response also raised some obvious questions: Should this be a transformative alliance between two storied Japanese brands or a desperate measure by two automakers struggling to navigate a rapidly changing industry?
So Honda is in a relatively good situation, but it is far from progressing in the segment of EV cars. While still dominant in the hybrid and traditional markets, Honda’s EV ambitions are small and slow. The partnership with GM collapsed after the weak debut of the Honda Prologue, and Honda’s first independently developed long-range EV isn’t expected until next year, according to Klix.ba.
On the other hand, Nissan has bigger problems. Weak finances and the ongoing problems of managing the dealerships have become quite a burden. However, Nissan has some advantages such as an impressive production network, especially in Southeast Asia, but also the remarkable domestic sales hit Nissan Sakura.
Proponents of the merger point out that Nissan’s experience in electric vehicles could support Honda’s electrification gaps, while Honda’s hybrid know-how could revitalize Nissan’s offering. But skeptics aren’t convinced, with auto analyst Julie Boote of Pelham Smithers Associates saying, “Honda needs to partner with another company to boost its EV and software-defined vehicle efforts because it’s a midsize automaker. Ideally, it would be a healthy and financially sound company, not Nissan.”
Even Mibe himself seemed to echo these concerns, publicly stating that Nissan needed to stabilize its finances first. Given that the formalization of the merger of these two brands will allegedly take place in about six months, the timeframe is optimistic at best. Consulting firm AlixPartners warns that any real benefits from the merger could be felt for three to five years, which in this dynamic time for the auto industry is simply too long.
Also, let’s not forget the political entanglement where there are rumors that Japan’s Ministry of Economy, Trade and Industry (METI) may have pushed this merger to block rumors of a takeover of Nissan by Taiwanese tech giant Foxconn. Former Nissan CEO Carlos Ghosn was outspoken in his criticism of such interference, saying: “It means you’re putting control over performance. Personally, I don’t think it will be successful.”
The merger, if it goes ahead, could chart an uncertain course for both automakers. Honda continues to face delays in its EV ambitions, while Nissan struggles to stabilize its financial footing. And while Mibe has struggled to present a convincing vision for the partnership, industry watchers are wondering if the alliance is more of a gamble than a strategic masterstroke.
Source: Klix.ba
Photo: Arhiva / Honda – Nissan
Source: autoblog.rs
