It's a deal that's been talked about since May, but it's finally official. Nissan confirmed that it has purchased a controlling interest in beleaguered automaker Mitsubishi Motors. The 34 percent share cost Nissan $2.3 billion U.S.
The deal came about shortly after Mitsubishi came under fire for admittedly cheating on fuel economy figures. The fudged numbers were only on certain Japanese models but the scandal lead to production stoppages and the company's first loss in eight years. Nissan and Mitsubishi already had a partnership at that time, and nearly half a million of the affected cars were models that Mitsubishi had built for Nissan.
In the short term, expect little change for either automaker, with the exception of Nissan and Renault CEO Carlos Ghosn adding CEO of Mitsubishi to an already long business card. There is no plan to discontinue the Mitsubishi brand, with Ghosn saying "we are committed to assisting Mitsubishi Motors as it rebuilds customer trust.” In the longer term, expect more platform and technology sharing between the two. Nissans rebadged as Mitsubishis are possible for the North American market, as the two already share some vehicles in Japan.
Carlos Ghosn became CEO of Nissan in 1999 and has helped turn the struggling automaker into a profitable one. Ghosn claims that the trio of Nissan, Renault, and Mitsubishi would be the third largest automotive group in the world, after Toyota and Volkswagen. That size can lead to improved opportunities for sharing of platforms, technology, and costs.
