Thursday, May 12, 2016

Nissan flies to the rescue of Mitsubishi Motors, in the fraud scandal – The Point

The Japanese carmaker Nissan has reached out Thursday in Mitsubishi Motors Corporation (MMC) by taking a 34% stake in compatriot prey to a fraud scandal, an operation that strengthens the alliance already formed with the french Renault.

in approaching MMC, the alliance, which also includes the Russian Avtovaz, will see its annual sales exceed 9.5 million, close to the world’s top trio of Japanese Toyota, German Volkswagen and General Motors (GM).

According to financial documents, Mitsubishi Motors will issue shares to Nissan for a total of 237.36 billion yen (1.9 billion euros).

MMC share jumped 16.16% on Thursday confirming the talks.

by October, Nissan will become the largest shareholder of MMC before the Mitsubishi Heavy Industries group (MHI), which owns 20% of shares.

the two partners will however remain well “separated”, emphasized the CEO of Nissan Carlos Ghosn at a press conference. “There is no confusion: Nissan is Nissan, Mitsubishi Mitsubishi is an independent company with its own strategy and its own direction”

actionnariales relations between Renault and Nissan will therefore not be affected. by the operation. The French owns 43% of Nissan, and the Japanese control 15% of the diamond brand, as part of a knotted alliance in 1999

-. ‘Coronation’ –

Mr. Ghosn hailed a transaction “potentially win-win for both companies.” “We were looking to strengthen our collaboration for some time, and that the crisis occurred, speeding things,” said the CEO.

“We will help Mitsubishi Motors to meet the challenges facing it and to restore consumer confidence, “he said. “But the transaction announced today is also about Mitsubishi’s future growth as part of our family, built around the pillar of our alliance with Renault for 17 years.”

“I have the impression that there Ghosn seeks the coronation of his career “, commented to AFP Seiji Sugiura, an analyst at the research center at Tokai Tokyo. It has “seized the opportunity” and used the scandal to afford MMC cheap

The two groups were already partners. Nissan provides sedans MMC, which manufactures its part mini- Nissan vehicles. Moreover, it is the latter who discovered irregularities regarding fuel consumption measurement of these compact cars, popular in Japan.

Mitsubishi Motors had initially, on 20 April, is share data manipulations on four models to beautify their energy performance. He then acknowledged using unapproved tests in Japan for 25 years, “suspicions” on several models

-. Complementarity –

Since these revelations, Mitsubishi controls Motors plunged in the archipelago, as the action – which collapsed more than 40% -, raising concerns about the future of the group, one of the smaller Japanese manufacturers with only a million vehicles sold per year.

Wednesday, its leaders had assured to manage the crisis without having to resort to using the companies of the Mitsubishi galaxy, who had come to his rescue in a previous scandal in years 2000.

the deal “will bring, I think, tremendous benefits to Mitsubishi, Nissan, but also will benefit,” noted Carlos Ghosn, citing the performance of his compatriot in Southeast Asia “Nissan knows where instead of difficulties, while it is well established in the USA where MMC feeds ambitions.

The project makes sense, analysts confirm, Nissan and MMC also have technological complementarities (electric and hybrid). MMC can also assert its two flagship products:. 4×4 and mini cars

The operation is part of a restructuring of the Japanese auto industry, rich eight manufacturers and even a dozen counting trucks manufacturers: Toyota has recently decided to acquire all of its subsidiary Daihatsu

“the environment has changed, it is difficult to survive alone.” , said the Chairman of MMC board, Osamu Masuko.

more broadly, this merger could lead to other changes in an area where partnerships are numerous. Mitsubishi Motors operates a plant in Russia with the PSA Group, Senior Renault competitor.

bur-ANB / uh / ggy

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12/05/2016 11: 7:33 – Tokyo, May 12, 2016 (AFP) – AFP © 2016

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