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Rian Castillo
"Purchase of such a large package will make Nissan the largest shareholder of Mitsubishi, - said Carlos Ghosn, President and CEO of Renault and Nissan. – The companies that have collaborated for the last five years, will continue to cooperate in the development of joint platforms, technology exchange and joint sales in emerging markets."
At the auction on Thursday, Mitsubishi’s share price rose by 16% on expectations of a deal, while Nissan’s share price fell by 1.4%.
When Nissan will receive more than a third in Mitsubishi, according to Japanese law it will have veto power in making significant decisions regarding the company.
Overall, the transaction will result in the restructuring of the Japanese automotive market, where eight automakers are operating now. Nissan’s deal will give a chance to expand its presence in some Asian markets, where its cars are poorly represented. As of Mitsubishi, which has a good position in Asia, it will be able to obtain advantages by Nissan’s increasing share in North America.
Cooperation with Mitsubishi on the development and production of minicars is very important for Nissan, as in the segment accounts for about 40% of sales in the local market. Nissan refused its own minicar business in favor of the joint venture with Mitsubishi in 2010.
April 20, Mitsubishi Motors acknowledged that its employees understated data on cars’ fuel consumption during the fuel checks. The non-compliance of stated and actual fuel consumption figures have been found by Nissan, for which the small cars were made. Then, Mitsubishi Motors admitted that the incorrect calculation of fuel consumption had been practiced for 25 years.
Nissan and Mitsubishi Motors has a joint venture NMKV, develops minicars under the brands of the two companies. Nissan said that the companies are going to expand the current partnership. Sales of these models were suspended in late April after the beginning of the scandal with the fuel consumption data fraud on. Osamu Masuko, Chairman/CEO at Mitsubishi Motors Corp., said on May 11 that his company wants to maintain cooperation with Nissan. Above that, he added that the company has enough cash to cover costs associated with the fuel consumption scandal. At the same time, Mitsubishi said it will not seek help from Mitsubishi Group - Mitsubishi Heavy Industries and Mitsubishi.
As reported in the official press release, the company had conducted tests on fuel consumption. The indicator did not meet standards established in Japan, yet the company still sent the false results to the Ministry of Land, Infrastructure, Transport and Tourism of Japan.
The frauds with fuel costs performance relate to four models of mini-cars: eK Wagon, eK Space, Dayz and Dayz Roox.
eK Wagon and eK Space are available and are sold under Mitsubishi brand. Dayz and Dayz Roox have been produced by Mitsubishi Corporation for Nissan Motor since June 2013. According to Mitsubishi, there were a total of 625 thousand mini-cars sold: 157 thousand units under Mitsubishi brand and 468 thousand - under Nissan brand.
Mitsubishi also recognized that as a result of the falsification of figures, the declared fuel efficiency was increased by about 5-10%.
source: wsj.com
At the auction on Thursday, Mitsubishi’s share price rose by 16% on expectations of a deal, while Nissan’s share price fell by 1.4%.
When Nissan will receive more than a third in Mitsubishi, according to Japanese law it will have veto power in making significant decisions regarding the company.
Overall, the transaction will result in the restructuring of the Japanese automotive market, where eight automakers are operating now. Nissan’s deal will give a chance to expand its presence in some Asian markets, where its cars are poorly represented. As of Mitsubishi, which has a good position in Asia, it will be able to obtain advantages by Nissan’s increasing share in North America.
Cooperation with Mitsubishi on the development and production of minicars is very important for Nissan, as in the segment accounts for about 40% of sales in the local market. Nissan refused its own minicar business in favor of the joint venture with Mitsubishi in 2010.
April 20, Mitsubishi Motors acknowledged that its employees understated data on cars’ fuel consumption during the fuel checks. The non-compliance of stated and actual fuel consumption figures have been found by Nissan, for which the small cars were made. Then, Mitsubishi Motors admitted that the incorrect calculation of fuel consumption had been practiced for 25 years.
Nissan and Mitsubishi Motors has a joint venture NMKV, develops minicars under the brands of the two companies. Nissan said that the companies are going to expand the current partnership. Sales of these models were suspended in late April after the beginning of the scandal with the fuel consumption data fraud on. Osamu Masuko, Chairman/CEO at Mitsubishi Motors Corp., said on May 11 that his company wants to maintain cooperation with Nissan. Above that, he added that the company has enough cash to cover costs associated with the fuel consumption scandal. At the same time, Mitsubishi said it will not seek help from Mitsubishi Group - Mitsubishi Heavy Industries and Mitsubishi.
As reported in the official press release, the company had conducted tests on fuel consumption. The indicator did not meet standards established in Japan, yet the company still sent the false results to the Ministry of Land, Infrastructure, Transport and Tourism of Japan.
The frauds with fuel costs performance relate to four models of mini-cars: eK Wagon, eK Space, Dayz and Dayz Roox.
eK Wagon and eK Space are available and are sold under Mitsubishi brand. Dayz and Dayz Roox have been produced by Mitsubishi Corporation for Nissan Motor since June 2013. According to Mitsubishi, there were a total of 625 thousand mini-cars sold: 157 thousand units under Mitsubishi brand and 468 thousand - under Nissan brand.
Mitsubishi also recognized that as a result of the falsification of figures, the declared fuel efficiency was increased by about 5-10%.
source: wsj.com
