The amount of the transaction, which will be closed before the end of the year, will be $2.18 billion. According to its results, Nissan will become the largest shareholder of the competitor.
The agreement signed between the two companies actually leads to the formation of a new major alliance.
Nissan and Mitsubishi have worked together for a number of years, but now the partnership in various areas will be taken to a whole new level. We are talking about procurement, the unification of platforms for cars, the sharing of technologies and production capacities.
“This agreement is a significant breakthrough and win-win deal for both Nissan and Mitsubishi Motors,” Ghosn said. - Cooperation will create a new dynamic force in the automotive industry, which will actively and fruitfully interact. We will be Mitsubishi's largest shareholder, honoring the brand, its history and its future. We will stand by Mitsubishi in this challenging time and are pleased to welcome the company as a new member of our extended alliance family.”
Speaking about the difficult situation, the top manager had in mind a grandiose fuel scandal, in the epicenter of which Mitsubishi was in April. It turned out that the company for 25 years underestimated the data on fuel consumption in some models. The company also admitted that they tested their cars bypassing the rules in order to indicate lower fuel consumption in the documentation. According to preliminary data, this figure was underestimated by 5-10%. Mitsubishi apologized for the fraud and suspended sales of the eK Wagon and eK Space subcompacts, but the full list of models that underestimated fuel consumption - there are at least ten of them, including Pajero - is still unknown. In total, we can talk about 2 million cars.
The scandal, which caused a harsh reaction from the Japanese authorities, brought down Mitsubishi shares by a third, the company "lost weight" by the very two-plus billion dollars that Nissan is now going to invest in it.
It is noteworthy that against the background of revelations, sales of small cars in Japan collapsed by 60%, and in addition to Mitsubishi products, demand also collapsed for cars of the same class from Nissan, which were developed at a joint venture between the two companies, which has been operating since 2010.
“Nissan Motor has a wealth of knowledge that will help us get the most out of our mutual partnership,” said the head of Mitsubishi Motors at a press conference. — This agreement is aimed at future progress and mutual benefit for our companies. Through our close strategic partnership, pooled market development resources and joint procurement, we will reap long-term benefits.”
Mitsubishi said in a press release that Nissan's decision to buy the shares is "a milestone in the expansion of the alliance built over 17 years through cross-sharing with Renault." "Nissan has also acquired stakes or signed partnerships with other automotive concerns, including Daimler and," Mitsubishi recalled.
The inclusion of Mitsubishi in the Renault-Nissan alliance will allow the new association to compete for the second or third place in global car sales with the Volkswagen and GM concerns in terms of total sales, which annually sell about 10 million cars.
The leader of the global automotive industry is still Toyota, which was able to step over this mark last year.
About thirty years ago, the famous American manager Lee Iacocca said that by the beginning of the 21st century, only a few players would remain in the global automotive market. The ex-president of Chrysler and Ford saw through the trends in the further development of the automotive industry, so it is not at all surprising that his predictions are confirmed.
The world's largest automakers and alliances
At first glance, it may seem that there are many independent automakers in the world, but in fact, most auto companies are part of various groups and alliances.
Thus, Lee Iacocca looked into the water, and today there are actually only a few automakers left in the world who have divided the entire global car market among themselves.
What brands are owned by Ford
Interestingly, the companies he headed - Chrysler and Ford - the leaders of the American auto industry, suffered the most serious losses during the economic crisis. And they had never been in such serious troubles before. Chrysler and General Motors went bankrupt, and only a miracle saved Ford. But for this miracle, the company had to pay too dear a price, because as a result, Ford lost its premium division Premiere Automotive Group, which included Land Rover, Volvo and Jaguar. Moreover, Ford lost Aston Martin, the British supercar manufacturer, a controlling stake in Mazda, and liquidated the Mercury brand. And today, only two brands remain from the huge empire - Lincoln and Ford itself.
What brands belong to the auto concern General Motors
General Motors suffered no less serious losses. The American company lost Saturn, Hummer, SAAB, but its bankruptcy did not prevent it from defending the Opel and Daewoo brands. Today General Motors includes such brands as Vauxhall, Holden, GMC, Chevrolet, Cadillac and Buick. In addition, the Americans own the Russian joint venture GM-AvtoVAZ, which produces the Chevrolet Niva.
Automaker Fiat and Chrysler
And the American concern Chrysler now acts as a strategic partner of Fiat, which has brought together such brands as Ram, Dodge, Jeep, Chrysler, Lancia, Maserati, Ferrari and Alfa Romeo under its wing.
In Europe, things are somewhat different than in the US. Here the crisis has also made its own adjustments, but the position of the monsters of the European automobile industry has not been shaken by this.
What brands belong to the Volkswagen Group
Volkswagen is still accumulating brands. After buying Porsche in 2009, the Volkswagen Group has nine brands - Seat, Skoda, Lamborghini, Bugatti, Bentley, Porsche, Audi, truck manufacturer Scania and VW itself. There is evidence that soon this list will include Suzuki, 20 percent of whose shares are already owned by the Volkswagen Group.
Brands owned by Daimler AG and BMW Group
As for the other two "Germans" - BMW and Daimler AG, they cannot boast of such an abundance of brands. Under the wing of Daimler AG are the brands Smart, Maybach and Mercedes, and the history of BMW includes Mini and Rolls-Royce.
Renault and Nissan Automobile Alliance
Among the world's largest automakers, one cannot fail to mention the Renault-Nissan alliance, which owns such brands as Samsung, Infiniti, Nissan, Dacia and Renault. In addition, Renault owns 25 percent of AvtoVAZ shares, so Lada is also not an independent brand from the French-Japanese alliance.
Another major French automaker, PSA, owns Peugeot and Citroen.
Japanese automaker Toyota
And among Japanese automakers, only Toyota, which owns Subaru, Daihatsu, Scion and Lexus, can boast of a “collection” of brands. Also part of Toyota Motor is the truck manufacturer Hino.
Who owns Honda
Honda's achievements are more modest. In addition to the motorcycle department and the premium Acura brand, the Japanese have nothing else.
Successful Auto Alliance Hyundai-Kia
In recent years, the Hyundai-Kia alliance has been successfully breaking into the list of leaders in the global automotive industry. Today, it produces cars only under the brands Kia and Hyundai, but the Koreans are already seriously engaged in creating a premium brand that could be called Genesis.
Acquisitions and mergers in recent years include the takeover of the Chinese brand Volvo by Geely, as well as the acquisition of the British premium brands Land Rover and Jaguar by the Indian company Tata. And even the most curious case is the purchase of the famous Swedish brand SAAB by the tiny Dutch supercar manufacturer Spyker.
The once powerful British auto industry is dead. All the famous British car manufacturers have long since lost their independence. Their example was followed by small English firms that passed to foreign owners. In particular, the legendary Lotus today belongs to Proton (Malaysia), and the Chinese SAIC bought MG. By the way, the same SAIC had previously sold the Korean SsangYong Motor to the Indian Mahindra&Mahindra.
All of these strategic partnerships, alliances, mergers and acquisitions have once again proven Lee Iacocca right. Single firms in the modern world are no longer able to survive. Yes, there are exceptions, like the Japanese Mitsuoka, the English Morgan or the Malaysian Proton. But these companies are independent only in the sense that absolutely nothing depends on them.
And in order to have annual sales amounting to hundreds of thousands of cars, not to mention millions, one cannot do without a strong “rear”. In the Renault-Nissan alliance, partners provide support to each other, while in the Volkswagen Group, mutual assistance is ensured by the number of brands.
As for such companies as Mitsubishi and Mazda, in the future they will face more and more difficulties. While Mitsubishi can get the help of partners from PSA, Mazda will have to survive alone, which in the modern world is becoming more and more difficult every day ...
Do you know who they belong to? In principle, at first glance, the answer to this question is quite easy. But it's not so simple. Especially with regards to the various divisions of well-known brands, in which you can even get confused. Plus, over the past decades, many car brands have become the property of other car companies. So today only an expert and connoisseur of the modern car market can easily name who owns car brands.
For example, for decades the British brand Vauxhall and the German brand Opel were owned by the American company General Motors. But in March 2017, the deal of the year (maybe even the deal of the decade) took place, in which the PSA group of companies acquired the Vauxhall and Opel car brands for $2.3 billion. This means that now the Vauxhall and Opel brands are owned by a joint company of Peugeot and Citroën brands, which created the PSA auto alliance. That is, now the Vauxhall and Opel brands belong to French car brands.
So, as you can see, not everything is so simple in the modern car market. But thanks to our material, you can find out who owns which car brands these days. This will help you not only expand your knowledge in the automotive world, but also become a real connoisseur in the world of automotive corporations.
BMW Group
The aircraft engine manufacturer Rapp Motorenwerke founded Bayerische Motoren Werke in 1917. Bayerische Motoren Werke further merged with the aviation company ayerische Flugzeug-Werke in 1922. In 1923, the combined corporation began to produce engines for motorcycles, and also launched the production of motorbikes. In 1928, the production of automobiles began. Today it has a rather simple structure.
Here are the brands currently owned by the BMW Group:
bmw
Mini
Rolls Royce
BMW Motorrad (motorcycle brand)
Daimler
Daimler-Motoren-Gesellschaft (DMG) was founded in 1899. It merged with Benz & Cie in 1926. From that moment on, Daimler-Benz AG appeared in the world.
The headquarters is located in Stuttgart, Germany.
The company has a fairly complex corporate structure that includes brands ranging from microcar maker Smart to school bus maker.
Here are the brands Daimler owns today:
mercedes benz
Smart
Mercedes-Benz Truck (Manufacturer of trucks)
Freightliner (U.S. tractor and truck manufacturer)
Fuso (Manufacture of commercial trucks)
Western Star (Manufacture of semi-trailers)
Bharatbenz (Indian automobile company that manufactures buses and trucks)
Mercedes-Benz Vans (Manufacturer of minibuses and minivans)
Mercedes-Benz Buses (Bus manufacturer)
Setra (Manufacture of buses)
Thomas Built (Manufacturer of school buses)
(Mercedes-AMG (production of powerful and sports cars based on serial Mercedes models) is a division that is part of Daimler AG).
General Motors
In 1908, Buick owner William K. Durant, together with the Olds Motor Vehicle Company (Oldsmobile), founded a holding company that was supposed to help automobile brands compete in the car market. In 1909, Cadillac and Oakland joined the holding, which later received the new name Pontiac. Later, General Motors began to take over many small car companies. So, in 1918, the brand entered the holding.
General Motors is headquartered in Detroit, Michigan, USA.
In 2008, following the global financial crisis, General Motors shut down brands such as Oldsmobile, Pontiac, Saturn and Hummer.
The corporation currently controls the following companies:
Autobaojun (Car manufacturer in China)
Buick
Cadillac
Chevrolet
GMC
Holden (Australian car manufacturer)
Jiefang (Chinese company that manufactures commercial vehicles)
Wuling (Car manufacturer in China)
Fiat Chrysler
The Italian company and the American brand Chrysler officially completed their merger in October 2014, creating the Fiat Chrysler Automobiles alliance. This process started in 2011.
Recall that Fiat began its history back in 1899 (Società Anonima Fabbrica Italiana di Automobili Torino).
Fiat Chrysler Automobiles is technically headquartered in London, England. However, most of the actual work is done at Chrysler's headquarters in Auburn Hills, Michigan, USA, and Fiat's headquarters in Turin, Italy.
The FCA Alliance manages:
Chrysler
Dodge
Jeep
Ram
fiat
Alfa Romeo
Fiat Professional
Lancia
Maserati
Tata Motors is headquartered in Mumbai, India.
Tata operates the following companies:
Tata
Land Rover
Jaguar
Tata Daewoo (Production of commercial vehicles)
Toyota Group
The automotive division of Toyoy Automatic Loom Works entered the automotive market in 1935 with the launch of the G1 pickup truck. Then in 1937, the automobile division was spun off into a separate Motor Company. Toyota's first car was the GA truck, which replaced the old Toyota G1.
Toyota is headquartered in Toyota City, Japan.
Toyota Group owns:
Toyota
Lexus
Hino (Production of commercial vehicles)
Daihatsu
Volkswagen Group
The roots go back to the days of Nazi Germany, when the country sought to create a "people's machine" to mobilize the population. By the way, before the start of World War II, Volkswagen was able to produce the first batch of such cars. But then the plant switched to the production of military vehicles. After the war, the production of the "people's car" continued. It was the legendary "Beetle" (Volkswagen Beetle). As a result, 21 million cars were produced.
Volkswagen headquarters is located in Wolfsburg, Germany.
The Volkswagen Group currently controls:
Volkswagen
Audi
Bentley
Bugatti
Lamborghini
Porsche
SEAT
Skoda
MAN (Production of heavy trucks)
Scania (Another company that produces heavy trucks and trucks)
Volkswagen Commercial (Manufacture of commercial vehicles: minivans, minibuses, vans)
Ducati (Motorcycle manufacturing)
Zhejiang Geely
Li Shufu founded Zhejiang Geely Holding Group in 1986. In 1997, he created Geely Automobile. Despite the fact that this is a fairly young car company, the concern owns several large car holdings through smart acquisitions.
Zhejiang Geely is headquartered in Hangzhou, Zhejiang Province, China.
The company controls the following brands:
Geely Auto
Volvo
lotus
Proton (Malaysia)
London EV Company (Production of taxi cars for London)
Polestar (Manufacture of electric vehicles)
Lynk & Co (Premium brand focused on the production of expensive electric cars)
Yuan Cheng Auto (Manufacture of commercial vehicles)
Terrafugia (Flying car manufacturing)
Recent investments make Geely the largest shareholder in Volvo AB, which makes commercial vehicles and is responsible for the brands and Renault Trucks (Volvo and Renault trucks).
May 19th, 2016
A deal can be valued in different ways. Considering the size of Nissan, it would be more correct to call what is happening a takeover, but the experience of other auto alliances shows that such a clumsy method does not give the best results. A soft partnership, as in the case of the Renault-Nissan alliance, is much more promising. Let's see what Nissan, Mitsubishi and Russian buyers will benefit from this limited alliance.
Let me remind you that Nissan is buying a 34% stake in Mitsubishi for $2.2 billion. Officially, this is called a "long-term strategic alliance." Nissan and Mitsubishi Motors Corporation reportedly agreed to collaborate on procurement, developing common technical platforms, sharing technology, sharing factories and developing a common strategy for emerging markets.
According to Japanese law, 34% of the shares is a lot, the so-called blocking stake, which allows you to prevent the implementation of any decisions that do not suit the shareholder. In many cases, such a stake is sufficient for full control of the company, but Mitsubishi has other large shareholders who own about the same number of shares. Let me remind you that Mitsubishi used to be a huge business empire, which after the end of World War II was divided into 44 industry companies, Mitsubishi Motors is just one of them. However, the ties between the firms have survived and they continue to hold each other's shares. So a large stake in MMC belongs to the giant Mitsubishi Heavy Industries Ltd, and the total stake in Mitsubishi Motors, owned by fragments of the Mitsubishi empire, is estimated at the same 34%.
Nissan buys Mitsubishi shares at a bargain price. More recently, they cost almost one and a half times more expensive, but the company was crippled by a fuel scandal. It turned out that MMC underestimated the data on fuel consumption, stock prices collapsed. The company is in serious trouble. Immediately on a white horse came Nissan with its billions. This gave rise to evil tongues to say that the scandal was initiated by the main beneficiary of the deal (the companies have been in partnerships for five years and have access to each other's proprietary information).
Why does Nissan need a small Mitsubishi company by its standards? The fact is that it is small, but in Southeast Asia and especially in Thailand, Mitsubishi's position is much stronger than that of its older partner. In addition, the Mitsubishi pickup truck line looks more interesting.
The Renault-Nissan alliance partnership with Mitsubishi will allow it to more confidently measure production volumes with the leaders of the automotive market. Renault-Nissan produced 8.5 million vehicles last year, MMC about 1 million, together they are not so far behind Volkswagen and Toyota, each of the companies produces about 10 million cars a year. The new deal continues the "soft merger" strategy pursued by the head of the Renault-Nissan alliance, Carlos Ghosn.
For Mitsubishi, this partnership means solving financial problems, gaining access to modern technologies, especially new engines, and great progress in the development of electric vehicles. Also, together with the Renault-Nissan alliance, it will be easier to develop a system of autonomous, without human intervention, driving. Mitsubishi itself simply would not have had enough money to solve all these important tasks. You can not discount access to new markets, where the position of Mitsubishi is weak, and Nissan, on the contrary, is strong. Fans are also hoping that Nissan's move will revive the popularity of past legends such as the Mitsubishi Evolution. In much the same way, BMW breathed new life into the MINI.
For Russian buyers, the creation of a new alliance is unlikely to change anything for the better. At first, nothing will change at all. In the future, the dealer network can be optimized, but in the current conditions this is unlikely to affect prices, and we cannot expect a significant change in the level of service either. As for the lineup, at first decisions useful for consumers can be made, for example, ASX will be returned to the Russian market. In the future, judging by the experience of other large alliances, cars produced under different brands become twins from a technical point of view, while models of the same class differ only in appearance, some settings and equipment. Moreover, it is clear that the filling in Mitsubishi will be from Nissan, and not vice versa.
It is assumed that the final agreement on the formation of the alliance will be signed on May 24, and all legal formalities will be settled before the end of this year.
Pictured is the Nissan IDS concept. (c) the Russian representative office of Nissan
Previously, a possible deal was reported by the media with links to sources. The companies later made separate statements on the Tokyo Stock Exchange and stressed that no decision had yet been made, Bloomberg reported. The boards of directors of each company were supposed to discuss the situation on May 12. Earlier, the media reported that Nissan could buy a 33% stake in a competitor, which is now worth about $1.5 billion according to the market. yen. Negotiations are at an early stage, according to official press releases. According to the Nikkei and Reuters, we are talking about the final rounds of negotiations. According to Bloomberg sources, several other companies, including China's BAIC Motor, are also exploring the possibility of buying a stake in Mitsubishi.
Nissan will become the largest co-owner of the company-competitor, notes WSJ. Once Nissan owns more than a third of Mitsubishi, it will have veto power under Japanese law over significant decisions regarding the company. The publication believes that, in general, the transaction will entail a restructuring in the automotive market in Japan, where eight automakers are now operating. The deal will give Nissan a chance to expand its footprint in some markets in Asia where its cars are under-represented, and Mitsubishi, which is well-positioned in Asia, could benefit from Nissan's growing market share in North America.
On April 20, Mitsubishi Motors admitted that its employees underestimated the fuel consumption of cars during tests. The discrepancy between the declared and actual fuel consumption figures was discovered by Nissan, for which small cars were produced, the company said. Then Mitsubishi Motors admitted that the miscalculation of fuel consumption has been practiced for 25 years.
Nissan and Mitsubishi Motors have an NMKV joint venture that develops minicars under the two companies' brands, and the companies will expand their current partnership, Nissan said. Sales of these models were suspended at the end of April after the start of the fuel consumption scandal. Masuko told reporters on May 11 that his company wants to keep its partnership with Nissan. He also said that the company has enough cash to cover the costs associated with the fuel fraud scandal. At the same time, Mitsubishi stated that it would not ask for help from Mitsubishi Group companies - Mitsubishi Heavy Industries and Mitsubishi.
Collaboration with Mitsubishi to develop and manufacture minicars is very important for Nissan as the segment accounts for about 40% of sales in the local market. Nissan abandoned its own small car business in favor of a joint venture with Mitsubishi in 2010.
Even more important for companies could be the ability to pool resources to develop electric vehicles, a technology that both car companies are putting at the center of their growth strategy. "It's an easy way to get a positive result," Kurt Sanger, a leading automotive analyst at Deutsche Securities, told Automotive News. “After all, it is much more than the Japanese minicar market.”
Amid reports of fraud with fuel consumption, Mitsubishi Motors quotes fell by about 45%. On May 12, these securities were not traded, Reuters notes. According to the WSJ, on information about a possible deal, Nissan shares fell 2.4% on Thursday morning. Analysts estimate that Mitsubishi will have to spend about $1 billion to compensate minicar buyers in Japan and refund tax breaks and overheads.
Nissan investors may have to wait for clarifications on the terms of the deal, which will deal with the risks and consequences of the fraud scandal, expert Joe Phillippi from AutoTrends Consulting commented on Bloomberg talks. In his opinion, because of this, the transaction will have an unusually large number of stipulated conditions in case of any possible complications, and all this will affect the price that the buyer will offer.
While the largest shareholder in Mitsubishi Motors is Mitsubishi Heavy Industries, which owns about 20% of the automaker, Mitsubishi Corporation owns 10%, Tokyo-Mitsubishi UFJ Bank - about 4%. Mitsubishi group companies rescued the automaker in 2004 by buying out its preferred shares after the termination of the partnership with DaimlerChrysler. About two years ago, the automaker returned the debts to the companies, but three of them retained a total of about 34% in Mitsubishi Motors.
Nissan's largest partner is Renault, which owns a 43% voting stake in the Japanese automaker. Nissan, in turn, controls a 15% non-voting stake in Renault.
