Mitsubishi Motors is set to join the Honda-Nissan alliance, solidifying Japan's domestic market into two dominant groups: the Toyota Motor Group and the newly formed Honda-Nissan-Mitsubishi alliance, which collectively sell over 8 million vehicles globally, according to Nikkei Asia.
This strategic move comes at a critical juncture as Tesla and Chinese automakers heavily invest in electric vehicles (EVs), pressuring Japanese manufacturers to scale up and enhance their supply chains. The reorganization is expected to have widespread implications across various sectors in Japan.
While Honda and Nissan announced a comprehensive cooperation agreement in March, Mitsubishi Motors' role within this framework remained uncertain. With Nissan holding a 34.01% stake in Mitsubishi Motors, integrating Mitsubishi into the alliance aims to boost competitiveness in a challenging market. The three companies will now collaborate closely to strengthen their market position.
Negotiations have been ongoing, with Mitsubishi Motors signing a nondisclosure agreement with Honda and Nissan. In the fiscal year ending March 2024, Honda and Nissan recorded global sales of 4.1 million and 3.44 million units, respectively. Combined with Mitsubishi Motors' 810,000 units, the alliance's total sales reach 8.35 million vehicles.
In contrast, Toyota, Japan's largest automaker, has formed alliances with Daihatsu, Suzuki, Subaru, Mazda, and Hino Motors, achieving a combined sales volume of 16 million units. This places the Honda-Nissan-Mitsubishi alliance in direct competition with Toyota's extensive network.
The driving force behind this alliance is the urgent need to adapt to a rapidly changing auto industry, marked by the shift from internal combustion engines to EVs.
Japanese automakers face significant challenges from emerging players in the EV market. In 2023, Nissan and Honda sold only 140,000 and 19,000 EVs worldwide, respectively, compared to Tesla's 1.8 million and BYD's 1.57 million units. In China, the world's largest car market, Honda and Nissan have struggled to compete against low-priced local EVs, prompting a reevaluation of their market strategies.
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