What started as a rumor at the beginning of the week is now official. The Honda-Nissan alliance announced in March is widening to include another Japanese automaker–Mitsubishi. The three have signed a memorandum of understanding to discuss the best way to jointly work on electric vehicles and software. Takao Kato, Representative Executive Officer, President and CEO, Mitsubishi Motors:
"Nissan and Honda's discussions on a possible partnership have progressed, and we have decided to participate in this framework. Collaboration with partners is essential in today's automotive industry, which is undergoing rapid changes due to technological innovations such as electrification and intelligence. We believe that we can discover new possibilities in a variety of fields through collaboration among the three companies."
In related news, Nissan and Honda have issued a separate press release discussing an agreement the two have reached to channel their efforts to develop software-defined vehicles (SDVs). The two will pool money into software to improve autonomous driving technology, connectivity, and artificial intelligence. The cooperation will also include the joint development of new batteries and electrically driven axles by sharing motors and inverters.
Interestingly, Nissan and Honda have also agreed to share models and complete each other's lineups, both with combustion cars and EVs. Since Mitsubishi has just signed the MoU, it's premature to say whether it too will be included in this strategy officially dubbed as "mutual vehicle complementation." It's worth noting that Nissan has a 34 percent stake in Mitsubishi.
The expanded alliance makes sense given the rapid rise of EVs from China. Instead of working entirely on their own—a lengthy and costly endeavor—the three companies are joining forces to accelerate development and achieve economies of scale. Honda, Nissan, and Mitsubishi must face increasingly tougher competition as electric cars from China are significantly cheaper and more diverse.
Will something exciting come out of this widened partnership? It doesn't look like it, at least not right now. There's sadly no mention of a sports car to replicate the success Toyota and Subaru have had with the GR86/BRZ. The cruel reality is that there's more money to be made with mainstream cars, particularly crossovers and SUVs.
This isn't the first major alliance between Japanese automakers announced this year. A couple of months ago, Toyota, Mazda, and Subaru held a joint conference to express their long-term commitment to combustion engines. The three aim to prolong the life of ICEs through hybridization and carbon-neutral fuels. Toyota is working on several inline-four engines while Mazda will continue to improve the rotary for range-extending EVs. Subaru is making its horizontally opposed boxer run cleaner.
