Nissan and Japanese automaker Honda will officially begin discussions on a acquisition to increase their standing in the field of electric vehicles, where Chinese brands are vying for supremacy.
At the same time, Chinese technology behemoth Foxconn has approached France’s Renault to get its huge interest in Nissan, according to Taiwan’s Central News Agency.
Here are some important points:
“SEVERE SITUATION”
Some automakers are struggling because of the low client spending and fierce competition in various markets.
In China, where electric car manufacturers like BYD are leading the charge as demand for less destroying cars rises, company has been particularly difficult for foreign companies.
China surpassed Japan as the biggest supplier of electric vehicles next year, thanks to the government’s support for Vehicles, a sector where Chinese companies have lost ground by concentrating on hybrids.
Germany’s Ford and the Stellantis party are also among those suffering, but Nissan in November warned of a” serious position” as it announced 9, 000 work breaks.
Samsung Attention
Nissan has endured a stormy generation, such as the 2018 arrest of former director Carlos Ghosn, who afterwards jumped bail and fled Japan hidden in a music gear box.
But, it last month reported a 93 per share fall in first-half gross income. Additionally, it is burdened with billions of dollars in debt, which is expected to adult over the next two years.
Therefore, a merger with Honda might be good for Nissan, but other businesses have also seen an option.
Foxconn, which builds tools for tech businesses including Apple’s iPhones, repeatedly approached the company with a charge to acquire a lot interest, according to Bloomberg News.
Previous Nissan professional Jun Seki of Foxconn visited France to request Renault sell its 35 % interest in Nissan, according to a report in Taiwan.
HONDA’S Market OF Level
A consolidation with Nissan was one of the “possibilities for participation” between them, according to a Honda official who told AFP.
According to Japanese media, the pair may begin the merger negotiations on Monday ( Dec 23 ).
Toyota’s top two manufacturers and three competitors already made an agreement in March to look into developing a strategic relationship with EV parts.
In August Mitsubishi Motors, of which Nissan is a lot investor, joined the program.
” The escalating prices of EV and cell growth, coupled with the disposal of used chargers, highlight the necessity of engagement to control risks and reduce the financial hardship”, Tatsuo Yoshida, of Bloomberg Intelligence, told AFP.
A merger will allow Honda to “benefit from level of business in terms of slashing expenses and expanding lineups,” according to Seiji Sugiura of Tokai Tokyo Intelligence Laboratory.