Mitsubishi Motors Corporation (MMC) has officially announced Nissan as its largest shareholder with 34% shares purchased for 237 billion yen. Mitsubishi will now join the 17-year old and immensely successful Nissan-Renault Alliance as a partner-member. The combination of the three brands makes the alliance the third largest automotive group in the world. The company is now looking at achieving annual sales to the tune of 1 million cars, which is somewhat the territory the other two majors Toyota, and VW Group play in.
Also, Nissan-Renault CEO Carlos Ghosn has been declared the Chairman elect for Mitsubishi. Joining forces with Mr Ghosn will be three other Nissan nominated directors. Mr Ghosn will as nominees by Hitoshi Kawaguchi, Mitsuhiko Yamashita and Hiroshi Karube. The other stakeholders in MMC – Mitsubishi Heavy Industries, Mitsubishi Corporation and The Bank of Tokyo-Mitsubishi UFJ have supported Nissan’s investment.
Mitsubishi Motor’s president and CEO Osamu Masuko has requested that Nissan designate a senior executive to join Mitsubishi executive committee to strengthen MMC’s management. Trevor Mann, currently chief performance officer of Nissan, will become the COO of MMC.
The three companies will now work closely on a variety of programmes. To start of Nissan and Mitsubishi will work on a five-year alliance to develop a new generation minicar. The companies will also work on sharing their parts and components bin along with exploring joint purchasing to reduce costs. the companies will also work on joint production of vehicles, technology sharing and sharing product platforms.
Earlier this year, Mitsubishi drew a lot of flak for having admitted to manipulating fuel economy tests on its vehicles. This led to the resignation of the company’s Tetsuro Aikawa. A purchase by Nissan followed the crisis.