MANILA: Nissan Motor Co. has finally taken a controlling stake in Mitsubishi Motors which is currently facing hard times in the global automobile market. The deal made with more than $2 billion aims to boost the reputation of Mitsubishi and improve its market share across the globe. What Renault has done to Nissan can be surely repeated with Mitsubishi, as Renault SA and Nissan is now among the top largest automobile groups of the world in terms of volume sales counting to 10 million vehicles per year.
The Renault-Nissan Alliance is one of the finest examples, which reflects how partnerships have helped automakers in scaling their models and cut costs in order to compete at a global level in an effective manner. This particular success of Renault-Nissan has further pushed other automakers to look for such tie-ups, which can be fruitful for both. With this acquisition, Nissan and Mitsubishi will swap technological know-how to make it more scalable. It will not only help in reducing the cost of development but will also help in deepening the roots in the global market.
Mr. Carlos Ghosn has been appointed as the new Managing Director of Mitsubishi Group, but Mitsubishi President and Chief Executive, Osamu Masuko will keep responsibilities for a transitional period and eventually will hand over the reins. At the press conference, he said, “We are going to show that Mitsubishi Motors has more potential than has been shown so far.” Mr. Ghosn has a successful portfolio of turnarounds at car companies, the biggest example is the transformation of Nissan, which was a struggling brand back in 1999 and now has become one of the leading profitable companies across the globe.
The management changes will be effective from November 1, which will allow Mr. Ghosn to assist the current Chief Executive of MMC group in shaping the company’s future in an efficacious manner. Now, only time will let us know how profitable this partnership will be for Mitsubishi and how it will improve the market share at a global level.