Nissan and Honda eye partnership in EV race

Chiang, Jen-Chieh, Taipei; Vyra Wu, DIGITIMES Asia 0

Credit: AFP

In a bid to navigate the increasingly competitive landscape of electric vehicle (EV) transition, Japanese automotive titans are showing signs of forging strategic partnerships.

Recent reports from prestigious sources like Nikkei and TV Tokyo indicate that Nissan is contemplating a collaboration with Honda in the realm of EVs. This potential alliance between Japan's second and third-largest automakers could herald significant shifts in the global automotive arena.

Insiders privy to the matter reveal that Nissan broached the subject of collaboration with Honda during a pivotal board meeting held on March 12, 2024. Following deliberations, the company secured approval to move forward and is now poised to explore formalizing this arrangement through a non-binding Memorandum of Understanding (MoU).

While specific details of the collaboration are still under wraps, Nissan is keen on exploring avenues for standardization and joint procurement of critical EV components, such as the drive system (e-Axle), in tandem with Honda. Moreover, joint initiatives in designing and developing EV platforms are on the cards.

However, it's important to note that discussions are in nascent stages, with the proposal originating from Nissan's end and Honda yet to commit. Negotiations could encompass battery procurement for EVs and collaborative ventures in Hybrid Electric Vehicle (HEV) development.

The intensified competition in the EV market, fueled by the rise of industry stalwarts like Tesla and BYD, underscores the urgency for strategic alliances. China's ascendancy in global automotive exports, surpassing Japan in 2023, further accentuates the imperative for Japanese automakers to recalibrate their strategies.

Despite Japan's prowess in hybrid technology, the relatively sluggish pace of EV development has prompted a reassessment of strategies. Japanese automakers face stiff competition from Chinese EVs, even in traditional strongholds like Southeast Asia. This, coupled with the gradual erosion of market share for Japanese battery manufacturer Panasonic by Chinese and South Korean rivals, underscores the need for proactive measures.

Against this backdrop, Nissan and Honda are contemplating production capacity reductions in China, a response to dwindling sales that have left their manufacturing facilities underutilized. The focus now shifts to optimizing resource management efficiency through integration and bolstering cost competitiveness.

As the automotive industry braces for a seismic shift towards electrification, collaboration emerges as a strategic imperative for Japanese automakers navigating this transformative landscape.