Nissan and Mitsubishi to deepen business ties

Nissan Motor Co. and smaller rival Mitsubishi Motors Corp. will deepen business ties to get ahead in the fiercely competitive global car industry, including establishing a minicar joint venture in Japan that could eventually expand to other countries.

In the agreement announced Tuesday, the two Japanese automakers will also make more cars for each other under what is known as an "original equipment manufacture" or OEM partnership. Under such a deal, one automaker supplies vehicles to another automaker to sell under its own brand, enabling companies to lower production costs through economies of scale.

Nissan will produce a small van to be sold under the Mitsubishi brand for the Japanese market, while Mitsubishi will make an SUV sold under the Nissan brand in the Mideast, the companies said.

To cope with capacity shortfalls in Thailand, Nissan will shift production of its brisk-selling Navara pickup truck to Mitsubishi’s plant in Thailand, said Nissan CEO Carlos Ghosn. It may collaborate on a new one-ton pickup model as well.

"In the global auto industry, cooperation on specific projects among automakers is becoming increasingly common," Ghosn said at a joint press conference with his Mitsubishi counterpart.

"It is, in fact, a signal of how our industry is evolving to sustain success over the long term, by leveraging size, scale and investments more effectively to create more value," he said.

Read the rest of the story: Nissan, Mitsubishi to expand business tieup.

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