|Mitsubishi’s biggest single shareholder is Mitsubishi Heavy Industries (MHI), which owns about a 20 percent stake in the company.||Paul Newton, director, World Markets Analysis at IHS Automotive, looks at the implications of Nissan’s investment in Mitsubishi|
Mitsubishi Corporation holds a 10 percent stake, while the Bank of Tokyo-Mitsubishi UFJ, owned by Mitsubishi UFJ Financial Group, holds about a 4 percent stake. Nissan is already in a vehicle development and manufacturing partnership with Mitsubishi.
The companies established a joint venture (JV), NMKV Co., Ltd, in June 2011 to develop both companies’ minicar business in Japan. Although the purchase by Nissan is expected to bolster economies of scale and create synergies in areas including platform sharing, sport utility vehicles (SUVs), and pick-up trucks, and in markets such as Southeast Asia, the true cost of the scandal affecting Mitsubishi is still unclear.
However, the 34 percent stake allows Nissan to remain outside of the liability threshold for Japanese companies. The purchase will give them an effective controlling stake and is somewhat opportunistic as USD2.2 is not a huge sum for such a significant chunk of the company and could be seen as something of a bargain.
Mitsubishi’s share value has sunk in the region of 43 percent since the scandal broke. Trade in Mitsubishi stock was suspended today in Tokyo after it reached the daily limit following a flood of investors looking to buy on the news. Despite the apparent opportunistic nature of the move, the investment has a wider and more long-term rationale in areas of new technology and future platform development/sharing.
Mitsubishi’s plug-in hybrid technology compliments rather than competes with Renault-Nissan’s electric vehicle technology. In the profitable segments of pick-ups and SUV’s there is significant opportunity to develop platforms which will gain from the additional economies of scale selling across two/three brands (Renault is moving increasingly into SUV and Crossovers).
For reference, 2015 global light vehicle production for the top manufacturers is as follows:
|Ranking||Vehicle Production: Sales Parent||CY 2015|
Source: IHS Automotive Global Light Vehicle Production up to April 2016