Could Japanese carmakers rally together to push the pedal on electric vehicles (EVs), a fast-emerging market in which they lag their overseas rivals? Honda and Nissan are reported to be exploring a merger. The two are Japan’s second- and third-largest carmakers, respectively.
In March, the duo forged an EV partnership. While their headquarters only confirm further talks, Nissan’s biggest shareholder Renault is said to be open to the idea and now stock markets seem to be betting on the two merging to form a $54 billion business, the world’s third biggest auto group by sales after Toyota and Volkswagen.
Nissan’s stock zoomed while Honda’s slid, a sign of it being interpreted as a Nissan bailout. Faced with Chinese EVs zipping ahead, Japanese carmakers must decide whether to abandon their big bet that hybrids would lead the auto sector’s conversion to clean energy.
If charging infrastructure sprouts globally, direct switchovers to EVs may accelerate, leaving them further behind in the race.
As in Formula 1, bends along the track often reshuffle the top order. A carbon shock could yet take away the competitive edge that an oil shock gave Japanese carmakers half a century ago.
