Customers can benefit from the planned merger of the two Japanese car manufacturers thanks to accelerated development and greater efficiency. But the merger will take energy and, above all, time. That's exactly what's missing.
Nissan boss Makoto Uchida (l.) and Honda CEO Toshihiro Mibe are planning a merger. They want to become more competitive, especially when it comes to electric cars.
The two Japanese car manufacturers Honda and Nissan are currently presenting themselves strangely. Not only are their market shares dwindling in all markets, they are also increasingly falling behind technologically.
Honda had entered into a cooperation with General Motors to become a leader in autonomous driving. But GM canceled its robotaxi program with its subsidiary Cruise after development setbacks and an incident in San Francisco. The driverless minibus project planned by Honda has become obsolete because it lacks the cruise technology.
Nissan carelessly gave up its lead in the development of electric cars when it formed an alliance with Renault in 1999. The Leaf was the first battery-electric mass-produced car 15 years ago. But Nissan didn't develop it further for years. At the same time, Renault developed its own electric cars and established technology leadership in the alliance. As a result, Renault is now one of the leading electric car manufacturers, while Nissan is languishing with two aging electric vehicles.
Certainly, the situation is different in Japan. Vehicles with hybrid drives are particularly important here, and Honda and Nissan have products on the market. But Nissan in particular failed to bring these models to markets such as the USA – and was left behind by the competition here too. The domestic market will not save Honda or Nissan.
Large backlog of battery electric cars
The chefs of the two car manufacturers should focus their attention on the large car markets of China, North America and Europe. This is where the two traditional Japanese brands are lagging behind. There is no platform for electric cars that would serve as a common basis for cars of different sizes. This makes it difficult for the Japanese in the Chinese and European markets, where battery cars will soon take over.
Battery technology is also still a closed book for the two Japanese. Manufacturers from China and South Korea have steadily expanded their lead, and Europe and the USA are currently following suit. However, there is a high pace of development in this area in particular – it will be difficult for Honda and Nissan to keep up.
When it comes to technology and sensors, for example for highly automated driving, there are Japan-specific backlogs that Honda wanted to make up for through collaboration with GM. There is currently no valid sensor manufacturer for autonomous cars in Japan. They can be found in Europe, Israel and especially the USA and have to be purchased expensively. The Japanese competitor Toyota also suffers from the same problem. And what they all have in common is the lack of know-how in software development, which is abundant in China, for example.
It depends on the acceleration ability
A new beginning doesn't work at Nissan like Honda either. It should now succeed together, but to do this, two lame car manufacturers must quickly become a merged top athlete that will quickly live up to its reputation as the third largest car company in the world. New platforms and products need to be developed together to create economies of scale.
First and foremost, the two Japanese companies must make a special effort to shorten the gap to the world's technological leaders. Honda and Nissan automatically make it onto the podium of the best-selling car companies through a merger. But they don't just achieve lasting success through high volumes, as Nissan boss Carlos Ghosn used to propagate. Product quality is even more important. The former alliance partner Renault is currently demonstrating this.
What Honda and Nissan need is a fresh offering that is technologically suitable for all markets in which the two Japanese manufacturers operate. The merger makes the company disgusting. But it has to be at the forefront and at the bottom technologically. There is a risk that the pursuit of size will cost the company too much time. And the pursuit of technological advancement fell by the wayside.
