We’re being washed over with giant waves of what can be called “green car” news.
Audi and General Motors just issued their latest sustainability reports; BMW has announced a big-battery i3; Tesla has sparked fevered interest in the promised Model 3; Ford is developing an electric vehicle (EV) to compete with the Chevrolet Bolt and the Model 3; and on and on.
But the most intriguing development in the EV universe comes disguised as a corporate takeover. Nissan Motor is assuming control of Mitsubishi Motors, in essence forging a three-way alliance with European partner Renault.
Renault-Nissan CEO Carlos Ghosn has framed this move as a way to save scandal-hit Mitsubishi. By taking a 34 per cent stake in Mitsubishi for what really is a paltry $2.18 billion (US), Nissan assumes control under Japanese corporate law.
“Nissan is determined to preserve and nurture the Mitsubishi Motors brand,” says Ghosn. “We will help this company address the challenges it faces, particularly restoring consumer trust in the fuel-economy performance.”
Mitsubishi is coping with a scandal about which few in North America know. The company has admitted to inflating fuel economy ratings for small cars sold in Japan. (Mitsubishi says an internal audit found no irregularities with cars sold in Canada and the United States.)
On the surface, it appears Nissan is making this move out of immediate self-interest, while in the long term seizing on a cheap opportunity to expand its global footprint. But more is at work, I am certain. The as-yet untold story is about Nissan getting access to Mitsu’s impressive EV expertise.
I believe this because Ghosn is a tight-fisted strategic thinker, a man who led Nissan out of its 1999 near-bankruptcy with a laser-like focus on fiscal prudence, demanding but achievable and very public goals, and most of all an investment in products – including the Nissan LEAF, the best-selling EV in history with more than 200,000 sold worldwide.
Of course, before he can shift focus to EVs, Ghosn’s first job with Mitsubishi is to fix the Nissan Dayz minicar problem. The Dayz is built by Mitsu and sold to Nissan under contract.
This scandal is embarrassing for Nissan, but potentially catastrophic for Mitsu. It “could affect our company’s existence,” Mitsubishi President Tetsuro Aikawa said during a press conference in Tokyo, according to Bloomberg.
Mitsubishi does not have the deep pockets needed in this crisis. Nissan does, having just reported an operating profit of $6.8 billion (US). Ghosn knows crisis management and will steer Mitsubishi to restored consumer confidence. Indeed, Ghosn has headed a Renault-Nissan that has been remarkably scandal- and debt-free.
Ghosn is a tough boss, thorough, demanding, whip-smart and unrelenting. That said, he’s nurtured a diverse executive team, rewards success and is not known to be a micro-manager.
Ghosn’s biggest problem has been a reluctance to leave his job. This has forced some of the best Renault Nissan executives to leave for other car companies where they can finally run their own shows.
Carlos Tavaras, once referred to as Little Carlos as a possible successor to Big Carlos, is engineering a remarkable turnaround at PSA. Andy Palmer, Nissan’s former head of product development, is now fixing Aston Martin as CEO. Both are putting great emphasis on electrification in their new roles and credit Ghosn for his leadership.
To understand Ghosn’s interest in Mitsubishi, go back to the 2015 Tokyo Motor Show. There, to celebrate the company’s 50th anniversary of EV research and development, Mitsubishi showed the eX Concept with its next-generation EV system and “twin-motor” all-wheel-drive system.
The eX boasts a high-capacity lithium-ion battery with powerful electric motors and a range of 400 km or 250 miles. We have every reason to believe Mitsu is serious about bringing this technology to market. This is, after all, the company that long ago put the highly affordable i-MiEV on sale here in Canada and around the world.
So Mitsubishi’s EV cupboard is brimming with interesting ideas and technologies. The Mitsubishi takeover gives Nissan access to all of it – a massive coupe for a Renault-Nissan Alliance that through the end of 2015 had sold 302,000 all-electric cars.
The EV world just tilted slightly in Renault-Nissan’s favour – Mitsubishi’s, too.