While this is HN so any automotive conversation inevitabely becomes an ideological war between EV vs ICE fanatics, this didn't play as significant a role in the failure of Nissan and Honda's merger.
As stated in the article - "the merger talks unravelled in a little more than a month due to Nissan's pride and insufficient alarm about its predicament"
More critically, Japanese automakers have always tried to diversify away from Japan as part of the "Flying Geese" paradigm.
For example, Toyota and Honda truly became "American", Mitsubishi truly became "Southeast Asian" (Indonesia, Philippines, Thailand, Vietnam), Isuzu became "Thai", and Suzuki became "Indian".
Nissan on the other hand tried a foreign expansion with the Datsun in the 1960s-80s, but that crashed and burned horribly, and reduced their appetite to expand abroad.
Post-Datsun, most of their international expansion tied their future to Brazil, China, and India as part of the Renault-Nissan partnership under Carlos Ghosn, but that itself came very late (early 2000s) and other players (domestic, international, and Japanese) were well established in those markets already.
Furthermore, Nissan Group's prestige division Nissan Shatai is too entwined politically to Kyushu, which scuttled the merger as Honda would have shut down Nissan's Kyushu factories which represent much of Nissan's capex.
Fundamentally, Nissan's leadership has a low appetite of taking risks abroad after the failure of Datsun, and this would have been toxic for an internationally minded Japanese firm like Honda who has stronger PMF abroad compared to domestically in Japan.
I think it's more realists vs. at this point the clearly losing ICE proponent side. The EV market grows double digit percentages every year. Mostly at the cost of the ICE car market. Even last year when lots of the ICE manufacturers insisted the EV market was 'shrinking' (no such thing happened), the EV market actually expanded by about 20% globally. And since the overall car market did not grow by such numbers, guess where all that growth went: not them.
Japanese companies like Nissan and Honda are a bit on that losing side. Quite literally; both are struggling with rapidly reducing demand for their now clearly obsolete vehicles and the ramp up of the production of competitive EV replacements for those.
Nissan basically dialed back investments after they got rid of Ghosn and the collaboration with Renault. Which was actually producing some early successes. Like the Nissan Leaf. They could have doubled down on that but they didn't.
Now years later they are basically facing a lot of issues with with an outdated product portfolio that can't keep up with new EVs from others grabbing lots of their market share in most of their key markets.
The reason the Nissan-Honda merger was on the table at all is that it really has gotten that bad for both of them. And of course merging two poorly performing companies doesn't result in a situation where the sum of the parts is larger than the value of the parts.
The reason this deal bounced (and was probably a bad idea to begin with) is that Nissan is in denial about their existential need to adapt to the changing market. EVs are at the center of that.
>While this is HN so any automotive conversation inevitabely becomes an ideological war between EV vs ICE fanatics, this didn't play as significant a role in the failure of Nissan and Honda's merger.
I cant stand Teslas, and tesla look alikes, they feel like sitting inside of an iPad. I think GWM has the right of it. Just pump out hybrids and EV's that feel as much the same as an ICE vehicle as possible. Let the customer decide.
Mazda is also minority-owned by Mitsubishi Group and Toyota Group and co-owns plenty of plants with Toyota, so it's a different story from Nissan Group which retains independence.
At this point, Mazda is an OEM for Toyota Group, and previously they were an OEM for Ford.
TLDR; Mazda should merge with Nissan while they still can do it on a fire sale.
Mazda is a huge outlier in manfacturing because they are small, but have motorsports calibre/history (meaning they have a history of homologating sports cars.)
Mazda sells an order of magnitude less cars than even newer companies like BYD. Even less than isuzu. Because of this, they can more tightly control investor expectations, profit/loss. The stock value rarely changes, nevermind grows, so investors are confident in stability and dividends.
AKA, if you work at mazda, you aren't gonna be seen as a mega rich engineer. If you invest in mazda, you know you're gonna be able to sell at any point without much worry.
That said, I see no future for mazda beyond acqusition by chinese firm. It Manufactures in far too high COL countries, sells for too cheap, Self cannabalizing (9 different SUV models), too tight of a CUV market, lack of brand identity.....and the biggest issue, they cannot afford to r and d another miata gen, another RX-7,8 gen.
mazda desperetely needs a cash infusion, or joining into a much wider network with more selling power. Until then, I fear they will coast down the same road as Mitsubishi in the us.
> Mazda sells an order of magnitude less cars than even newer companies like BYD. Even less than isuzu.
Mazda sold 1.1M cars in 2023[1]. By comparison Nissan sold 2.9M, BYD 2.6M (obviously this is much less than an order of magnitude difference.
> Mazda is a huge outlier in manfacturing because they are small, but have motorsports calibre/history (meaning they have a history of homologating sports cars.)
Plenty of manufactures have motorsports history. Mazda has a Le Mons win, but apart from that nothing particularly of note. Notably Peugeot and Subaru both have much broader motorsports history and are smaller, and Renault has much much more impressive motorsport pedigree and only sells slightly more cars (1.4M in 2023).
> [Mazda sells an order of magnitude less cars than even newer companies like BYD. Even less than isuzu.] Because of this, they can more tightly control investor expectations, profit/loss. The stock value rarely changes, nevermind grows, so investors are confident in stability and dividends.
This is an argument that is rarely (never?) made, and not born out by the evidence.
Mazda's sales, profit and stock price have all been falling. Their stock price is down from 1700 Yen in 2024 to 1034 Yen today. It's difficult to say "the stock value rarely changes"
> If you invest in mazda, you know you're gonna be able to sell at any point without much worry.
Well if you don't worry about losing money I guess..
I think U.S.-centric readers may misunderstand Mazda. When I was in Singapore, I saw one example of them being quite popular abroad. In the U.S., they seem to be more of an enthusiast / novelty brand.
Last January, I threw Car & Driver stats for 2023 and 2022 best-selling models (from U.S. sales) in a spreadsheet. Mazda was the #12 OEM here, just below Hyundai. (Note this is only based on top 25 models.)
EDIT: Updated to add 2024 top 25.
In 2024, Mazda's CX-5 dropped off the top 25 best-selling, removing it from my spreadsheet.
03. Honda 807,519 11.8%
07. Nissan 398,383 5.8%
In 2023 Mazda increased their volume very slightly, while Nissan lost share, and Honda increased their share.
Wow. I just checked out a few random other markets including Japan, and it's crazy to me that Mazda isn't doing better. They've got some really nice cars. It's bizarre. I wonder if this is by design or they just can't market for shit?
Full disclosure: I'm a Honda driver and was a Toyota driver for many years before that.
As stated in the article - "the merger talks unravelled in a little more than a month due to Nissan's pride and insufficient alarm about its predicament"
More critically, Japanese automakers have always tried to diversify away from Japan as part of the "Flying Geese" paradigm.
For example, Toyota and Honda truly became "American", Mitsubishi truly became "Southeast Asian" (Indonesia, Philippines, Thailand, Vietnam), Isuzu became "Thai", and Suzuki became "Indian".
Nissan on the other hand tried a foreign expansion with the Datsun in the 1960s-80s, but that crashed and burned horribly, and reduced their appetite to expand abroad.
Post-Datsun, most of their international expansion tied their future to Brazil, China, and India as part of the Renault-Nissan partnership under Carlos Ghosn, but that itself came very late (early 2000s) and other players (domestic, international, and Japanese) were well established in those markets already.
Furthermore, Nissan Group's prestige division Nissan Shatai is too entwined politically to Kyushu, which scuttled the merger as Honda would have shut down Nissan's Kyushu factories which represent much of Nissan's capex.
Fundamentally, Nissan's leadership has a low appetite of taking risks abroad after the failure of Datsun, and this would have been toxic for an internationally minded Japanese firm like Honda who has stronger PMF abroad compared to domestically in Japan.