Developing and manufacturing new cars is expensive. You need a lot of volume to amortize the cost. That’s why more and more Japanese automakers skip the development and manufacturing part altogether. They outsource both and slap their badge on someone else’s car. Last in that development has been Mitsubishi. Ten days ago, Nissan and Mitsubishi snuggled closer and added more OEM deals to the ones they already had. Yesterday, it was announced that Suzuki would supply subcompact vans to Mitsubishi.
Suzuki will supply its latest 1.2 liter subcompact van Solio to Mitsubishi, which will start selling them as a yet unnamed Mitsubishi vehicle beginning in spring 2011. Just another OEM deal? Japan’s Yomiuri Shimbun sees a bigger picture.
The paper notes that “Mitsubishi is the third automaker that will sell Suzuki-manufactured cars as part of an OEM deal after Nissan and Mazda.” Then, the Yomiuri paper reminds the reader that there has been a similar deal between Toyota and Fuji Heavy, in which Toyota will produce future small Subarus. The paper sees a trend: Consolidation, Japan style:
Through OEM partnerships, the nation’s auto industry is gradually reorganizing into three groups–Toyota (with Daihatsu and Fuji Heavy), Nissan (with Mitsubishi Motors Corp, Mazda Motor Corp. and Suzuki) and Honda, which is independent.
By keeping open relationships, things stay spiced-up and interesting. Note that the paper sees Suzuki in the Nissan (and hence Renault) camp, and no mention of Volkswagen, which owns not quite 20 percent of Suzuki and is already getting impatient.