Nissan Hesitant on GM Alliance, Eyes "Serious" Discussions

Strategic Insights -

Nissan Motor Co. Co-Chairman Itaru Koeda stated that the Japanese automaker will not necessarily invest in General Motors Corp. in the ongoing talks about a possible three-way alliance with Nissan, General Motors, and Renault S.A. The alliance, if realized, is expected to create mutual benefits in nearly 10 operational areas, including joint parts procurement and consignment of production activities. Nissan, Renault, and GM have formed teams to discuss different operational areas, with each team consisting of one expert from the three automakers. Koeda emphasized that the alliance would not likely lead to an immediate increase in earnings, requiring at least three years to "bear fruit."

Key Takeaways:

  • Nissan Co-Chairman Itaru Koeda expressed hesitation on investing in General Motors Corp. in the ongoing talks about a possible three-way alliance.
  • The alliance is expected to create mutual benefits in nearly 10 operational areas, including joint parts procurement and consignment of production activities.
  • Nissan, Renault, and GM have formed teams to discuss different operational areas, with each team consisting of one expert from the three automakers.
  • Koeda stated that the alliance would not likely lead to an immediate increase in earnings, requiring at least three years to "bear fruit."
  • Nissan has set Oct. 15 as the deadline for the current 90-day negotiations, with talks to move onto the next phase to map out specifics of their business strategies if the partnership is decided.
  • The alliance will involve serious discussions, with all members examining whether their possible alliance can create mutual benefits.

Statistics:

  • Nissan has set Oct. 15 as the deadline for the current 90-day negotiations.
  • The alliance is expected to create mutual benefits in nearly 10 operational areas.
  • Nissan, Renault, and GM have formed teams to discuss different operational areas, with each team composed of one expert from the three automakers.
  • The alliance is unlikely to lead to an immediate increase in earnings, requiring at least three years to "bear fruit."
  • 90 days of negotiations have been allocated to discuss the possible alliance.

Sources:

  • "TOKYO -- Nissan Motor Co. Co-Chairman Itaru Koeda said Wednesday that the Japanese automaker will not necessarily stick with the idea of investing in General Motors Corp., referring to ongoing talks on a possible three-way alliance between Nissan, General Motors and Renault S.A. September 13, 2006."

+ Source: Kyodo News International, Tokyo