Auto expert Mike Caudill joins ‘The Big Money Show’ and explains why automakers are slowing down the production of electric vehicles.
Honda and Nissan are reportedly considering it possibility of mergerSpeculation has run rampant about what the potential move could mean – but experts say the partnership rumors are no surprise.
News of the merger talks, which was first reported by the Nikkei newspaper on Tuesday, comes as both Japanese auto giants struggle to compete with the biggest global electric vehicle (EV) makers. including tesla and Chinese automaker BYD.
Nissan and Honda are reportedly discussing a possible merger. (Getty Images/Getty Images)
While neither Honda nor Nissan have confirmed merger discussions, Brian Moody, executive editor of AutoTrader and Kelley Blue Book, predicted about a year ago that these types of partnerships would become more frequent as the companies could pool resources. And can pay the cost.
Moody said fox business In an interview he said that it’s one thing if a small brand says it’s going to be all-electric, but for a big company to do that is a huge undertaking that requires a huge amount of research and development. Is.
Honda recalls approximately 206K vehicles due to possible fuel leak
Honda and Nissan are the second and third largest auto manufacturers in Japan respectively, with Toyota leading both of them.
Rumors of a possible merger between Honda and Nissan are no surprise. (Yoshikazu Tsuno/AFP via Getty Images/Getty Images)
Honda and Nissan’s respective market capitalizations are about 5.95 trillion yen ($38.8 billion) and 1.17 trillion yen ($7.6 billion).
“a company like honda “They may not be able to do it on their own, but at the same time, Honda has some attractive products, so I think they both bring some important things to the table,” Moody said.
He added, “But the big thing is to pool resources so that (they) don’t make bad business decisions for a technology, electric cars, that is growing — but not growing as fast as people thought or expected.” “
According to Brian Moody, executive editor of AutoTrader and Kelley Blue Book, one possible outcome of a potential Honda-Nissan merger could be less expensive EV options. (David Paul Morris/Bloomberg/via Getty Images)
So what could the merger potentially mean for consumers? Moody’s says he can see value in smaller, less expensive electric cars coming from such a deal.
Get Fox Business by clicking here
“I can also see such mergers or partnerships resulting in low-cost sub-brands,” he said. “Because that’s what we’re hearing, is that a lot of people, a lot of consumers are saying, ‘You know, new cars are too expensive. I can’t afford a new car.'”
Fox Business’ Andrea Margolis and Reuters contributed to this report.
