The Nissan-Honda Marriage Makes Sense For Insurers Too

The recent proposed merger of Nissan and Honda makes sense for both manufacturers of course; economies of scale, shared vehicle platforms, shared dealerships, parts supply chains, materials purchasing power and more. Then there are labour savings too – jobs will go, especially expensive jobs in the UK and EU zone. It is sad, but inevitable, otherwise both car companies will find themselves undercut by Chinese brands.

Gradual streamlining on parts supply, EV research and shared platforms on vehicle data could help insurers too. Much of the FNOL work is identifying exactly which spec a damaged vehicle conforms to. Tis is because two seemingly identical cars can have different ADAS systems, interior trims, lighting, sensors in bumpers etc. It makes a big difference when deciding on repair vs salvage.

All this is good news in the medium term, especially if some typical parts damaged in low speed accidents are shared between models, like steering racks, brake systems, fuel tanks – basically the stuff that isn’t visible on the outer profile, since lights, bumpers, indicators and wings tend to be used by designers to make three or four models from the same platform within one automotive brand.

Here’s the word from Nissan on the move;

Nissan Motor Co., Ltd. (“Nissan”) and Honda Motor Co., Ltd. (“Honda”) have signed a memorandum of understanding (MOU) to start discussions and considerations toward a business integration between the two companies through the establishment of a joint holding company.

To further accelerate their efforts toward achieving a carbon-neutral society and a zero-traffic-fatality society, Nissan and Honda signed an MOU on March 15 regarding a strategic partnership for the era of vehicle intelligence and electrification. Since then, the two companies have held discussions aimed at collaboration in various fields.

On August 1, both companies signed a further MOU to deepen the framework of the strategic partnership. The companies also announced that they had agreed to carry out joint research in fundamental technologies in the area of platforms for next-generation software-defined vehicles (SDVs), particularly in the areas crucial for intelligence and electrification, to advance focused discussions toward more concrete collaboration.

Throughout the process, Nissan and Honda have engaged in discussions in consideration of various possibilities and options. At the same time, the business environment for both companies and the wider automotive industry has rapidly changed and the speed of technological innovation has continued to accelerate. The MOU between Nissan and Honda announced today is aimed to serve as an option to maintain global competitiveness and for the two companies to continue to deliver more attractive products and services to customers worldwide.

If the business integration can be realized, both companies can aim to integrate their respective management resources such as knowledge, human resources, and technologies; create deeper synergies; enhance the ability to respond to market changes; and expect to improve mid- to long-term corporate value. Additionally, Nissan and Honda can aim to further contribute to the development of Japan’s industrial base as a “leading global mobility company” by integrating Nissan and Honda’s four-wheel-vehicle and Honda’s motorcycle and power products businesses, enabling the brands of both companies to become more attractive and to deliver more attractive and innovative products and services to customers worldwide.