Nissan, Honda Plan for Partnership on Electric Car Production, AI Systems

Nissan and Honda are facing serious competition from global automakers like BYD and Tesla in the EV space

Yet another major alliance in the automotive world is on the horizon. Nissan and Honda are now planning to form a strategic collaboration for their electric vehicles and automotive software. The two Japanese auto giants will seek to produce key components for their electric vehicles (EVs), as well as build on artificial intelligence in automotive software platforms through the partnership.

The need for the alliance gems from the major competition that the Japanese auto majors are facing from global automakers like BYD and Tesla. Clearing the same in a statement, Nissan Chief Executive Officer (CEO) Makoto Uchida told a press briefing – “Emerging players are very aggressive and are making inroads at incredible speed. We cannot win the competition as long as we stick to conventional wisdom and traditional approach.”

Though the scope of the collaboration is yet unclear, the two companies have signed a non-binding memorandum of understanding to identify possible areas of partnership. Both companies are open to taking this partnership overseas other than their home country Japan. They are also open to a capital tie-up in the future, as Honda president Toshihiro Mibe said, “We are strapped for time and need to be speedy. In 2030 to be in a good position we need a decision now.”

Nissan-Honda partnership: What to expect?

Nissan Ariya
Nissan Ariya (Representative Image)

Since much of the partnership’s scope and details are yet unclear, only time will tell how the Nissan and Honda partnership pans out, if at all. As mentioned in a Reuters report, speculations at this point suggest that the companies might look to produce a common powertrain and platform for their electric vehicle lineup. Both Nissan and Honda currently offer compact electric cars for urban commuting, with the former having a stronghold with the Nissan Leaf in numerous markets across the globe. They may also seek to jointly procure the EV components and build new-age system software together.

As for their existing partnerships, Uchida cleared during the press brief that Nissan’s potential alliance with Honda will not affect its existing business alliances with Renault and Mitsubishi Motors.