Revelations this week that Honda and Nissan are in merger talks should come as no surprise: The canaries have been dying in the automotive industry’s version of coal mines for some time.
Stellantis, the parent company of Chrysler, Jeep, Fiat and Peugeot, shocked investors in October with an earnings warning reflecting weak demand and rising inventories, particularly in the all-important U.S. market, and the looming threat of Chinese exports. The situation was so dire – and without a credible path to a solution – it cost CEO Carlos Tavares, one of the auto industry’s visionaries, his job.
That’s because for Nissan, this is a case of surviving, not thriving. The automaker has been struggling, with a lineup of unpopular models, a consistent failure to command a strong presence in the all-important North American market, and a complicated financial tie-up with Renault that includes interest by the French government.
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