Wyoming | The western news coverage of this proposed "merger" fails to take into account the Japanese business model known as the keiretsu. A keiretsu is a tightly-knit group of companies, which can be vertically integrated or horizontally dispersed, which also have government representatives assigned to them to knock down barriers in regulation/laws/exports. Included in a keiretsu will be raw material sources, manufactured input sources, electronics, banking, etc resources that are part of the same large "umbrella" of businesses. If you search the 'net, you can learn quite a bit about Japanese business structures. OK, back to the matter at hand: Nissan and Honda. Honda has a keiretsu of their own for the Honda group. It's much smaller than the keiretsu for the Mitsubishi group, which is huuuuuge. Mitsubishi is one of the monster, sprawling groups in Japan that crosses all manner of boundaries, both vertical and horizontal. People sound worried about a "huge conglomerate" taking over. Well, I've got news for you: Mitsubishi is already huge. For most people who don't look too closely at Japanese industry, you have no idea how huge Mitsubishi is. Nissan is one of the very few Japanese auto companies that broke out of the keiretsu structure about 25 years ago, and they've been trying to partner with European auto groups (Renault) for years, unsuccessfully. So now, you have two corporate giants, with their keiretsus, looking to integrate Nissan into their operations. This would likely re-invigorate Nissan, because banking/finance is one of the components of a keiretsu, for the benefit of the member companies. They would also share lots of raw materials and input component sources, thereby reducing costs from where Nissan is now. |