Automotive companies seems to be in a race to consolidate; with Toyota recently partnering up with Suzuki and Nissan planning to take control of Mitsubishi, Honda is starting to look a little lonely all by itself.
By coming together in a technological partnership, automakers can share the costs of research and development, maybe even gain better access to certain auto markets.
One great example is the Toyota and Suzuki partnership. Suzuki needed an ally with deep pockets because they wouldn’t even pay for proper fuel economy test facilities, let alone pour money into developing next-generation electrified drivetrains. Toyota will share their R&D wealth and in return, Suzuki could provide them with better access to the India auto market, an ever growing market where Suzuki is strong.
Unlike everyone else, Honda is happy to be on their own. The company is aiming to have an average global sales of around 5 million units whilst its rivals race to sell double that volume. Honda CEO Takahiro Hachigo told Automotive News that they “don't have any aspirations to make it 10 million. We are not pursuing volume just for volume's sake. By strengthening our product, that may lead to increased scale.”
Research and development costs are soaring and Honda plans to have two-thirds of its U.S. sales consist of electrified drivetrains by 2030. Hitting that target will require a lot of investment from any automaker. Only time will tell if Honda’s made the right choice in remaining independent.