AD #4299 – Ford Not Giving Up on Europe; Honda & Nissan Merger Back On?; Military Production New Revenue Source for OEMs

This is Autoline Daily, the show dedicated to enthusiasts of the global automotive industry.

HONDA & NISSAN MERGER BACK ON?
Could Honda and Nissan revisit a potential merger? Some analysts believe that could happen. The two automakers kicked off talks in late 2024 about a tie-up but the negotiations fell apart when Honda insisted that Nissan gain some financial stability before an alliance could happen. Nissan was also dead set against Honda’s demand that it become a wholly-owned subsidiary. But now, the two automakers’ fortunes have reversed. Nissan posted an annual operating profit thanks to restructuring under new CEO Ivan Espinosa. Meanwhile, Honda reported its first annual operating loss since the company was founded due to a huge EV write-off. Because of that, some analysts believe the two companies will resume partnership talks. If they merge, it would create one of the largest automakers in the world and it would allow them to combine their engineering and financial resources, which would make them more competitive globally.

MILITARY PRODUCTION NEW REVENUE SOURCE FOR EU OEMs
As we’ve been reporting for some time now, the European auto industry is under a lot of pressure. Sales are more than a million vehicles lower than they were a decade ago. Most assembly plants are operating well under capacity. And Chinese automakers are gaining market share. So Volkswagen, Continental and Schaeffler are getting into military production as a new source of revenue. And Mercedes-Benz says it’s looking into it, too. VW is forming a joint venture with Israel’s Rafael Advanced Defense Systems. Conti and Schaeffler are making components for the German defense company Rheinmetall. Mercedes hasn’t said what it might do, but we’ll probably know before the year is out.

           

STELLANTIS & RENAULT URGED TO USE MORE EU SUPPLIERS
The French government is worried that Chinese automotive suppliers are making too many inroads into its market. So it’s putting pressure on Stellantis and Renault to source more parts from European suppliers, especially those with operations in France. And the French government does have some say in the matter. It owns 10% of the voting shares in Stellantis and 15% of Renault. Stellantis has deals with Leapmotor and Dongeng to make cars at its plants in Europe, while Renault is allowing Geely to make cars at a plant in Brazil. And they’re both sourcing more components from Chinese suppliers, which is why the French government is pressuring them to source more from European suppliers.

FORD ENERGY GETS 1ST BIG CUSTOMER
Last week, Ford officially launched its battery storage business called Ford Energy. And it just scored its first big contract. It signed a five-year deal with renewable energy company EDF power solutions which will allow it to buy up to 4-GWh of battery energy storage systems a year. Deliveries are expected to begin in 2028. Ford’s stock rallied for two days after it launched Ford Energy, jumping 21%, but it dipped on Friday, with its worst daily drop since February 2025.

FORD NOT GIVING UP ON EUROPE
Last year Ford sold about 425,000 vehicles in Europe, but that’s less than half of 10 years ago when it was the #4 automaker selling around 1 million units. It’s now #8, so Ford launched a new plan to “compete and win in Europe.” That includes 7 new models for the region. Its commercial division, called Ford Pro, will get two of those 7 models; a new Super Duty version of the Ranger and the new Transit City, which it revealed in March and is based on a model from its Chinese joint-venture partner Jiangling. The Ranger Super Duty features things like a thicker frame, reinforced driveshafts and suspension, 8-stud wheel hub with larger bolts and a stronger rear axle and tow system. It could even be used for military purposes in North America and Europe. The company says uptime is essential for its commercial customers, so it’s now allowing dealers to also get real-time access to connected data from Ford vehicles in their area, so they recommend and schedule service before problems happen. The other 5 new models for Ford of Europe will be passenger vehicles. Two will be small pure EVs, including a hatchback and SUV. Europe will also get a new multi-energy version of the Bronco that goes into production in Spain in 2028. Per a previous Automotive News report, it will be smaller than the Kuga, which is Europe’s version of the Escape, but bigger than the Puma. The other new models will be multi-energy crossovers that will come out in 2029.

BYD HIRED KEI CAR VETERAN
As we’ve reported, BYD is introducing its own electric kei car into the Japanese market. Called the Racco, it features a 20-kWh battery and is expected to deliver 180-kilometers or 112 miles of range. It goes on sale this summer with a starting price around $16,000. The model was also developed specifically for Japan and is not based on an existing platform. So to help with the development, BYD hired a former Nissan kei car engineer. Kei cars, which account for about 40% of sales in Japan, face strict limits on dimensions and output, so BYD needed an expert to help it compete in such an important segment.

FISKER OWNERS HACK VEHICLE SOFTWARE
Since Fisker went bankrupt the most recent time in 2024 its Ocean SUVs started losing critical functions. Things like the brakes, airbags, shifter, battery management and door locks needed to connect to Fisker’s cloud services to undergo checks and make sure they were operating correctly. But that stopped with the bankruptcy, so owners have formed the Fisker Owners Association, now with about 4,000 members and they’ve reverse-engineered software, hacked CAN-bus networks and built open-source tools to keep their vehicles running. There’s an estimated 11,000 or so Fisker Oceans that were sold after production stopped.

SUPPLIER, AUTOMAKER RELATIONSHIPS IMPROVE
Suppliers are happier with their relationships with automakers, at least in the U.S. market. The consulting firm Plante Moran publishes its Working Relationship Index every year that measures what suppliers think of automakers across different parts of the business involving 20 different commodities. It surveys 750 executives from the top 78 suppliers. And the big surprise this year is that every automaker improved the way it works with suppliers. Even so, Toyota and Honda are the leaders of the pack. GM is in the middle, while Nissan, Ford and Stellantis trail far behind. We’ve got an interview with Dr. Angela Johnson from Plante Moran that we’ll be posting later today with a lot more insights into the survey. And for all of you watching who work in Purchasing, we highly recommend you listen to what she has to say.

But that’s a wrap for today’s show. Thanks for tuning in.