Nissan and Honda unite to join global software-defined EV race, play catch up with Tesla

Nissan and Honda building a software-defined EV? The Japanese automakers revealed a new partnership Thursday as they look to keep pace with Tesla and others leading the SDV movement.

Nissan and Honda deepen EV alliance with SDVs

After confirming plans to partner up in March, Nissan and Honda are deepening their alliance. The Japanese automakers announced a new agreement to design and develop next-gen software-defined EVs.

Nissan and Honda will work together to promote EV adoption with a focus on software-defined vehicles (SDVs).

Like many rivals, the two believe that software (including autonomous driving, connectivity, and AI) will “determine the value of vehicles in the future.” Nissan and Honda view the new tech as a “source of competitiveness.”

Nissan and Honda plan to design and develop tech to power next-gen SDV platforms. Over the next year, the two plan to complete basic research.

Based on the results, they will “consider the possibility of mass production development.” Nissan and Honda will also develop battery tech and e-Axles to power new global vehicles.

In a separate press release, Mitsubishi announced it was joining the new alliance. “Mitsubishi Motors has unique technologies and expertise and has been collaborating with Nissan as a partner,” Nissan’s CEO Makoto Uchida said.

Mitsubishi’s CEO Takao Kato explained, “Collaboration with partners is essential in today’s auto industry,” with EVs and other tech rapidly developing.

Electrek’s Take

With Japanese automakers being some of the biggest laggards in the auto industry’s shift to electric, it’s no surprise they are partnering up.

The Nissan, Honda, and Mitsubishi partnership comes as Tesla and Chinese EV makers like BYD continue expanding in key global markets, including Japan, taking market share.

BYD is breaking into Japan’s seemingly impenetrable auto industry. While domestic automakers like Toyota, Nissan, and Honda dominate the market, most imports have historically been from German luxury automakers like Porsche, BMW, and Mercedes-Benz.

Although imports fell 7% in Japan through the first half of 2024, EV imports climbed 17%. BYD led the way, with imports surging 184% YOY, according to the Japan Automobile Importers Association.

And that’s just one market. BTD is quickly expanding into other key overseas markets like Thailand, Indonesia, Australia, Brazil, and Mexico, which are vital to Japanese exports.

Nissan and Honda deepening their alliance (with Mitsubishi joining in) comes as Toyota, Japan’s largest automaker, saw global sales slide 5% in June.

Toyota’s sales are down 0.9% through the first half of 2024, led by double-digit declines in China, Indonesia, and Thailand. The Japanese automaker blamed a “challenging market environment” and “intensified price competition” for the reason behind the fallout.

BYD continues slashing prices, making it hard for foreign automakers to compete. BYD expects joint venture brands’ share to fall from around 40% to 10% in China.

Japanese automakers are not the only ones looking to play catch up with Tesla and BYD. American automakers like Ford have announced similar plans.

Ford is working on a low-cost EV platform with software at its heart. Ford’s CEO Jim Farley has warned multiple times that Tesla and Chinese EV makers are the “ultimate competition.” Last month, Farley said he expects many rivals will turn to China for EV platforms.

Source: Nissan, Honda