Mitsubishi Relinquishes Stake in Hyundai But Increases Cooperation
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| Will Mitsubishi and Hyundai work together to build a large luxury car that both companies could use to increase profitability? Hyundai has admitted plans to expand its lineup to include a pickup, full-size SUV and top-tier luxury car like the Equus HCD-7 concept that appeared on the North American auto show circuit in 2002. (Photo: Hyundai Motor) |
Ties grew stronger on Wednesday, March 19, when Mitsubishi Motors Corp., Hyundai Motor Co., and Hyundai Mobis announced an agreement to work more closely together on the development, manufacture and sale of upcoming vehicles and components.
What does this mean? While no particular project is yet planned the three companies will start reviewing individual strengths and weaknesses in order to build the best vehicles possible at the lowest costs, taking advantage of economies of scale in the process.
It's important to realize that cooperation between Hyundai and Mitsubishi isn't exactly a new idea. The two companies have worked together for more than twenty years, when Mitsubishi took an equity stake in Hyundai. Both are also tied to one another via DaimlerChrysler, the global auto giant that owns significant shares in each brand.
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| While Hyundai has a lot to offer Mitsubishi the same in reverse is equally true. Something like the Lancer EVO8 powered lean and light Tarmac Spyder would be good to enhance both automaker's images. (Photo: Mitsubishi Motors) |
A new twist in the relationship has Mitsubishi divesting its total 1.71% stake in Hyundai Motor to Hyundai Mobis, the Korean automaker's top stakeholder, due to close in the early part of next week.
Hyundai Mobis, originally Hyundai Precision Engineering (one of the company's vehicle assemblers), will directly control a 13.2% chunk of Hyundai Motor once the Mitsubishi shares are counted in.
Currently a component supplier to Hyundai Motor, Mobis will benefit from relations with Mitsubishi by reaching a much larger consumer base for both company's next generation of cooperatively built cars.