2008 Nissan 350z Nismo Coupe 2-door 3.5l on 2040-cars

Auto blog

Why Japan's government is looking to curb its adorable kei car market

Each region around the world has its stereotypical vehicle. The US has the pickup and Europe the five-door hatchback; but in Japan, the kei car reigns supreme. These tiny cars are limited to just 660cc of displacement but they've also come with lower taxes to make them more affordable. To make of the most of their small size, they've often had quite boxy styling like the Honda N-One shown above, and because they're Japanese, they've often had quirky names like the Nissan Dayz Roox. However, if the Japanese government has its way, the future popularity of these little guys might be in jeopardy. The problem facing them is that Japan is an island both literally and figuratively. After World War II, the Japanese government created the class as a way to make car ownership more accessible. The tiny engines generally meant better fuel economy to deal with the nation's expensive gas, and the tax benefits also helped. It's made the segment hugely popular even today, with kei cars making up roughly 40 percent of the nation's new cars sales last year, according to The New York Times. The downside is that these models are almost never exported because they aren't as attractive to buyers elsewhere (if indeed they even meet overseas regulations). So if an automaker ends up with a popular kei model, it can't really market it elsewhere. The government now sees that as a threat to the domestic auto industry. It believes that every yen invested into kei development is wasted, and the production takes up needed capacity at auto factories. The state would much rather automakers create exportable models. To do this, it's trying to make the little cars less attractive to buy, and thus, less attractive to build. The authorities recently increased taxes on kei cars by 50 percent to narrow the difference between standard cars, according to the NYT. If kei cars do lose popularity, it could open the market up to greater competition from foreign automakers. Several companies complained about the little cars stranglehold on the Japanese market last year, but since then, imported car sales there have shown some growth thanks to the improving economy. Featured Gallery 2013 Honda N-One View 20 Photos News Source: The New York TimesImage Credit: Honda Government/Legal Honda Nissan JDM kei kei car

France could reduce its Renault stake to solidify partnership with Nissan

French Finance Minister Bruno Le Maire said France is ready to cut its stake in Renault in order to consolidate Renault's partnership with Nissan, Agence France Press (AFP) reports. Le Maire said Paris, which has a 15% stake in Renault, might consider reducing its stake, if it led to a "more solid" alliance between the Japanese and French firms, the French news agency reported, citing an interview with the minister. "We can reduce the state's stake in Renault's capital. This is not a problem as long as, at the end of the process, we have a more solid auto sector and a more solid alliance between the two great car manufacturers Nissan and Renault," he told AFP. Le Maire had earlier said the French government was open to tie-ups involving Renault as long as French industrial interests were protected, and would consider any Renault deal with Fiat Chrysler that respected the French firm's alliance with its Japanese partner Nissan. Fiat on Thursday abandoned its $35 billion merger offer for Renault, blaming French politics for scuttling what would have been a landmark deal to create the world's third-biggest automaker behind Japan's Toyota and Germany's Volkswagen. The French government had welcomed the merger plan, but overplayed its hand by pushing for a series of guarantees and concessions that eventually exhausted the patience of FCA, sources told Reuters. Renault and Nissan were not immediately available to respond to a request seeking comment. (Reporting by Mekhla Raina in Bengaluru; editing by Richard Pullin and Elaine Hardcastle)

Renault delays decision on merger with Fiat Chrysler

PARIS — Renault has delayed a decision on whether to merge with Fiat Chrysler Automobiles, a deal that could reshape the global auto industry as carmakers race to make electric and autonomous vehicles for the masses. The deal still looks likely, but faced new criticism Tuesday from Renault's leading union and questions from its Japanese alliance partner Nissan. The French government is also putting conditions on the deal, including job guarantees and an operational headquarters based in France. The French carmaker's board will meet again at the end of the day Wednesday to "continue to study with interest" last week's merger proposal from FCA, Renault said in a statement. A Renault board meeting Tuesday to study the deal was inconclusive. The company didn't explain why, but a French government official said board members don't want to rush into a deal and are seeking agreement on all parts of the potential merger. The official, who spoke on condition of anonymity in line with government policy, told The Associated Press the conditions outlined by France's finance minister still "need to be met." France and Italy are both painting themselves as winners in the deal, which could save both companies 5 billion euros ($5.6 billion) a year. But workers worry a merger could lead to job losses, and analysts warn it could bog down in the challenges of managing such a hulking company across multiple countries. And a possible loser is Japan's Nissan, whose once-mighty alliance with Renault and Mitsubishi is on the rocks since star CEO Carlos Ghosn's arrest in November. Nissan CEO Hiroto Saikawa cast doubt Tuesday on whether his company will be involved in a Renault-Fiat Chrysler merger — and suggested adding Fiat Chrysler to the looser Renault-Nissan-Mitsubishi alliance instead. Saikawa said in a statement that the Renault-Fiat Chrysler deal would "significantly alter" the structure of Nissan's longtime partnership with Renault, and Nissan would analyze its contractual relationships to protect the company's interests. If Renault's board says "yes" to Fiat Chrysler, that would open the way for a non-binding memorandum of understanding to start exclusive merger negotiations. The ensuing process — including consultations with unions, the French government, antitrust authorities and other regulators — would take about a year. A merger would create the world's third-biggest automaker, worth almost $40 billion and producing some 8.7 million vehicles a year.