|Automatic/continuously variable transmission production volumes|
|*-plan to combine
Source: Jatco TransTechnology Ltd.
Mitsubishi plans to spin off those transmission operations to Jatco in exchange for a stake in Jatco. Details are not yet final, but it is expected that Mitsubishi will receive 20 percent of Jatco. Nissan Motor Co. now owns 99.7 percent of Jatco.
Last year, Jatco built 2.2 million automatic transmissions and CVTs, while Mitsubishi built 1.05 million. Aisin AW, part of the Toyota Group, built about 3.3 million. Germany's ZF Friedrichshafen AG built 1.1 million.
The newly combined company aims for 4 million within a few years. Both Nissan and Mitsubishi expect to procure almost all of their CVTs and automatic transmissions from the expanded Jatco.
"For Mitsubishi, this will be the largest-ever spin-off," said Hiroshi Yajima, a Mitsubishi senior vice president. "This is a very important part of our Turnaround Plan," he said, referring to Mitsubishi's restructuring strategy.
Jatco currently sells about 75 percent of its output to Nissan. Even before the Mitsubishi deal, Jatco had sought to drop that to 60 percent, Jatco President Kenichi Sasaki said.
Under the spin-off, Jatco will acquire 1,400 Mitsubishi employees, its related r&d capacity, and those parts of Mitsubishi's Kyoto, Mizushima, and Yagi plants that build automatic transmissions and CVTs. The Yagi plant builds Mitsubishi's CVTs.
The combination will give Jatco "economy of scale for r&d, manufacturing, and distribution. Demand for AT components will increase especially in Europe and Asia," said Nissan President and CEO Carlos Ghosn in a statement.