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Japan could consolidate to three automakers by 2020

Sergio Marchionne might see his dream of big mergers in the auto industry become a reality, and an analyst thinks Japan is a likely place for consolidation to happen. Takaki Nakanishi from Jefferies Group LLC tells Bloomberg the country's car market could combine to just three or fewer major players by 2020, from seven today. "To have one or two carmakers in a country is not only natural, but also helpful to their competitiveness," Nakanishi told Bloomberg. "Japan has just too many and the resources have been too spread out. It's a natural trend to consolidate and reduce some of the wasted resources." Nakanishi's argument echoes Marchionne's reasons to push for a merger between FCA and General Motors. Automakers spend billions on research and development, but their competitors also invest money to create the same solutions. Consolidating could conceivably put that R&D money into new avenues. "In today's global marketplace, it is increasingly difficult for automakers to compete in lower volume segments like sports cars, hydrogen fuel cells, or electrified vehicles on their own," Ed Kim, vice president of Industry Analysis at AutoPacific, told Autoblog. Even without mergers, these are the areas where Japanese automakers already have partners for development. Kim cited examples like Toyota and Subaru's work on the BRZ and FR-S and its collaboration with BMW on a forthcoming sports car. Honda and GM have also reportedly deepened their cooperation on green car tech. After Toyota's recent buyout of previous partner Daihatsu, Nakanishi agrees with rumors that the automotive giant could next pursue Suzuki. He sees them like a courting couple. "For Suzuki, it's like they're just starting to exchange diaries and have yet to hold hands. When Toyota's starts to hold 5 percent of Suzuki's shares, this will be like finally touching fingertips," Nakanishi told Bloomberg. "I absolutely do believe that we are not finished seeing consolidation in Japan," Kim told Autoblog. Rising development costs to meet tougher emissions regulations make it hard for minor players in the market to remain competitive. "The smaller automakers like Suzuki, Mazda, and Mitsubishi are challenged to make it on their own in the global marketplace. Consolidation for them may be inevitable." Related Video:

Autoblog Podcast #396

Episode #396 of the Autoblog Podcast is here, and this week, Dan Roth, Steven Ewing, and Chris Paukert talk about the 2016 Mazda MX-5 Miata, the 2016 Jaguar XE, and the 2015 Lexus RC. We start with what's in the garage and finish up with some of your questions, and for those of you who hung with us live on our UStream channel, thanks for taking the time. Check out the rundown below with times for topics, and you can follow along down below with our Q&A. Thanks for listening!
Autoblog Podcast #396:
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2014 Mazda CX-5 with 2.5-liter Skyactiv engine

Back in October, we compared the relative merits of two new and very good small crossovers: the 2013 Ford Escape and 2013 Mazda CX-5. The CX-5 we tested then had Mazda's 2.0-liter Skyactiv-G engine under its hood, and it managed to just edge out the EcoBoosted Ford despite being down by some 23 horsepower and 34 pound-feet of torque. Had it been available, the 2.5-liter Skyactiv engine that we recently had the opportunity to try out in the 2014 Mazda CX-5, it may have made that comparison even easier to call in the Japanese CUV's favor.
Clearly, if you're in the market for a reasonably sized crossover, the CX-5 should, at the very least, be on your test-drive list. The new engine offering will let buyers opt for a stronger powerplant, with 184 hp and 185 lb-ft on tap. On our second day in Austin's Hill Country - the first was spent quick-spinning the 2014 Mazda6 i Sport, you'll recall - we covered a couple of hundred miles and put the new CX-5 through its paces; here's what we turned up.
Driving Notes