Defense firm Anduril in talks to buy Nissan's Japanese plant
What's the story
US-based defense contractor Anduril Industries is in talks to acquire Nissan Motor's Oppama assembly plant, located near Tokyo, according to Reuters. The move comes as part of Anduril's plan to manufacture military drones in Japan. If the deal goes through, it could turn one of Japan's first large-scale postwar car factories into an arms-manufacturing hub.
Strategic shift
Japan's push for defense manufacturing amid Taiwan Strait tensions
The talks over the Oppama plant come as Prime Minister Sanae Takaichi's government is looking to expand defense manufacturing. This comes in light of fears that a potential crisis in the Taiwan Strait could drag Japan into conflict and deplete its weapon stocks. The move also comes as China, which sees democratically ruled Taiwan as part of its territory, has not ruled out military action to take control of it.
Public scrutiny
Potential deal could face criticism over foreign control concerns
The potential deal between Anduril and Nissan could face criticism from those wary of Japan's departure from its postwar pacifism. It could also test public support for the transition of civilian industry to defense production. There are also concerns about foreign control, as US defense equipment produced in Japan is usually manufactured under license by domestic companies.
Plant closure
Nissan's plans to close Oppama plant by 2028
Nissan has plans to close the Oppama plant in 2028 as part of its strategy to cut production capacity by one million vehicles. The company has also offered jobs to its 2,400 workers at other locations in Japan. Meanwhile, Anduril is still considering how much of the site it needs and has proposed retraining workers there for defense equipment manufacturing.
International growth
Anduril's expansion into Asia and commitment to local content
Founded in 2017 by Palmer Luckey, inventor of the Oculus Rift virtual reality headset, Anduril Industries has expanded to Taiwan and South Korea. This is part of its strategy to tap into the growing military spending by governments in the region. The company has also started working with Japan, showing its commitment to meeting domestic-content requirements. Last year, it built a prototype drone called Kizuna using only Japanese components.