Honda And Nissan To Discuss Merger To Compete With Toyota, Tesla, And Chinese EVs

Japanese automakers Honda and Nissan are reportedly set to begin merger talks, as per Nikkei Asia. The discussions could potentially expand to include Mitsubishi, creating two major groups of Japanese automakers: one led by Honda, Nissan, and Mitsubishi, and the other by Toyota, which already holds stakes in Subaru, Mazda, and Suzuki.

If finalized, the merger would allow Honda and Nissan to pool their resources to better compete with Tesla and Chinese electric vehicle manufacturers, according to Nikkei Asia. The plan includes signing a memorandum of understanding (MoU) to establish equity stakes in a new holding company, which would oversee the merged entity’s operations.

In the first half of this year, Honda, Nissan, and Mitsubishi collectively sold about four million vehicles, compared to Toyota’s 5.2 million. A merger involving Mitsubishi would result in a group with an annual output of 6.7 million vehicles, surpassing General Motors but remaining behind Hyundai.

In August, Honda, Nissan, and Mitsubishi signed a memorandum of understanding (MoU) to explore a joint framework for advancing vehicle intelligence and electrification. This builds on an earlier agreement between Honda and Nissan signed in March 2023.

Separately, Honda had planned to collaborate with General Motors on a series of affordable electric vehicles based on a new global platform, set for a 2027 launch. However, this initiative was reportedly canceled in October 2023. Meanwhile, GM has since signed an MoU with Hyundai to collaborate on key strategic initiatives.

In September, Nissan announced it had repurchased approximately 5% of its shares from Renault in a deal worth nearly 80 billion yen (around USD 552 million). Renault acknowledged the sale would lead to an estimated capital loss of 1.1 billion euros, as the stake’s current value was lower than its previous balance sheet valuation.