Honda and Nissan intend to enter merger talks, according to Japanese media outlet Nikkei. The arrangement would reportedly involve operating under a holding company and could also include a third Japanese automaker, Mitsubishi Motors. Neither Honda nor Nissan is confirming nor denying the reports, according to joint official statements released by both companies.
According to Nikkei, the automakers are considering the merger to give themselves a better position in the electric-vehicle space to compete against Tesla and low-cost Chinese EV automakers. Nissan and Honda announced earlier in 2024 the two companies were exploring collaboration opportunities, particularly regarding electric vehicle components.
Nissan is currently in financial hot water. Last month, the automaker announced its half-year net earnings were down more than 90% year over year, and cut its yearly profit forecast by roughly 70%. Nissan CEO Makoto Uchida also took a voluntary 50% pay cut. A senior official told reporters at that time the company could be headed for bankruptcy within 12 to 14 months.
Nissan’s cost-cutting measures included slashing its stake in Mitsubishi, an automaker with which it shares an alliance with French manufacturer Renault, though Nissan remains Mitsubishi’s largest stakeholder. While Nikkei reports Mitsubishi could be part of the merger talks between Nissan and Honda, neither Mitsubishi nor Renault have commented on the situation.
There are plenty of details to watch on this story, including how much stake each automaker may end up with in the holding company; and whether the Trump administration could throw a wrench in the works. Watch this space.
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