Japanese automakers Honda and Nissan announced Tuesday their plans to work towards a merger, forming the world’s third-largest automaker by sales as the industry transitions away from fossil fuels, undergoing dramatic changes.
As of my cut-off date in October 2023, there has been no official merger between Nissan and Honda. However, the companies have collaborated on various projects over time, and there have been speculations about potential mergers or partnerships in the automotive industry due to the challenges of developing electric vehicles, competition in the global market, and the need for innovation.
Thank you for reading this post, don't forget to subscribe!Two companies said they have signed a memorandum of understanding Monday and that smaller Nissan alliance member Mitsubishi Motors had also agreed to join in integrating their businesses.
Honda’s president, Toshihiro Mibe, stated that Honda and Nissan would merge their operations into a joint holding company. Under the new management, Honda would take the lead, but with principles and brands of the respective companies. The official merger agreement is expected by June, and the merger should be completed and list the holding company on the Tokyo Stock Exchange by August 2026, he added.
The combination could create a giant valued over $50 billion, based on the market capitalization of the three automakers. Honda, Nissan and Mitsubishi would collectively enjoy a large enough scale to compete with Toyota Motor Corp. and with Germany’s Volkswagen AG. Toyota has technology partnerships with Japan’s Mazda Motor Corp. and Subaru Corp.
News of a possible merger surfaced earlier this month, with unconfirmed reports saying the talks on closer collaboration partly were driven by aspirations of Taiwan iPhone maker Foxconn to tie up with Nissan by buying shares from the Japan’s company’s other alliance partner, Renault SA of France.
Nissan CEO Makoto Uchida said there had been no direct approach to his company from Foxconn. He also acknowledged that Nissan’s situation was severe.
Conclusion:–
At this point, while an idea of a merger between Nissan and Honda is attractive considering the challenges in the automotive industry, there is no evidence or official statement from either company that indicates such a move is imminent. Rather, both companies will continue to explore strategic partnerships, joint ventures, and collaborations to stay competitive in the rapidly changing automotive landscape.
If, after October 2023, any development regarding the probable Nissan-Honda merger takes place, I would refer you to the recent updates in news from a site like Reuters, Bloomberg, or official company announcements for information.