Recent reports suggest Honda and Nissan could be advancing merger talks, after earlier efforts toward a tie-up earlier this year.
Back in March, Nissan and Honda announced it would conduct a “feasibility study” to develop a strategic partnership, sharing resources toward electrified vehicle development and mobility concepts for a new generation. Fast-forward several months with Nissan facing financial woes, and new reports suggest the two automakers could develop a much stronger tie-up, possibly including negotiations for the two major Japanese automakers to merge.
A report from Japan’s Nikkei media outlet (also picked up by Reuters) cites a person with knowledge of the ongoing talks. While neither company has formally announced a merger deal yet, the two are reportedly angling to set up a new holding company — an umbrella that would encompass the current entities of Nissan Motor Corporation and Honda Motor Company, Ltd. and enable the two to pool their financial resources and technical knowledge to better compete on technology against global heavyweights in the EV space, including Chinese automakers, Tesla and other rivals.
Right now, the official word from both companies is that, “Honda and Nissan are exploring various possibilities for future collaboration, leveraging each other’s strengths.” Eventually, if there is any movement, we will hear more details as Honda and Nissan inform their respective shareholders of a merger deal, and the resulting entity may face regulatory hurdles as it aims to create a larger, stronger player in the automotive industry, as Stellantis faced when it merged from Fiat Chrysler Automobiles (FCA) and Groupe PSA (Peugeot).
Nikkei further reports the two companies will soon sign a memorandum of understanding as the first major milestone toward a merger deal. With Honda’s current market capitalization of 5.95 trillion yen ($38.8 billion) and Nissan’s 1.17 trillion yen ($7.6 billion), the purported merger would represent one of the largest in the industry since Stellantis formed in 2021. However, it is worth noting the new entity still pales in comparison to Toyota’s 42.52 trillion yen ($276.5 billion) valuation (per Financial Times data).
This news comes as the entire global automotive industry is slow-rolling its EV development, in part thanks to slowing demand in North America and Europe and a tumultuous political landscape. Chinese rivals are ratcheting up the pressure in both markets, while homegrown automakers like Volkswagen face struggles with labor unions, and indeed Nissan faces an existential financial crisis wherein unnamed executives said the company has “12 to 14 months to survive” in late November.
Other unconfirmed reports suggest Mitsubishi — which bought some of its own shares back from Nissan last month (and providing Nissan some financial breathing room) — is also involved in the potential merger deal. It’s even more unclear at time of writing how that automaker’s inclusion in a deal would shake out.
Until we get some confirmation of the deal and its details, you can use your imagination to determine what actual vehicles would come out of a close tie-up between Nissan and Honda. Will we see new supercars like a next-gen NSX or GT-R? Will Honda parlay its development of the new Passport into a spiritual Nissan Xterra successor. What new electrified vehicles could we see, since Honda has a wide range of hybrid vehicles to Nissan’s decidedly barren hybrid lineup? We’ll have to wait and see.
