Major automakers Honda Motor Co. and Nissan Motor Co. are in talks over a potential merger that could create the world’s third-largest automaker group by volume. The move comes as global competition for electric vehicles intensifies, with overseas rivals like Tesla Inc. and Chinese EV maker BYD Co. dominating the market.
The proposed alliance would be formed through the establishment of a holding company, with Japan’s second- and third-largest automakers looking to challenge industry giants Toyota Motor Corp. and Volkswagen AG. If successful, the merger would create an alliance rivaling in size those of the two European groups, with combined sales reaching around 8 million vehicles.
Honda President Toshihiro Mibe stated that the company is considering collaboration with Nissan, although no decisions have been made. The two automakers had agreed to conduct a feasibility study on strategic partnerships for electric vehicle production and software technologies, which began in March and involved Mitsubishi Motors Corp., another partner of Nissan.
The talks follow speculation about Taiwan’s electronics giant Foxconn making a buyout offer for struggling Nissan, with some viewing the potential merger as a means by Nissan to thwart this move. Global automakers face increasing costs for EV development due to expensive batteries and software requirements, prompting Honda to collaborate with companies like Sony Group Corp. and General Motors Co.
Honda and Nissan are facing declining sales in China, where local brands with more affordable EVs are gaining market share from Japanese automakers. The two companies recently announced plans to cut jobs and reduce production capacity as a response to weaker-than-expected auto sales.
Source: https://english.kyodonews.net/news/2024/12/a03e03dbba61-update1-japan-automakers-honda-nissan-arranging-merger-talks-source.html