Nissan, Honda Reportedly In Talks For Possible Merger

As Nissan faces financial struggles, two of its senior executives have suggested that the company only has 12-14 months left to fix its troubles. Reports from Nikkei say that Honda and Nissan are currently in talks for a possible merger.

The talks between the two Japanese automotive giants will allow close cooperation in terms of technology, especially at a time when brands like Tesla and a plethora of Chinese automakers like BYD are setting the tone for electric vehicles (EVs).

Nissan has faced declining sales in two of its biggest markets. At a time when there is currently a surge in hybrid vehicle sales in the United States, Nissan has nothing on the table for American consumers. At the same time, as China’s aggressive electric vehicle push has been led by brands like BYD and their market’s ongoing price war, pressure is being placed on companies that are already losing money from the development of EVs.

Honda, however, is in a much better shape, wherein its sales in the United States are at record highs, thanks to its broad range of hybrids. Unfortunately, like Nissan, Honda faces similar pressures in China’s EV shift as well.

Honda and Nissan issued statements on Tuesday, stating that no merger has officially been announced. “As announced in March of this year, Honda and Nissan are exploring various possibilities for future collaboration, leveraging each other’s strengths.”

Nevertheless, if the two automakers do successfully merge, Honda and Nissan will reportedly create an umbrella holding company under which both brands will fall. It is not yet clear, however, if the holding company aims to eventually establish a full merger between the two companies.

If the merger comes to fruition, it will be the largest automotive merger since the $52 billion merger between Fiat Chrysler Automobiles (FCA) and PSA in 2021, which we now know as Stellantis.

This isn’t the first time a relationship between Nissan and Honda has been formed. It must be recalled that in March of this year, Nissan and Honda signed a memorandum of understanding, beginning a feasibility study on a “strategic partnership in the fields of vehicle electrification and intelligence.”