Nissan is reportedly preparing to end merger discussions with Honda, according to Reuters. The negotiations stalled after Honda suggested Nissan become its subsidiary—deviating from their initial plan of forming a joint holding company. Disagreements between the two automakers widened, making further talks increasingly difficult.
Adding to the setback, Mitsubishi had already withdrawn from the proposed joint venture with Honda. If finalized, the merger would have created the world’s third-largest car manufacturer.
Market Reaction
- Honda’s stock surged 8% following the news.
- Nissan shares fell over 4% on the Tokyo Stock Exchange.
- This development follows an earlier Reuters report indicating Nissan’s potential withdrawal, with a board meeting scheduled to determine the company’s next steps.
The Honda-Nissan Merger Timeline
Discussions between Honda and Nissan began in late 2024, aiming to form a dominant global automaker. The proposed joint holding company was intended to help both brands compete against rising Chinese EV manufacturers and Tesla.
The collaboration took shape in March 2024, when the companies signed a memorandum of understanding (MoU) to explore a shared EV platform and develop a common electric powertrain. In August, a second MoU expanded the partnership to include work on advanced EVs, particularly software-defined vehicles (SDVs) with AI-driven technology and ADAS (Advanced Driver Assistance Systems).
Nissan is currently part of an alliance with Renault and Mitsubishi Motors. Renault, which holds a 36% stake in Nissan, had expressed openness to the Honda merger. However, Honda reportedly urged Nissan to repurchase its shares from Renault to prevent external influence, which could have caused delays.
Official Responses
- Nissan’s Statement: A spokesperson clarified that the original Nikkei report was “not based on information announced by Nissan” and added that the company aims to finalize its decision by mid-February.
- Honda’s Response: A Honda representative stated they had not yet received any official communication from Nissan regarding the withdrawal from their MoU.
With mounting differences and strategic concerns, the fate of the Honda-Nissan merger now hangs in the balance.
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