Official announcement from Mitsubishi Motors, major financial news outlets

Honda and Nissan Start Merger Talks Aiming for Third-Largest Auto Group by August 2026

Dec 24, 2024, 09:34 PM

Honda Motor Co. and Nissan Motor Co. have initiated formal discussions on a potential merger, aiming to establish a new holding company by August 2026. The move is driven by the need to enhance their competitiveness in the global electric vehicle (EV) market amid fierce competition from Chinese automakers. The proposed merger would create the world's third-largest auto group by vehicle sales, trailing only Toyota Motor Corp. and Volkswagen Group. The integration is expected to generate over ¥1 trillion ($6.4 billion) in synergies through shared platforms, joint research and development, and procurement. However, the full benefits of these synergies are not anticipated until after 2030. Both companies face challenges in their EV offerings, with Nissan struggling with production issues and Honda focusing more on hybrids. The merger talks also include considerations from Mitsubishi Motors, Nissan's junior partner, which will decide by January 2025 whether to join the merger. The Japanese government has expressed support for the merger, viewing it as a step towards strengthening the competitiveness of the domestic auto industry.