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Honda and Nissan Begin Merger Talks to Create World's Third-Largest Automaker with Mitsubishi

Dec 17, 2024, 08:53 PM

Honda Motor and Nissan Motor are reportedly preparing to start negotiations on a possible merger, according to reports from Nikkei and other Japanese media outlets. The merger aims to combine their resources to better compete against larger global electric vehicle makers such as Tesla and Chinese EV manufacturers amid increasing competition in the EV market. The potential deal could eventually be expanded to include Mitsubishi Motors, with a combined entity forming one of the world's largest auto groups. If the three companies merge, their combined sales would exceed 8 million vehicles, potentially making them the world's third-largest automaker. The companies are considering establishing a holding company to merge their operations, consolidating their efforts in electric vehicle development and reducing costs through resource pooling. The reports have led to significant market reactions, with Nissan's shares surging up to 24% following the news. Both Honda and Nissan have faced declining sales and production cuts, prompting them to seek strategies to enhance competitiveness. However, both Nissan and Honda have stated that the content of the reports is not something that has been officially announced by either company. Honda's president did not deny the possibility of a merger, stating, 'I think there is a possibility.'