Honda, Nissan in Talks to Merge (UPDATE 1)

Jiji Press

10:21 JST, December 18, 2024 (updated at 10:45 JST)

Tokyo (Jiji Press)—Honda Motor Co. and Nissan Motor Co. are considering setting up a holding company to merge their operations, people familiar with their talks said Wednesday.

Mitsubishi Motors Corp., in which Nissan invests, may join the merger in the future, the people said.

The merger is apparently designed to make it easier to raise a large amount of funds necessary to develop electric vehicles, an area in which the three Japanese automakers struggle to catch up with foreign rivals.

The three-way merger, if realized, will create the third largest auto group in the world with annual vehicle sales of over eight million units.

“Although nothing has been decided yet, it’s true that we are considering several options,” Honda Executive Vice President Shinji Aoyama told reporters in Tokyo.

In March, Honda and Nissan signed a memorandum of understanding for comprehensive collaboration in areas including electrification and software, a framework joined by Mitsubishi in August.

Hurt by stagnant sales in North America and China, Nissan suffered a 90 pct year-on-year plunge in its consolidated operating profit for the six months that ended September.

The poor results have forced the company to decide to shed 9,000 jobs globally and reshuffle its management team.