Mitsubishi Motors Not Joining Merger could Affect Speed of Honda-Nissan Talks

By Daisuke Narahashi / Yomiuri Shimbun Staff Writer

14:49 JST, January 24, 2025

A month has passed since Honda Motor Co. and Nissan Motor Co. announced they had started talks on a business merger. Mitsubishi Motors Corp., which had considered joining the merger, has begun mulling not participating, it has been learned. Amid expectations for cooperation with Honda, Mitsubishi Motors is thought to be concerned about its management freedom, as the future of Nissan’s management restructuring is not clear.

“We are considering management integration and cooperation separately,” said a Mitsubishi Motors executive late this month.

In August, Mitsubishi Motors announced that it would participate in a framework for cooperation with Honda and Nissan in areas such as EVs. However, when Honda and Nissan said in December that they would begin merger talks, the company reserved making a decision on whether it would join.

Mitsubishi Motors President Takao Kato was present at the December press conference, along with Honda President Toshihiro Mibe and Nissan President Makoto Uchida. “There is a need for the Nissan-Honda business merger to proceed. At this point, [whether we join them or not] is not yet determined,” Kato said.

Honda, which is leading the merger, considers Mitsubishi an important element. Mitsubishi Motors has the lowest sales among Japan’s seven major automakers, with approximately ¥2.8 trillion in the fiscal year ending March 31, 2024. However, Mitsubishi Motors has strong sales of plug-in hybrid vehicles (PHVs) and pickup trucks, which are popular overseas. Honda’s main market is the United States, while Mitsubishi Motors is focused on Southeast Asia, a clear distinction between the two.

If Mitsubishi Motors decides not to join the merger, Honda’s blueprint for the merger will undeniably grow hazy. From Mitsubishi Motors’ perspective, deepening cooperation with Honda in the United States, where Mitsubishi Motors does not have a production base, would be expected to lead to greater profits. About building a relationship with Honda, “The benefits are great, especially in North America,” Kato said on Jan. 10.

However, the merger talks are largely focused on Honda bailing out Nissan, which has fallen into financial trouble. Mitsubishi Motors and its major shareholder, Mitsubishi Corp., are seen to be focused on if Nissan’s restructuring is successful. However, as Mitsubishi Motors faces the rise of emerging American and Chinese companies, there is no time to wait to strengthen its competitiveness. The possibility is open that it will seek a merger with the two companies in the future.

Mitsubishi Motors’ consideration of not joining the two automakers could have an impact on the merger talks between Honda and Nissan. “The economies of scale will change. The negotiations will lack urgency and cost cutting will be half-hearted,” a Nissan executive said.