Nissan Board Decide to Call Off Merger Talks with Honda; Plans to Keep Collaborating in Key Areas (UPDATE 1)

The Yomiuri Shimbun

12:48 JST, February 6, 2025 (updated at 15:15 JST)

Nissan Motor Co. decided to call off merger talks with Honda Motor Co. at a board of directors meeting held on Wednesday, judging it impossible to reach an agreement with Honda due to strong opposition to the proposal sounded out by Honda to make Nissan its subsidiary, according to sources.

Nissan President Makoto Uchida informed Honda President Toshihiro Mibe at a meeting on Thursday of his company’s intention to call off merger talks, making it highly likely that the historic talks between the two major Japanese car manufacturers will break down.

According to sources, Uchida met with Mibe for about an hour at Honda’s head office in Tokyo.

Even if the merger talks are called off, Nissan remains keen on continuing to work with Honda in areas such as electric vehicles and software defined vehicles, the functionality of which can be improved through software updates. Uchida is believed to have conveyed this intention to Mibe as well, the sources said.

Nissan is expected to make a formal decision on the matter on Thursday.

Following the outcome of Nissan’s Wednesday meeting, Honda is planning to hold its own board of directors’ meeting later this month to clarify the status of the merger talks. According to the sources, the company recently informed its business partners that it will have no choice but to call off the talks if Nissan rejects the proposal to make it Honda’s subsidiary.

Honda and Nissan announced in December that they would establish a new holding company in August 2026 and discuss a merger, in which the two companies would be placed under this holding company.

Honda had made the restructuring of Nissan, which is currently in the process of rebuilding its business, a precondition for the integration.

Regarding the subsidiary proposal, Nissan had been holding discussions on the matter since late last week. However, there was strong opposition to this proposal within the company, and directors agreed at Wednesday’s board meeting to call off the merger talks and aim to rebuild the company on its own.

With the merger talks now set to be called off, the focus of attention is now on whether Nissan can complete its own restructuring. However, many market observers view Nissan’s restructuring plan as insufficient.

Honda and Nissan on Wednesday issued comments regarding the merger talks. They said that they would decide on a direction and announce it by the middle of the month.