On November 30, I wrote about Nissan’s money problems and the fact that Honda could enter merger talks to save Nissan from bankruptcy. Well, discussions have just begun according to a local primary news source.
Yesterday in Tokyo, the Nikkei newspaper reported that Honda and Nissan are understood to have started exploratory talks about a potential merger to save the ailing Nissan, be expanded to include Mitsubishi Motors, and help the three firms compete against electric vehicle (EV) makers, mainly those from China. While Honda and Nissan declined to confirm Tuesday’s report, both automakers, as well as Mitsubishi, issued statements that focused on their previous agreements for further future collaboration.
In March 2024, the two automakers agreed to jointly develop a strategic partnership for electric vehicles and then in August cemented their ties by agreeing to jointly develop batteries and other similar technologies.
The Nikkei article said Japan’s two major automakers — No. 2 and No. 3 respectively (behind Toyota, of course) — were signing a memorandum of understanding to discuss shared stakes in a new holding company under which the merged company would operate.
Without denying the Nikkei story, the two automakers responded to Forbes stating that “as announced in March of this year, Honda and Nissan are exploring possibilities for long-term collaboration, leveraging each other’s strengths. “
News of a potential merger comes as many automakers face a sprawling festival as powertrains transition from gasoline and diesel to electric, with production booming in China.
BRUSSELS, BELGIUM – JANUARY 13: Nissan Ariya crossover SUV on demonstration at the Brussels onArray Expo. [+] January 13, 2023 in Brussels, Belgium. (Photo via Sjoerd van der Wal/Getty Images)
A Honda-Nissan deal, with the possibility of including Mitsubishi in the mix, would shape a true Toyota rival that would create one of the world’s three largest automotive alliances and split the Japanese industry into two camps. Reacting to the positive news, Nissan shares rose 23% in Tokyo on Wednesday, while Mitsubishi’s rose 20% and Honda’s fell about 3%.
Honda and Nissan are expected to officially confirm that they have begun exploratory negotiations next week, according to TBS, a major Japanese television network.
Although both companies offer hybrids, EVs and plug-ins – Nissan was the pioneer in EV technology when it debuted the Leaf in 2011. As of 2024 however, Chinese brands like BYD, Geely, SAIC and Chery have surpassed Japanese EV technology and are priced significantly cheaper.
The two car brands had combined global sales of 7. 4 million units in 2023, but faced the festival of Chinese brands such as BYD, which posted considerably higher quarterly revenue, surpassing Tesla for the first time. weather in October.
But let’s take a look at the elephant in the room. Even if Honda and Nissan merge, will their combined technologies and product lines be competitive enough to compete with China and, indeed, Tesla and others?Although Nissan currently has three electric vehicles for sale (the Ariya SUV, the Leaf, and the Sakura minicar), its popular hybrid generation e-Power (in Japan) has been slow to become popular internationally. , with a single prologue. EV: has struggled to keep up with other major brands.
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