Japan's automotive industry is abuzz with the potential merger of Honda and Nissan, the country's second and third-largest car manufacturers, respectively. According to insiders, both companies are set to initiate business integration talks, aiming for completion by June next year. A joint board meeting and press conference are expected, with Mitsubishi Motors, Nissan's alliance partner, also participating.
The merger, if successful, would create the world's third-largest automotive group by sales, following Toyota and Volkswagen. This would mark the largest industry consolidation since Stellantis was formed in 2021. Honda and Nissan have been exploring collaboration, particularly in electrification and software development, to counter competition from Tesla and emerging Chinese automakers.
Honda (HMC, Financial) and Nissan are facing challenges, including declining sales in key markets like China and the U.S. Recently, Nissan announced job cuts and capacity reductions, while Honda reported lower-than-expected earnings.