Japanese automakers Nissan and Honda have officially begun merger discussions, aiming to create the world's third-largest car manufacturer. Both companies are striving to compete in the global electric vehicle (EV) market against rivals such as Tesla and BYD. Following reports of the proposed merger, Nissan's stock surged, and Honda's U.S. shares rose over 15% after the announcement.
Honda CEO Toshihiro Mibe emphasized that the merger aims to share intelligence and resources, achieving economies of scale while maintaining brand integrity. The companies plan to complete negotiations by June 2025, potentially forming a holding company listed on the Tokyo Stock Exchange, with Honda nominating most board members.
Nissan's strategic partner, Mitsubishi, may join the new group, deciding by January 2025. The merger discussions were prompted by Nissan's financial struggles and restructuring with Renault. Nissan plans to cut 9,000 jobs and reduce global capacity by 20% after a significant profit decline.
