Reports from Japan reveal that Nissan and Honda, the country’s second and third-largest carmakers, are discussing a potential merger as they navigate the increasingly tough global market.
The two companies started collaborating on EV projects back in March to tackle challenges like the explosive growth of China’s car market and slower-than-expected demand for electric vehicles elsewhere.
An official announcement about the merger is expected next week, but it’s not without controversy. Japan’s government might push back, fearing major job losses if the companies streamline operations. Plus, Nissan’s alliance with Renault would need to be restructured if the merger goes ahead.
So far, the Nissan-Honda partnership has focused on sharing battery and EV technology. Over the summer, Mitsubishi Motors joined the mix, agreeing to collaborate on EV “intelligence and electrification.”
Adding to the drama, there are rumours (unconfirmed so far) that Foxconn, the iPhone manufacturer, has approached Nissan about buying a majority stake in the company.
Both automakers have remained tight-lipped, issuing near-identical statements: “if there are any updates, we will inform our shareholders at the appropriate time”.
Market reactions have been mixed. Nissan’s stock has climbed, and Mitsubishi’s jumped 20%, while Honda’s shares have dipped slightly.
Last year, Honda and Nissan sold a combined 7.4 million vehicles, but they’re losing ground in China—the world’s largest EV market. If a merger is on the horizon, it could mark a major shift in the automotive industry.
