Japanese Automakers Nissan and Honda Consider Merger to Stay Competitive
Nissan Motor and Honda Motor, two Japanese automakers, are reportedly planning to enter into merger talks to increase their competitiveness in a rapidly changing global automotive industry. The two giants are considering operating under a holding company structure and eventually integrating Mitsubishi Motors, in which Nissan holds a 24% stake.
The combined Nissan-Honda-Mitsubishi entity would sell over 8 million vehicles per year, placing it among the world's largest automakers, although still below its Japanese counterpart Toyota Motor and German manufacturer Volkswagen.
This potential merger follows the strategic partnership formed by the two Japanese automakers earlier this year, which focuses on sharing automotive components and software. The move comes as Nissan faces significant challenges, having announced the elimination of 9,000 jobs worldwide in November and a reduction in production capacity to adapt to declining sales. The company is struggling in its key markets, the United States and China.
If successful, this would be the largest merger in the automotive industry since Fiat Chrysler merged with French group PSA to form Stellantis in January 2021. Automotive experts often call for increased mergers and acquisitions in the industry to share costs and better compete with expanding Chinese automakers and American electric vehicle leader Tesla.
