Honda and Nissan – two major Japanese automakers – have confirmed they are in talks to merge and list the holding company on the Tokyo Stock Exchange by August 2026.
On Monday, the two companies revealed they had signed a memorandum of understanding (MoU) and will be joined by Mitsubishi Motors, the smaller alliance member of Nissan.
Honda and Nissan will pursue unifying their operations under a joint holding company, said Honda president Toshihiro Mibe. The merger will create the world’s third-largest auto company by sales after Toyota and Volkswagen.
Honda produces 4 million units each year, while Nissan sells 3.4 million cars. With Mitsubishi pitching in with just over 1 million, the combined sales will be close to 8.5 million units. By comparison, Toyota produced 11.5 million cars in 2023 and Volkswagen around 9 million.
The two Japanese firms have lagged behind in the race for electric vehicles and the merger would give them the scale and a chance to share resources against competition from Tesla and Chinese EV makers.
Honda will initially lead the new management, retaining the principles and brands of each company.
At a joint press meeting on Monday, Mibe said: “The rise of Chinese automakers and new players has changed the car industry quite a lot. We have to build up capabilities to fight with them by 2030, otherwise we will be beaten.
“Current business models are being upended. It is not going to take 10 to 20 years for that to happen, it will come much faster. We need to have the right artillery in order to be competitive on that battlefield so we’re starting today.”
Nissan has struggled financially in recent times. Profits for six months ending in September was down 94 per cent compared with the same period in 2023, and the company announced it was cutting its manufacturing output by 20 per cent and laying off 9,000 workers.
In Monday’s conference, Nissan CEO Makoto Uchida said: “Today marks a pivotal moment. Together, we can create a unique way for (customers) to enjoy cars that neither company could achieve alone.”
Shares of Honda Motors rose 3.82 per cent on the news to JPY1,276.5, while Nissan improved to JPY450, up 1.58 per cent.
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