Honda And Nissan Officially Announce Merger Deal

Putting rumours to rest, Japanese car manufacturers Honda and Nissan in a press conference announced their future plans. Nissan Motor Co., Ltd. (“Nissan”) and Honda Motor Co., Ltd. (“Honda”) have signed a memorandum of understanding (MOU) to start discussions and considerations toward a merger.

Both car manufacturers have been discussing about collaborations in various fields for quite some time. The MOU between Nissan and Honda announced today is aimed to serve as an option to maintain global competitiveness and for the two companies to continue to deliver more attractive products and services to customers worldwide.

The press conference revealed that they are considering business merger and they’ll reach definitive merger agreement by June and complete it in 2026. Another Japanese car manufacturer Mitsubishi Motors that has been in an alliance with Nissan since 2016 has also signed a separate memorandum of understanding.

As far as India market is considered, both Honda and Nissan have already announced their plans till 2030 and the new announcements are unlikely to make any changes into that strategy.

However, Mitsubishi will take a final call on whether they want to continue with the talks next month. Marking the announcement, Nissan Director, President, CEO and Representative Executive Officer Makoto Uchida said:

Today marks a pivotal moment as we begin discussions on business integration that has the potential to shape our future. If realized, I believe that by uniting the strengths of both companies, we can deliver unparalleled value to customers worldwide who appreciate our respective brands. Together, we can create a unique way for them to enjoy cars that neither company could achieve alone.

Honda Director and Representative Executive Officer Toshihiro Mibe said:

Creation of new mobility value by bringing together the resources including knowledge, talents, and technologies that Honda and Nissan have been developing over the long years is essential to overcome challenging environmental shifts that the auto industry is facing. Honda and Nissan are two companies with distinctive strengths. We are still at the stage of starting our review, and we have not decided on a business integration yet, but in order to find a direction for the possibility of business integration by the end of January 2025, we strive to be the one and only leading company that creates new mobility value through chemical reaction that can only be driven through synthesis of the two teams.

As per the information that is available at the moment, both companies will be brought under a holding company that would be listed on the Japanese exchange in 2026. The group would be led by Honda, which is about four times bigger than Nissan in market capitalisation.

As per reports, Honda and Nissan had discussed their outline plans to representatives of Japan’s Ministry of Economy, Trade and Industry (METI). The ministry had raised the idea of merger back in 2019.

The mission of the government is to protect the industrial base of Japan and the government only supported a deal that appeared to do it. If this merger happens, it would be the largest merger in Japanese automotive history and would create third-largest carmaker by sales in the world.