Automotive News: Honda eyes merger with floundering Nissan (3rd Update)

Nissan’s partner, Mitsubishi Motors, is also coming along for the ride with the Honda and Nissan merger.

“In an era of change in the automotive industry, the study between Nissan and Honda about a business integration will accelerate synergy maximization effects, bringing high value also to the collaborative businesses with Mitsubishi Motors,” Mitsubishi Motors CEO Takato Kato said.

“In order to realize synergies and to make the best use of each company’s strengths, we will also study the best form of cooperation. In order to realize synergies and to make the best use of each company’s strengths, we will also study the best form of cooperation.”

Today Honda and Nissan held a press conference and announced that their goal is to set up a joint holding company by August 2026.

They signed a Memorandum of Understanding (MOU) to start the integration of their two companies with a strong focus on electrification.

Fugitive Carlos Ghosn, who formerly ran the Nissan-Renault partnership, said he sees serious structural obstacles in a Honda and Nissan merger of sorts.

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“Honda Motor and Nissan Motor will enter negotiations toward a merger, Nikkei has learned, joining their resources to better compete against Tesla and Chinese electric vehicle makers in a rapidly changing automobile industry.

“Honda and Nissan are considering operating under a holding company, and soon will sign a memorandum of understanding. Their respective stakes in the new entity, as well as other details, will be decided later.

“They also look to eventually bring Mitsubishi Motors, in which Nissan is the top shareholder with a 24% stake, under the holding company. This would create one of the world’s largest auto groups, with combined sales among the three Japanese players topping 8 million vehicles. More at asia.nikkei.com

Despite racing in Formula E, Nissan is severely bleeding red ink and is cutting production in the US through to the end of March 2025 in a move that will impact the output of the popular Frontier and Rogue.

It’s been revealed that US output will be reduced by 17% compared with a year earlier as the brand deals with declining global sales. The cuts will impact the Canton assembly plant, which handles production of the Frontier pickup truck and other models, while also affecting the Smyrna factory in Tennessee, where the Rogue is built. These two models account for roughly 30% of the brand’s total US sales.

Nissan is cutting 9,000 jobs globally and is reducing its total output by 20% due to slow sales and reduced profit forecasts. Last week, the brand said approximately 1,000 of its US employees are expected to accept early retirement offers by the end of the year, equating to approximately 6% of its local workforce.

Just days ago, fears about Nissan’s future were heightened after two unnamed senior company officials suggested the brand has just “12 or 14 months to survive,” unless it can find a new anchor investor. Evidently, Nissan’s recent decision to sell 149,028,300 shares of Mitsubishi won’t be enough to secure its financial future.

Nissan is big in Formula E – how is that working for their car sales?  It’s not.