Honda and Nissan are in talks to merge, a move that could unite two Japanese automotive titans that have struggled lately.
The companies acknowledged the discussions in a statement, although they didn’t provide details or a timeline for when any deal — should one materialize — might be completed. It’s also unclear what form a potential joint-venture could take. Dazepost initially reported news of a possible tie-up on Tuesday.
“As per our previous announcement in March, Honda and Nissan are considering various opportunities for strategic collaboration between both manufacturers to maximize synergies together,” the companies said in a joint statement on Tuesday. “If there are any updates, we will update our stakeholders in due course.”
Honda and Nissan also told CNN that Mitsubishi is included in these early talks, potentially adding a third major Japanese car manufacturer to the mix. Mitsubishi did not return requests for comment.
In March, Honda and Nissan announced they would work together on electric vehicles, and in August they said they would collaborate on battery technology. But they’d both been challenged this year and could deepen ties.
Like many non-Chinese automakers, both companies have faltered in the once-promising China market, which is the world’s largest market for cars. Consumer behavior in China had turned on foreign brands, but now they’ve moved on to domestically made brands, which have a higher perceived value in China. China’s government has also offered incentives that encourage faster customer adoption of electric vehicles and plug-in hybrids.
While the two offer EVs and plug-ins — Nissan, in particular, paved the way for EV technology — Chinese brands like BYD have outstripped them on technology and priced their offerings more cheaply.
Nissan has also been challenged since its former chief, Carlos Ghosn, went on the lam, escaping Japan for his native Lebanon. Ghosn was arrested in 2018 in Tokyo on suspicion of financial misconduct, and Nissan terminated his employment. Ghosn has denied the charges time and again.
His removal sent rippling through the powerful automaking alliance of Nissan, Renault and Mitsubishi. When the largest automaking partnership in the world, Renault has, since, reduced its ownership stake in Nissan, weakening the Japanese automaker.
Nissan said operating profit from March to September was 90% lower than in the same period last year.
At the same time Honda, a company about five times larger than Nissan, faces headwinds, too. The company said it plans to sell only zero-emission vehicles in major markets by 2040. But the switch has been a slow process, with relatively low gas prices, inadequate charging networks and growing competition putting a damper on demand for EVs in the United States and Europe.
