Honda and Nissan Scrap Merger Plan

Japanese automakers Honda and Nissan have announced the termination of their merger talks, which began with the signing of a memorandum of understanding on December 23, 2024. These discussions aimed to establish a new holding company to merge the two automotive giants, with operations planned to commence in 2026. However, reports soon indicated that the deal faced significant obstacles, ultimately leading to its official cancellation.

Both Honda and Nissan issued a joint press release confirming the end of the merger talks, noting that the various options discussed included a proposal from Honda to turn Nissan into a subsidiary through a share exchange, rather than creating a joint holding company as initially planned. Additionally, the separate memorandum of understanding signed by Honda, Nissan, and Mitsubishi, which addressed the latter"s participation in the merger process, was also terminated.

Despite the failed merger, the three companies confirmed their continued collaboration in the development of electric vehicles while ruling out any future merger. Reports indicated that disagreements between Honda and Nissan were a major factor in the deal"s collapse, with Nissan seeking "equal treatment" between the two parties, while Honda wanted to be the dominant partner. Honda also expressed dissatisfaction with Nissan"s slow progress in restructuring its operations.

Furthermore, Honda requested that Nissan repurchase the shares owned by the French company Renault, adding another layer of complexity to the negotiations. For its part, Mitsubishi decided not to participate in the merger and to remain an independent company, further reducing the chances of the deal"s success.