Nissan, Honda announce plans to consider merger

Japanese car manufacturers Nissan and Honda agreed to consider a merger and create a joint holding company that would create the world’s third-largest automaker.

The two companies said in a statement Monday that they would seek combined sales of $191 billion and operating profit of more than $19 billion through the potential merger.

The companies hope to conclude negotiations around June 2025 and create a holding company by August 2026, when shares in both companies will be delisted.

The merger talks come as both automakers struggle to compete with the world’s biggest electric car makers, including Tesla and Chinese automaker BYD.

WHAT COULD THE HONDA-NISSAN MERGER MEAN FOR THE AUTO INDUSTRY AND CONSUMERS?

Makoto Uchida (left), director, representative, CEO, president and CEO of Nissan Motor Corporation and Toshihiro Mibe (right), director, president and CEO representative of Honda, held a joint press conference on their merger. (Reuters / Reuters Photos)

The merger will create the world’s third largest auto group car sales Behind Toyota and Volkswagen.

Honda, the second-largest Japanese automaker after Toyota, has a market cap of more than $40 billion, while third-place Nissan is valued at about $10 billion.

“Today is an important moment as we begin discussions about business integration that has the potential to shape our future,” Nissan chairman, CEO and CEO Makoto Uchida said in a statement , that by combining the strengths of both companies, we can deliver unprecedented value to customers around the world who value our brands. Together, we can create a unique way for them to enjoy cars that neither company can achieve alone.”

The Honda-Nissan merger would create the world’s third largest auto group by car sales. (Reuters / Reuters Photos)

Honda director and executive representative Toshihiro Mibe said. “Creating new mobility value by pooling resources, including the knowledge, talent and technology that Honda and Nissan have been developing for many years, is essential to cope with challenging environmental changes. the auto industry is standing.

“Honda and Nissan are two companies with particular strengths,” Miebe added. we strive to be the one and only leading company that creates new mobility value through a chemical reaction that can only occur through the synthesis of two teams.”

HONDA, NISSAN ALLEGEDLY PLAN TO START MERGER TALKS IN LIGHT OF EV COMPETITION.

Honda and Nissan also agreed to expand cooperation with Mitsubishi Motors. (Reuters / Reuters Photos)

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The majority of the holding board will be designated by Honda.

The companies have looked for ways to strengthen their partnership, including saying in March that they were discussing cooperation in electrification and vehicle intelligence, and in August announcing an agreement to conduct joint research on fundamental technologies for next-generation vehicle-defined vehicles.

They also agreed to expand cooperation with Mitsubishi Motors.

Reuters contributed to this report.