Honda and Nissan Plan to Merge Operations
Photo courtesy Nissan Motor Co.
TOKYO—Honda Motor Co. and Nissan Motor Co. are planning to join forces to compete in the fast-changing automotive landscape. The historic merger, which may also include Mitsubishi Motors Corp., would create the world’s third largest auto group after Toyota Motor Corp. and Volkswagen AG. Honda and Nissan currently rank as the No. 2 and No. 3 Japanese automakers (Toyota is No. 1).
According to the Reuters news agency, the two companies “are in talks to merge by 2026,” which represents “a historic pivot for Japan's auto industry that underlines the threat Chinese EV makers now pose to the world's long-dominant legacy car makers….It would also give the two companies scale and a chance to share resources in the face of intense competition from Tesla and more nimble Chinese rivals, such as BYD.”
Reuters claims that it “would be the biggest reshaping in the global auto industry since Fiat Chrysler Automobiles and PSA merged in 2021 to create Stellantis in a $52 billion deal.”
“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,” says Toshihiro Mibe, executive director of Honda. “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.”
Expected synergies from the business integration include “scale advantages by standardizing vehicle platforms….enhancement of development capabilities and cost synergies through the integration of R&D functions….optimizing manufacturing systems and facilities….[and] strengthening competitive advantages across the supply chain through the integration of purchasing functions….”
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