Report: Nissan And Honda Initiate Merger Talks – Was Ghosn Right?

Are long-time rivals Nissan and Honda in talks for a possible merger? Reports online are indicating so.

Rivalling Japanese automakers Nissan and Honda officially confirmed earlier this week that both firms have begun initial talks and discussions, which could possibly lead to a merger. Through which, both firms are expected to increase their existing cooperation and share more resources towards fending off increased global competition.

Initial reports indicate that these “early exploratory discussions” were aimed at establishing an umbrella holding company that financially embattled Nissan and Honda would both fall under. Though it wasn’t made clear initially, the establishment of said joint holding company is widely viewed by many as the start a merger.

Despite so, both Nissan and Honda issued identical statement on Tuesday saying no merger had been announced by either party. “As announced in March of this year, Honda and Nissan are exploring various possibilities for future collaboration, leveraging each other's strengths," the companies said in separate statements.

(L-R) Makoto Uchida, president and CEO of Nissan Motor, and Toshihiro Mibe, Honda Motor president and CEO, announcing the initial cooperation between both firms earlier this year.

Presently, both firms are already cooperating with each other on the electric vehicle (EV) development front, which also involves Mitsubishi – a brand in which Nissan owns a 24.05% stake in. 

Nevertheless, should this supposed merger occur, much to the dismay of ousted and exiled former Nissan CEO and president Carlos Ghosn, the ensuing new joint holding company could stand to be come the world’s third largest auto group by vehicle sales after Toyota (1st) and Volkswagen (2nd).

Last year, Honda shifted 3.98 million vehicles whilst Nissan sold 3.37 million vehicles, albeit on a preliminary basis. Both brands’ combined 2023 global sales totalled over 7.35 million vehicles, which sees it edge over rivals Hyundai and its affiliate Kia – currently the world’s third largest auto group – and their combined 2023 sales figure 7.31 million vehicles.

In terms of manpower, Honda has 194,993 employees as a consolidated group, whereas Nissan presently employs 133,580 staff members based on its end of March 2024 securities filing.

Electrification targets will clearly be at the centre of any ensuing merger formed by both companies coming together.

Clearly, electrification targets will be at the centre of any ensuing merger formed by the two rivalling companies.

Presently, Honda aims to boost its hybrid sales up to 1.3 million units by 2030, and its EV output to over 2 million units annually by 2030. It aims to do the latter by converting 40% of its new cars sales to EVs and fuel cell (FCEVs), becoming a full EV and FCEV-only brand by 2040 too.

Nissan, on the other hand, aims for its EVs and hybrids to form at least 60% of its 2030 global sales.