Japanese auto giants Honda Motor and Nissan Motor will enter merger talks and integrate their resources to better connect with the world, Nikkei reported on Wednesday (18th), citing people familiar with the matter. Competition from larger EV manufacturers.
The report pointed out that the two companies are considering operating under the framework of a holding company and are expected to sign a memorandum of cooperation (MOU) soon, and will decide on their respective shareholding ratios in the new entity later. In addition, the two parties also plan to incorporate Mitsubishi Motors into the new entity. Nissan is the largest shareholder of Mitsubishi Motors, holding a 24% stake.
Honda and Nissan did not respond to requests for comment by deadline.
Some analysts believe that the two companies have strengthened their relationship with each other in recent months, and this move is in response to fierce competition from Chinese electric vehicle manufacturers. These traditional brands that are difficult to obtain sufficient profits from the electric vehicle business are under great pressure.
Nissan and Honda, Japan's third- and second-largest automakers after Toyota, have been losing market share in China. China's electric vehicle sales accounted for nearly 70% of global electric vehicle sales in November, with sales exceeding 1.27 million units that month.
The two companies will have combined global vehicle sales of 7.4 million vehicles in 2023, but they are grappling with challenges from electric vehicle makers, especially in China, where BYD (01211-HK) and others are far ahead.
