Honda, Nissan to detail merger plans mid-February: Officials

Honda and Nissan are expected to reveal details of their proposed merger in mid-February.

Honda and Nissan, Japan’s second and third-largest automakers by volume, confirmed on Friday that they plan to merge under a holding company by 2026. While they had initially aimed to release more details by the end of January, the companies did not provide a specific reason for the delay.

Sources familiar with the discussions have indicated that Honda has been a driving force behind the merger, pushing Nissan to accelerate its ongoing restructuring process as a condition of the partnership.

This suggests that Honda’s interest in the merger may be contingent on Nissan demonstrating significant progress in streamlining its operations and improving its financial performance.

Facing a drastic 90% drop in net profit for the first half of the fiscal year (April-September, 2024), Nissan announced a major restructuring in November 2024, including plans to cut 9,000 jobs globally and reduce production capacity by 20%.

This move, representing approximately 7% of its workforce, aims to streamline operations and address miscalculations in hybrid electric vehicle demand in key markets like the US, as part of a larger effort to create a more resilient business model.

While Mitsubishi Motors, a long-time partner of Nissan, was initially considering joining the proposed merger with Honda, sources now indicate they are likely to remain independent.

This decision reportedly stems from concerns about Mitsubishi’s influence within the larger merged entity, with the company prioritizing its own growth strategy, particularly in Southeast Asia.