Honda and Nissan have merger talks

Honda and Nissan have merger talks

Honda and Nissan have discussions about a possible merger that could bring two Japanese automotive giants together who have recently been fighting.

Details on the negotiations

The companies announced in an explanation that discussions were held, but not announced any details or a time frame for completing a possible deal. It is also unclear what form a potential partnership could take. nikkei first reported on the possible negotiations.

Explanation of Honda and Nissan

"As already announced in March, Honda and Nissan explore various opportunities for future cooperation by using the strengths of the other," said the company on Tuesday. "If there are news, we will inform our stakeholders at the right time."

integration of Mitsubishi

Honda and Nissan confirmed to CNN that Mitsubishi is part of these first talks, which gives the opportunity to involve a third important Japanese car manufacturer in the negotiations. Mitsubishi did not respond to inquiries about comment.

challenges on the market

In March, Honda and Nissan announced that they would work together on electric vehicles, and in August they agreed to cooperate in the field of battery technology. Both companies could benefit from deeper cooperation because they are facing various challenges this year.

decline in the Chinese market

Like many non-Chinese automobile manufacturers, Honda and Nissan also have to struggle in the once promising Chinese market, the largest automotive market in the world. Chinese consumers once increasingly turned to foreign brands, but now tend to prefer national brands that are perceived in the country as more valuable. The Chinese government has also created incentives to accelerate the acceptance of electric vehicles and plug-in hybrids.

competition in the electric vehicle sector

Although both companies offer electric vehicles and plug-ins-in particular Nissan was a pioneer in EV technology-Chinese brands like BYD have outdated their technology and offer them at cheaper prices.

difficulties in Nissan

Nissan also has difficulties after his former CEO, Carlos Ghosn, fled to the judiciary and escaped from Japan to Lebanon. Ghosn was arrested in Tokyo in 2018 on suspicion of financial misconduct, and Nissan then released him. Ghosn has repeatedly rejected all allegations.

effects on the automotive alliance

his exclusion led to a restructuring of the mighty automotive alliance between Nissan, Renault and Mitsubishi. This once largest automotive partnership in the world has drastically reduced its share of Nissan, which weakened the Japanese automobile manufacturer.

financial losses at Nissan

Nissan announced that the operating result between March and September has dropped 90 % compared to the previous year.

Honda’s ambitions for the future

also Honda, which is about five times the size of Nissan, sees challenges. The company plans to offer only emission -free vehicles in important markets by 2040. However, the transition is only slow, since relatively low petrol prices, insufficient charging infrastructure and increasing competition brake demand for electric vehicles in the USA and Europe

This article was written with information from CNN.