In a joint announcement, Japanese automotive giants Honda and Nissan confirmed on Thursday that they have terminated merger discussions initiated in December. Their original plan was to combine their operations under a single holding company, which would have positioned them as the world's third-largest automaker by value. However, after Honda proposed restructuring the tie-up to establish a relationship where it would assume the role of parent company, and Nissan would become its subsidiary, both firms decided to halt the integration process.
The companies explained that the decision to end the merger talks was driven by the need for rapid decision-making and agile execution of management strategies in an increasingly unpredictable marketplace, especially as the industry shifts toward electrification. Honda and Nissan stressed that this move would not adversely affect their financial outcomes, even as they continue to contend with market challenges, including a significant profit decline for Honda and a projected net loss for Nissan.
Additionally, Mitsubishi Motors had expressed interest in joining the proposed merger to create a combined entity valued at over $50 billion. Despite the collapse of the merger talks, the three companies confirmed that they remain committed to collaborating on electric vehicle technologies and smart car innovations, including projects related to autonomous driving.