The Honda-Nissan merger could actually happen

Automotive giants Honda and Nissan are reportedly considering a merger between the two Japanese companies in order to explore various possibilities for future collaboration and leverage their respective strengths, according to a statement from representatives of both companies.

Both companies have been facing significant difficulties for some time.

Honda and Nissan are discussing a possible merger, potentially bringing together two Japanese automaking titans that have recently fallen on hard times.

— CNN (@cnn.com) 2024-12-18T01:30:43.007Z

Although few details have been released by the companies, talks reportedly began last spring.

According to CNN, a third automaker could join the merger, with Mitsubishi involved in major discussions within the Japanese automotive sector.

Japanese automakers are facing increasing difficulties, largely due to the rise of Chinese brands.

Once a key market for Japanese companies, Chinese consumers are now favoring their own manufacturers, including BYD, Wuling, Geely, Changan and Nio, which are growing rapidly and redefining automotive industry standards, particularly in the electric vehicle sector.

The latter are perceived as offering better value for money, particularly since the Chinese government introduced incentives to accelerate the population’s adoption of electric and plug-in hybrid vehicles.

Japanese automakers, once leaders, are struggling to establish themselves in the electric and hybrid vehicle market.

This competitive lag places these companies at a critical point, close to an irreversible turning point, prompting Honda, Nissan and possibly Mitsubishi to consider drastic measures to meet these challenges.