► Nissan and Honda to discuss ‘business integration’
► The two were already working together on tech
►‘Business environment for both companies has rapidly changed’
After many rumours and discussions, Nissan and Honda have officially announced that they have signed a memorandum of understanding to discuss ‘business integration.’
The idea has been discussed for a while now, as the two car brands face some trying times. The pair have already been working together across 2024, first in electrification and then exploring the subjects of software-defined vehicles and more besides.
Since then, though, the two car brands acknowledge that ‘the business environment for both companies and the wider automotive industry has rapidly changed, and the speed of technological innovation has continued to accelerate.’ These are just talks, however – the merger hasn’t happened yet.
Nissan has been seeking a stakeholder since November 2024, according to the Financial Times, in order to stabilise its business as Renault – its major Alliance partner – sells down its share in the Japanese brand. Nissan has also had to cut production and lay off around 9000 employees globally due to slumping sales. Given Mitsubishi’s attachment to Nissan and Renault in the Alliance, Mitsubishi is also named as part of the merger.
In a statement, Nissan says: ‘if the business integration can be realised, both companies can aim to integrate their respective management resources such as knowledge, human resources, and technologies; create deeper synergies; enhance the ability to respond to market changes; and expect to improve mid- to long-term corporate value.
‘Additionally, Nissan and Honda can aim to further contribute to the development of Japan’s industrial base as a “leading global mobility company” by integrating Nissan and Honda’s four-wheel-vehicle and Honda’s motorcycle and power products businesses, enabling the brands of both companies to become more attractive and to deliver more attractive and innovative products and services to customers worldwide.’
Makoto Uchida, CEO and President of Nissan, says that, if the merger happens, ‘I believe that by uniting the strengths of both companies, we can deliver unparalleled value to customers worldwide who appreciate our respective brands. Together, we can create a unique way for them to enjoy cars that neither company could achieve alone.’
Honda director, Toshihiro Mibe, says: ‘We are still at the stage of starting our review, and we have not decided on a business integration yet, but in order to find a direction for the possibility of business integration by the end of January 2025, we strive to be the one and only leading company that creates new mobility value through chemical reaction that can only be driven through synthesis of the two teams.’
The two companies point to several advantages to merging. Both brands say doing so will improve economies of scale by sharing car architectures, and saving costs by streamlining R&D. The announcement also posits potential benefits for ‘optimising’ their manufacturing, and remaining competitive in the market. That last point is likely due to the increasing number of car makers coming from China that are increasing their stake in the market with competitive products – something Nissan and Honda, at least for now, haven’t had despite both brands being electrification and tech pioneers.