Honda and Nissan have officially entered talks to merge into a single holding company, with Mitsubishi also considering participation.
The ambitious plan aims to finalise an agreement by June 2025 and complete the merger by August 2026.
If successful, the newly formed entity would become the world’s third-largest carmaker, trailing only Toyota and the Volkswagen Group, with an estimated annual output of 8 million vehicles.
The proposed merger follows a challenging period for Nissan, which recently implemented significant cost-cutting measures, including slashing 9000 jobs and reducing production capacity by 20%.
Despite these setbacks, Nissan’s shares surged by over 20% after news of the merger talks emerged.
In a joint statement, the three companies outlined their primary objective: maintaining global competitiveness while delivering innovative products and services. Honda CEO Toshihiro Mibe acknowledged the uncertainty surrounding the discussions, stating, “The possibility of this not being implemented is not zero.”
A Memorandum of Understanding (MoU) has been signed between Honda and Nissan, formalising their intent to explore the integration. Mitsubishi has also signed a separate MoU and will decide on its participation by January 2025.
The new holding company is expected to be formed through a joint share transfer, with final details on share ratios yet to be determined. If approved by shareholders, the entity will be listed on the Tokyo Stock Exchange by August 2026.
Honda is anticipated to lead the management of the newly merged company, with most directors and the president expected to come from Honda's leadership team.
Despite the integration, Honda, Nissan and Mitsubishi will retain their distinct brand identities while sharing vehicle platforms, powertrains and supply chain networks.
The integration will focus on reducing costs and complexity by streamlining research and development, production, and powertrain architectures across the brands' internal combustion engine (ICE), hybrid (HEV), plug-in hybrid (PHEV), and electric vehicle (EV) portfolios.
This strategic alignment mirrors established models like the Volkswagen Group and Stellantis, where multiple brands operate under a unified corporate umbrella while maintaining individual brand identities.
Nissan CEO Makoto Uchida described the talks as a “pivotal moment”, emphasising the potential to create “unparalleled value for customers worldwide.”
Honda's Toshihiro Mibe highlighted the synergy between the two automakers, expressing optimism about creating “new mobility value” through collaboration.
Meanwhile, Mitsubishi CEO Takao Kato remarked on the potential for maximising synergies, noting that the partnership could “bring high value” to Mitsubishi's collaborative ventures with Honda and Nissan.
If successful, the merger would not only reshape the Japanese automotive industry but also strengthen the global competitiveness of all three brands.
With a focus on shared technologies, streamlined production and global market reach, the proposed entity has the potential to set a new benchmark for efficiency and innovation in the automotive sector.
However, significant hurdles remain, including regulatory approvals, shareholder consensus and alignment of corporate cultures.
