Merger between Honda and Nissan is officially over

According to press releases from Honda and Nissan, both automakers have confirmed that their MOU (memorandum of understanding) has now been terminated, meaning that their planned merger is officially over.

In December 2024, Honda and Nissan announced that there was going to be a merger between the two automakers. The negotiations were to be finalised in June 2025, followed by the creation of a holding company which will start operations in 2026, with Mitsubishi Motors initially being included as well.

The merger was meant to reduce costs of electric vehicle development, while also sharing technologies and software between the three automakers, so as to help them compete with rising global EV giants such as BYD and Tesla. 

If the merger had gone through successfully, it would have created the world’s third largest automaker group behind leader Toyota and runner-up Volkswagen Group.

However, Honda wasn’t convinced that Nissan could achieve a financial turnaround despite the struggling automaker cutting 9,000 employees and reducing its global production capacity by 20%. Therefore, Honda had proposed a new offer, which was to make Nissan its subsidiary company. 

Naturally, Nissan’s higher-ups weren’t thrilled about the offer, as the signed MOU stated that both automakers are to have equal footing in the holding company. By then, Mitsubishi Motors had already pulled out of the merger, stating that it could not find the benefits for the company in the merger. 

The drama escalated when reports of Nissan’s CEO meeting Honda’s counterpart to cancel talks had surfaced on Nikkei Asia. Both automakers’ representatives had refused to answer any questions, stating that the final decision would be made in mid-February.

“As a result of these discussions, both companies concluded that, to prioritise speed of decision-making and execution of management measures in an increasingly volatile market environment heading into the era of electrification, it would be most appropriate to cease discussions and terminate the MOU,” stated the press release.

While the merger is ultimately not proceeding, Nissan has already announced that it is looking for a new partner, with Foxconn being a potential candidate. The world's largest electronics manufacturer has expressed interest in collaborating with Nissan, but the automaker hasn’t given an official response as of yet.

Nissan, Honda and Mitsubishi (bosses) won't be working together after all.

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