Honda-Nissan Merger Talks Reportedly Stalled Over Disagreements About Future Structure

Negotiations around the massive $60 billion merger proposed between Japanese automotive giants Honda and Nissan might fall apart due to reported disagreements about how the two entities would continue functioning when they are part of a combined corporate structure. Citing unnamed sources, Reuters reports that there have been differences of opinions between the two firms as talks have been proceeding, and they have now reached a point where the talks might be scrapped altogether. At the heart of the matter is a purported assertion by Honda that Nissan should become a subsidiary, while Nissan wants to be on an equal footing as its counterpart within a joint holding company.

As per a Nikkei story, Nissan’s board has already agreed to step back from all merger talks and continue operating as an independent company. However, the companies might still be open to restarting discussions. The two companies have not publicly announced any change of plans and have recently asserted that their talks will be finalised in February, after having initially targeted the end of January.

The merger, announced on December 23 with the signing of a Memorandum of Understanding, would result in the creation of the world’s third-largest automaking conglomerate. Japan’s Mitsubishi Motors is also in discussions to join the proposed entity, while France’s Renault, which owns 36 percent of Nissan, has stated that it supports the merger proposal.

Honda is significantly larger than Nissan in terms of market value and sales rankings. The two companies initiated merger discussions as both have struggled in recent years to compete with younger automobile manufacturers, especially some recent Chinese EV-focused firms, in markets around the world. The companies had earlier entered multiple strategic partnerships to collaborate on developing EVs and connected cars. 

The talks were reportedly centred around standardising platforms and leveraging combined scale, research and development integration, supply chain optimisation, and combining sales and financing operations. The process combining both firms was expected to take over a year, with the new entity replacing both Honda and Nissan on the Tokyo Stock Exchange no earlier than August 2026.