Will the world's third-largest car manufacturer emerge in Japan by June 2025?
In Japan, the car giants Honda and Nissan are about to start merger talks. If an agreement is reached, the world's third-largest automaker could emerge.
When it comes to Japanese car giants, the first thing that comes to mind is Toyota, the world's largest car manufacturer. Now another giant could emerge in Japan. Japanese media reported that Honda and Nissan are talking about a possible merger. The schedule envisages that by June 2025, the extended cooperation up to a full merger should be in place.
The world's third-largest automaker could emerge
A joint venture between the two would become the third largest manufacturer in the world with almost eight million cars produced. Mitsubishi could also become part of the company, after all, Nissan holds 24% of the shares in the Japanese competitor. The idea of a merger is probably mainly due to the fierce competition in the course of the electromobility turnaround, in which Japanese companies do not yet have so many models on offer.
As early as March, the companies involved had announced that they would work together on the development of software and electric cars in order to achieve synergy effects and reduce their costs. In 2030, the first joint e-car is to be created from the cooperation, but now a much closer cooperation could be on the horizon. A letter of intent on merger talks is to be signed soon to initiate the official process. Then the consultations on intensified cooperation are to be completed by June 2025.
Nissan in der Krise
Nissan in particular is likely to be the driving factor in the talks, the carmaker had a catastrophic year with 90% less profit since April compared to the previous year 2023. Not only did Nissan suffer from the fierce battle for the Chinese market, but market shares have also collapsed in America, as the models on offer are relatively old and do not have hybrid variants.
As early as November, a cost-cutting program was announced at Nissan, which is expected to save almost 9000 jobs and a fifth of production capacity. Merger talks appear to be an appropriate means of steering the upcoming restructuring at Nissan into orderly channels. The Taiwanese electronics manufacturer Foxconn, mainly known for the production of the Apple iPhone, is also said to have shown interest in a takeover of Nissan, but Nissan apparently rebuffed the Taiwanese to prefer to talk to Honda. But Honda is also struggling with tougher competition and had to lower its profit forecast for the year to below 6 billion euros, almost 14% less than last year.
The Tokyo Stock Exchange recorded a gain for the share prices of Nissan and Mitsubishi after the news broke, while Honda's share price fell slightly. Officially, it was only reported that they were in talks about cooperation. According to reports, a press conference on the topic is planned for Monday.