Honda and Nissan officially agree to talk merger

Japanese automakers Honda Motor Co. and Nissan Motor Co. Ltd. along with Mitsubishi Motors announced on Monday that they have signed a memorandum of understanding (MoU) to begin discussions on a potential merger.

The proposed business integration, which includes establishing a joint holding company, is seen as a strategic move to enhance their competitiveness in the electric vehicle (EV) market and counter the dominance of Tesla and Chinese rivals.

The merger aims to achieve combined annual sales of 30 trillion yen and an operating profit exceeding 3 trillion yen.

According to the companies, they plan to finalize discussions by June 2025, with the holding company expected to be operational by August 2026.

Shares of both Honda and Nissan will be delisted between end of July and August 2026, coinciding with the establishment of the holding company, which will subsequently be listed on the stock exchange.

Leadership of the joint venture will see significant influence from Honda, with the company appointing the president and the majority of the internal and external board members.