알파경제 - Honda-Nissan Merger Talks Collapse Over Disagreements on Integration Terms

[Alpha Biz= Kim Jisun] The proposed management integration between Japanese automakers Honda and Nissan is on the verge of collapse as negotiations have stalled due to disagreements over merger conditions.


According to the Nikkei newspaper on Wednesday, Nissan, which had been exploring a holding company-style merger with Honda, has decided to halt negotiations. The company has also reportedly decided to withdraw from the previously agreed Memorandum of Understanding (MOU), although it may reconsider reopening discussions in the future.


The Asahi Shimbun also reported, citing multiple sources, that both companies plan to convene board meetings soon to discuss the suspension of merger talks. Honda, frustrated with the lack of progress, proposed turning Nissan into a subsidiary, a move that Nissan strongly opposed. A Nissan executive told the Yomiuri Shimbun, "It is nearly impossible to reach conditions that would be acceptable to both sets of shareholders. It’s no longer feasible."


Initially, Honda and Nissan aimed to outline the integration plan by the end of January but postponed the timeline to mid-February due to ongoing difficulties.


The merger plan, announced in December 2023, envisioned the creation of a joint holding company by August 2026, under which both automakers would be consolidated. However, amid Nissan’s deepening financial struggles—exacerbated by declining sales in North America and China—Honda reportedly sought to acquire Nissan shares and take control to accelerate restructuring efforts.


Nissan has initiated workforce reductions in its North American and Thai operations, but restructuring in other regions has faced resistance, delaying its turnaround efforts. A Honda official told Yomiuri Shimbun, "Nissan lacks a sense of urgency, and Honda no longer has the capacity to keep up with this situation."


While the Nikkei reported that negotiations have officially collapsed, both companies responded that they are still in discussions and aim to announce a final decision by mid-February.


In 2023, Honda ranked as the world's seventh-largest automaker with 3.98 million units sold, while Nissan ranked eighth with 3.37 million units. A combined entity would have an annual sales volume of 7.35 million vehicles.

알파경제 Kim Jisun (stockmk2020@alphabiz.co.kr)