Nissan, Honda announce merger plans, to finalise deal by June 2025

Two Japanese auto giants, Nissan and Honda, have agreed to explore a merger and set up a joint holding company.

The companies announced the move in a statement on Monday after signing a memorandum of understanding (MOU) to start discussions and considerations regarding a business integration and the establishment of a joint holding company.

According to the statement, the two companies would aim for combined sales of 30 trillion yen ($191 billion) and operating profit of more than three trillion yen through the potential merger.

The companies said the deal is expected to be finalised by June 2025, with the formation of the holding company slated for August 2026, at which point its shares will be listed, leading to the delisting of both Honda and Nissan. 

“To further accelerate their efforts toward achieving a carbon-neutral society and a zero-traffic-fatality society, Nissan and Honda signed an MOU on March 15 regarding a strategic partnership for the era of vehicle intelligence and electrification,” the statement reads.

“Since then, the two companies have held discussions aimed at collaboration in various fields.

“On August 1, both companies signed a further MOU to deepen the framework of the strategic partnership. 

“The MOU between Nissan and Honda announced today is aimed to serve as an option to maintain global competitiveness and for the two companies to continue to deliver more attractive products and services to customers worldwide.

“If the business integration can be realized, both companies can aim to integrate their respective management resources such as knowledge, human resources, and technologies; create deeper synergies; enhance the ability to respond to market changes; and expect to improve mid- to long-term corporate value.”

‘DEAL AIMED TO CREATE NEW MOBILITY VALUE’

Speaking on the deal, Makoto Uchida, Nissan president and chief executive officer (CEO) said the deal marks a pivotal moment “as we begin discussions on business integration that has the potential to shape our future”.

“If realized, I believe that by uniting the strengths of both companies, we can deliver unparalleled value to customers worldwide who appreciate our respective brands,” Uchida said.

“Together, we can create a unique way for them to enjoy cars that neither company could achieve alone.”

On his part, Toshihiro Mibe, director at Honda, said the deal marks the creation of new mobility value by bringing together the resources “including knowledge, talents, and technologies that Honda and Nissan have been developing over the long years is essential to overcome challenging environmental shifts that the auto industry is facing”.

“Honda and Nissan are two companies with distinctive strengths. We are still at the stage of starting our review, and we have not decided on a business integration yet, but in order to find a direction for the possibility of business integration by the end of January 2025,” he added.

“We strive to be the one and only leading company that creates new mobility value through chemical reactions that can only be driven through synthesis of the two teams.”

Honda, Japan’s second-largest automaker, is valued at over $40 billion, while Nissan, in third place, has a market capitalisation of around $10 billion.