Nissan suspends merger talks with Honda

Japanese carmaker Nissan has suspended merger talks with Honda. This probably brings to an end to all discussions that could have created the world’s third-largest car manufacturer behind Volkswagen and Toyota.

It concludes months of behind-the-scenes negotiations. The two Japanese auto manufacturers, as well as Mitsubishi Motors (in which Nissan is a major shareholder), let it be know last December that they were exploring a merger, having signed a memorandum of understanding.

Mitsubishi withdrew from the discussion late last month (January), and now the news has broken that Nissan has stepped away from all merger talks with Honda.

It is being widely reported that the main disagreements were about Nissan’s role going forward. It is speculated that the much larger Honda valuation might lead to it being represented in a very dominant position in the future direction of the proposed new giant entity.

Nissan is now reported to be seeking new technical partners.

Renault previously held 43 per cent stake in Nissan. However, in 2023 both companies revised their capital relationship, agreeing to have 15 per cent cross-shareholding in each other. Nissan has reached this level, and Renault is still in the process of reducing its holding in Nissan to the agreed new level.