The auto industry is undergoing an epochal transformation: and it seems Honda and Nissan have decided to face it together. merger announced among the historic Japanese brands is not just a financial operation: it is the response to a rapidly changing market, where competition in the electrical sector will be increasingly fierce. Let's take a closer look at this sensational "marriage".
The details of the agreement
The signing of a memorandum of understanding between Honda and Nissan paves the way for a merger that could create the world's third-largest automaker by sales, behind only Toyota and Volkswagen. Mitsubishi Motors, already an ally of Nissan, is evaluating joining the project and a decision is expected by the end of January.
The value of the deal? Considering the market capitalization of the three companies, the merger could create an entity worth more than $50 billion. Toshihiro Mibe, president of Honda, will initially lead the management of the new “Honda Nissan” (or whatever it will be called). The goal is to finalize the formal agreement by June and complete the transaction by August 2026.
The strategic motivations
Creating new value in mobility by combining resources, knowledge, talent and technologies that Honda and Nissan have developed over the years is essential to overcome the environmental changes that the automotive industry is facing.
Nissan CEO, Makoto Uchida, emphasizes how joining forces will enable them to offer unprecedented value to customers who appreciate their respective brands. The merger also represents a lifeline for Nissan, which saw its net profit plunge more than 90% in mid-2024, with a set of layoffs present and expected.
Honda Nissan, the critical voices
Not everyone sees the operation with a good eye. In an interview for Bloomberg, the former head of Nissan Carlos Ghosn called the merger a “desperate move,” arguing that synergies between the two companies are hard to spot. Ghosn, arrested in Japan in 2018 for alleged financial misconduct, is a definite thorn in Nissan’s recent history.
Nissan Honda: How will it end?
The new entity will face increasingly intense competition in the electric car market, dominated by Tesla and Chinese manufacturer BYD. The challenge will be to transform decades of experience in producing traditional cars into innovation in the field of electric mobility.
If the deal goes through, it will dramatically change the global automotive landscape. The merger could catalyze further consolidation in the industry as all automakers seek to navigate the transition to electric mobility with adequate resources.
The history of the automotive industry is littered with mergers and alliances, but this could be one of the most significant of the modern era, marking a turning point in the industry’s transformation to an electric future.
