The ambitious $60 billion merger between Honda and Nissan, which would have created the world’s third-largest automaker, has encountered unexpected hurdles and is now teetering on the brink of collapse.
Ars Technica reported on Wednesday that while Honda and Nissan announced merger negotiations last December, the talks have since stalled. After disagreeing on key integration terms, the two Japanese automotive giants withdrew their memorandum of understanding (MOU).
Industry insiders suggest that Nissan executives were caught off guard by Honda’s aggressive “take it or leave it” approach. This led to significant pushback from Nissan’s board of directors, who opposed Honda’s proposal to make Nissan a subsidiary. The board has postponed their final decision until next week.
Nikkei first reported the suspended negotiations. Both companies remained cautious, telling the agency, “We are still in discussions and aim to finalize our direction by mid-month.”
Honda and Nissan, Japan’s second and third-largest automakers, respectively, had initially planned to form a holding company by August 2026 to facilitate their merger. However, the announcement of integration plans has been delayed longer than anticipated.
It is speculated that Honda has raised objections to Nissan’s proposed management restructuring measures.
The global automotive industry is closely watching these developments. A successful merger would catapult the combined entity to the world’s third-largest automaker position. However, the potential collapse of this deal could significantly reshape the industry’s competitive landscape.
