The potential merger between Honda and Nissan, possibly including Mitsubishi, has been a major topic of discussion in the automotive industry. This merger could create the world’s third-largest car company, causing a seismic shift in the industry, but the situation remains uncertain.
Reports surfaced late last month that Mitsubishi might not join the merger, as it wants to remain independent for greater flexibility and agility in decision-making to focus on the Southeast Asian market, a key region for the three-diamond brand.
Now, during an announcement of Mitsubishi Motors third quarter results for 2024, the company’s President and CEO, Takao Kato stated that the company is still exploring all options. According to Kato, this does not mean that Mitsubishi has decided not to merge with Honda and Nissan.
A decision was initially expected by the end of January 2025, but it has been pushed to mid-February, with Kato citing delays between Nissan and Honda in unveiling their plans for the merger, Kyodo News reports.
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Earlier in 2024, Nissan and Honda have announced a partnership on electric vehicle (EV) and artificial intelligence (AI) development in response to the growing dominance of Chinese EVs.
A potential merger between Nissan and Honda, possibly including Mitsubishi, could lead to significant collaborations between these Japanese carmakers.
The merger could be a lifeline for Nissan, which is currently facing a financial crisis. To illustrate the severity of the situation, the company ended 2024 with a quarterly loss of USD 61 million.
This has led to 9,000 jobs being cut globally and production being reduced by 20%, along with the sale of some of its shares in Mitsubishi. Even Nissan’s CEO, Makoto Uchida, had to take a 50% pay cut during a recent management reshuffle.
Honda CEO Toshihiro Mibe, highlighted the urgency of the situation, stating that the merger hinged on Nissan’s financial recovery. A senior official previously commented that Nissan had only “12 or 14 months to survive.”
But, this raises questions about the future of the Renault-Nissan-Mitsubishi Alliance. Renault currently holds shares in Nissan, and a merger with Honda could create conflicts of interest. Mitsubishi’s involvement further complicates the situation.
Adding to the complexity, Honda recently asked Nissan if it could acquire Renault’s 35.7% stake in Nissan, valued at USD 3.6 billion, Carscoops reports.
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