As Lady Gaga sang, “You and me could write a bad romance.” Many assumed the same about the Honda and Nissan merger talks, but it looks like there will be no romance between the carmakers due to finance-related matters.
A Nikkei report cites that Nissan will be pulling the plug on the merger talks as both parties couldn’t come to a consensus on the terms.
Previously, Honda had hinted at Nissan being its subsidiary, but Nissan felt this wasn’t in the spirit of the initial discussions that placed both on equal footing. Simultaneously, Honda was extremely concerned about Nissan’s plans to reverse its spiralling fortunes.
Furthermore, the impending US-Mexico tariffs would hit Nissan harder, as stated by analyst Vincent Sun to Reuters.
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On paper, the merger would have birthed the world’s third-largest carmaker by sales valued at over USD60 billion (approx. RM265 billion). Nonetheless, Nissan continues to struggle and recently announced 9,000 job cuts to reduce production by 20%.
The original plan saw both parties pen a memorandum of understanding (MoU) in December 2024 to discuss the possibility of a merger under a joint holding company. A basic agreement for Alliance member Mitsubishi to form the third pillar of this merger was also in place.
Despite later reports indicating that Mitsubishi was to pull out, both parties were looking forward to a definitive agreement in place by June 2025. That doesn’t look to be the case anymore.
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