It won't happen. It is Honda-Nissan merger officially off, an operation that would have created the third largest automotive group in the world. After last week's rumours, the official announcement came through a Joint Communiqué, in which the two car manufacturers announced theimpossibility of finding an agreement on the terms of integration.
Le main difficulties emerged over the governance model of the new entity and the position Nissan would take in the merger. In the end, the differences proved irreconcilable, leading the two companies to end negotiations.
Honda and Nissan are among the major Japanese automakers, second only to Toyota. Their merger would have created the third largest car manufacturing group in the world, surpassing Hyundai and Stellantis, and positioning itself immediately after Toyota and Volkswagen.
The operation was intended to strengthen the competitiveness of the two companies on the global market, with particular attention to the growing competition from Chinese automakers in the electric car sector.
Nissan: Kkr in the field?
What's new? The Kkr fund is considering investing in Nissan after the announced halt to the merger with Honda Motor. The US private equity giant, according to Bloomberg, would be in the initial phase of valuation of a stock or bond investment to improve Nissan's financial position.
Honda-Nissan: The Reasons for the Failed Marriage
Negotiations between the two Japanese companies have run aground mainly on some aspects:
- The governance model: Honda proposed a structure in which it would have greater operational control, turning Nissan into its subsidiary. Nissan firmly rejected this proposal, which instead aspired to a merger of equals, worried above all about losing its decision-making autonomy.
- Nissan's financial situation: the economic difficulties of the Yokohama company have further complicated the negotiations. Nissan is in deep crisis and reported a significant decline in profits and announced job cuts and production capacity reductions. Honda expressed concern about Nissan's slow pace of restructuring plans, believing they could jeopardize the success of the merger.
READ MORE: Nissan 91 years of successes and falls
Honda changes direction and focuses on new collaborations
After the conclusion of the negotiations, Honda will strengthen its strategies independentlyThe company is investing in the development of electric vehicles and advanced technologies, forming alliances with technology partners to maintain global competitiveness. In January, the Tokyo-based company announced a partnership with Sony for the production of intelligent electric vehicles, confirming the desire to innovate and diversify its collaborations.
But also the the already active collaboration with Nissan will not be interrupted. Despite the failure of the merger plan, Honda and Nissan will continue to work together on some strategic projects. Both companies, together with Mitsubishi Motors, will pursue synergies in the ssoftware development for intelligent vehicles and other innovations in the automotive sector. Without deeper integration, however, these initiatives will certainly be more limited than their initial ambitious goals.
Nissan is back in search of new partners
With the merger now off the table, Nissan must identify new strategic partners to support their transformation and face market challenges. Renault, which holds a significant stake in Nissan (the French they own 35% of the Japanese company, while the latter holds 15% of the French car manufacturer), has confirmed their support, but also expressed the intention to review the structure of the alliance to ensure greater balance between the parties.
Meanwhile, Taiwanese giant Foxconn comes forward again, which had already expressed interest in a possible collaboration with the group before Honda. Foxconn aims to expand its presence in the automotive sector, with a particular focus on electric vehicles.
Honda accelerates despite car sales decline, motorcycles rise
Honda also published today Financial results for the first nine months of the 2024-2025 financial year, confirming a solid performance. TheNet income stood at 805 billion yen (about 5 billion euros), registering a decrease of 7,9% compared to the previous year, while the operating profit increased by 5,9%, reaching 1.139 billion yen (7,01 billion euros). revenues increased by 8,9%, reaching 16.328 billion yen (101,5 billion euros).
Le motorcycle sales have grown significantly, with 15,5 million units compared to 13,96 million in the same period of 2023. On the contrary, the car sales have taken a hit, going from 3,11 million to 2,81 million units.
For the entire fiscal yearHonda expects revenue of 21.600 trillion yen, 600 billion more than its previous estimate, and profit before taxes of 1.465 trillion yen, with a increase of 30 billion compared to previous guidanceOperating margin is expected at 6,6%, slightly lower than initial forecasts.
On the sales front, the company has revised its lower forecasts for the auto sector, estimating 3,75 million units sold compared to the 3,8 million previously forecast. For motorcycles, however, estimates have been improved to 20,6 million units, compared to the 20,2 million previously indicated.
