Nissan and Honda officially confirm merger talks, Mitsubishi might join
Last week sources left and right claimed Nissan and Honda had entered merger talks, and today the two companies have confirmed those reports.
Nissan and Honda have started to discuss a merger, in a move to stave off the threat they both face from Chinese EV makers. Mitsubishi, in which Nissan is the top shareholder, is also apparently "considering" joining.
If the merger eventually happens following these talks, the combined company would become the world's third-largest auto group by vehicle sales, after Toyota and Volkswagen, and would sell more than 8 million cars globally each year. The new company would dethrone the Hyundai and Kia group, which is currently No.3.
Of course, the merger would also help both brands better compete with Tesla and Chinese EV makers such as BYD. Currently, Honda is Japan's second-largest automaker and Nissan is No.3.
Honda CEO Toshihiro Mibe said:
The rise of Chinese automakers and new players has changed the car industry quite a lot. We have to build up capabilities to fight with them by 2030, otherwise we'll be beaten.
Such a merger would create the biggest change in the auto world since Fiat Chrysler and PSA Peugeot Citroen merged in 2021 to create Stellantis.
The merger talks between Honda and Nissan (and potentially Mitsubishi too) should be wrapped around June next year. If they agree on a deal, a holding company will then be set up by August 2026, and at that point both Nissan's and Honda's shares would be delisted.
Honda would appoint the majority of the new entity's board, as it is the bigger company, with a current market cap of over $40 billion, while Nissan is only valued at about $10 billion.
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