Nissan, Honda announce merger, creating world’s third-largest carmaker. business and economy news
The plans were announced, including from Mitsubishi, as Japan tries to gain a foothold in the electric vehicle market.
Japan’s Honda and Nissan are planning a merger that would create the world’s third-largest carmakers as the industry transitions away from fossil fuels.
The company’s two presidents, Honda’s Toshihiro Mibe and Nissan’s Makoto Uchida, signed a memorandum of understanding on Monday that foresees the establishment of a holding company by August 2026, potentially putting them in the market after Toyota and Volkswagen. Can be placed at third place.
Honda, currently Japan’s second-largest carmaker, is widely seen as the only national partner capable of saving Nissan, which was ousted in 2018 after former Chairman Carlos Ghosn was accused of fraud and misappropriation of company assets. Has been struggling since his arrest.
Ghosn, who denies the charges and fled to Lebanon after being released on bail, described the planned merger as a “desperate move” in a video call with reporters on Monday.
Nissan, worth about $10 billion, said in November it was cutting 9,000 jobs, or 6 percent of its global workforce, and cutting its global production after reporting a quarterly loss of 9.3 billion yen ($60 million). Reducing capacity by 20 percent.
But the merger, which would also include Mitsubishi Motors, a smaller member of the Nissan alliance, could result in a value of more than $50 billion, depending on the market capitalization of the three automakers.
Honda’s Mieb said the company, currently valued at more than $40 billion, would initially lead the new management of the merged entity.
next generation
Carmakers in Japan have lagged behind their bigger rivals in electric vehicles and are trying to cut costs and make up for lost time.
The three companies, which announced in August that they would share components such as batteries for electric vehicles (EVs) and jointly research software for autonomous driving, will make about 8 million vehicles.
Honda to produce 4 million and Nissan to produce 3.4 million in 2023. Mitsubishi Motors earned just over 1 million.
Sam Fiorani, vice president of global automotive forecaster AutoForecast Solutions, said Nissan’s experience making batteries, electric vehicles and gas-electric hybrid powertrains could help Honda develop its EVs and next-generation hybrids.
The integration of the two storied Japanese brands would mark the biggest shakeup in the global auto industry since Fiat Chrysler Automobiles and PSA merged to form Stellantis in a $52 billion deal in 2021.
