Honda and Nissan Postpone Merger Update Until Mid-February | Carscoops

      As Honda and Nissan move towards a merger, Mitsubishi may choose to remain independent.

      15 hours ago

      by Brad Anderson

      The two Japanese automakers initially intended to announce details of their merger by the end of January.

      Reports indicate that Honda is closely examining Nissan’s restructuring efforts before proceeding.

      Mitsubishi appears to prefer remaining independent, favoring partnerships over a complete merger with Honda and Nissan.

      The automotive industry was surprised in December when Honda and Nissan disclosed that they were in talks to form a single company. The announcement of key details, originally set for late January, has now been delayed until mid-February.

      Carlos Ghosn, former head of Nissan and Renault, claims that Honda’s participation in these discussions may not be entirely voluntary. He insinuates that Japan’s Ministry of Economy, Trade, and Industry is pressuring Honda to merge in order to support Nissan. In turn, Honda has made it clear that for the merger to progress, Nissan must demonstrate its ability to improve operationally and financially.

      Reports from unnamed sources suggest that Honda seeks more time to evaluate Nissan’s restructuring plans before making further commitments. Nissan has announced plans to cut 9,000 jobs globally, reduce global production capacity by 20%, and implement early retirement programs at three U.S. plants. However, despite these actions, Kyodo News reports that Honda remains unconvinced and is looking for Nissan to adopt even more aggressive cost-cutting measures.

      Concerning Mitsubishi, the company has been loosely involved in the discussions but seems reluctant to join. Sources indicate that it prefers to remain publicly traded and may instead focus on limited collaborations with Honda and Nissan in the future. Mitsubishi is expected to make a final decision on its course of action this month.

      Nissan faces a significant challenge if it hopes to achieve its targets before the tentative August 2026 merger deadline, requiring approximately 400 billion yen ($2.6 billion) in fiscal 2026. This presents a formidable task, especially since its operating profit has sharply decreased from 336.7 billion yen ($2.3 billion) to merely 32.9 billion yen ($225 million). Additionally, its net income for the first half of fiscal year 2024 plummeted 93.5%, dropping from 296.2 billion yen ($2.02 billion) to just 19.2 billion yen (~$131 million).

      Honda President and CEO Toshihiro Mibe stated clearly, “The integration will not be realized unless Nissan and Honda execute it as two companies capable of standing on their own.”