Nissan CEO Uchida Resigns, Opening Door for Honda Merger Possibility

      Yuichi Yamazaki/AFP via Getty Images

      After weeks of speculation, Nissan confirmed that CEO Makoto Uchida will resign effective March 31. Uchida faced significant pressure to step down as the company dealt with declining sales, increasing debt, and a failed merger with Honda. Ivan Espinosa, Nissan's chief planning officer, will take over as CEO on April 1. Additionally, Nissan has made several other executive changes in an effort to find a route to recovery.

      Espinosa, 46, began his career at Nissan in 2003 as a product planner in the company’s Mexican division. He has held numerous roles since then, bringing extensive experience to the CEO position, but he will confront considerable challenges.

      Nissan's difficulties are well recognized. In November 2024, sources revealed that the company had “12 to 14 months to survive” without securing an investor, as executives announced plans to cut 9,000 jobs (around 6% of the workforce) and reduce global production capacity by 20%. The company is encountering obstacles in the United States and China, two major markets. Additionally, the merger with Honda fell through, and Nissan has yet to find an investor. In short, Nissan may have less than a year of viability ahead. What comes next?

      The implications of Uchida's departure for the scrapped merger with Honda remain unclear. The partnership was announced in December 2024 and was initially framed as a collaboration of equals despite the significant differences in size and revenue between them. Mitsubishi, in which Nissan holds a 24% stake, was also involved in the discussions but reportedly withdrew in January.

      A combination of Honda and Nissan could have established the world's third-largest automaker (after Toyota and Volkswagen), capitalizing on each other's strengths while saving on research and development and procurement costs. For instance, Honda could have manufactured vehicles at Nissan’s facility in Sunderland, England. It is not unreasonable to envision Nissan leveraging Honda’s technology to expedite hybrid production, or for Honda to benefit from Nissan’s expertise in electric vehicles.

      Ultimately, the merger could have provided Nissan with the lifeline it desperately needed. Executives from both firms had targeted August 2026 as a potential merger date, but discussions fell apart last month. Sources familiar with the negotiations indicated that the initial equal partnership concept shifted into a complete takeover attempt by Honda, which is valued at nearly five times more than Nissan and enjoys a solid financial situation.

      Nissan resisted becoming a subsidiary of Honda and found itself back at square one. Unofficial reports suggested a former Japanese politician was interested in proposing the brand to Tesla, while Taiwan-based electronics manufacturer Foxconn has been mentioned as a possible buyer for some time. However, Honda could reconsider the opportunity now that Uchida has departed. Insiders told the Financial Times in February that Honda was willing to reopen discussions if Nissan removed its CEO.

      Honda has not commented on the recent changes in Nissan's leadership.

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