Nissan and Honda to merge in historic move: Strategic decision to create a new era of mobility

As the automotive industry enters a once-in-a-century period of transformation , some surprising news has arrived. Nissan Motor Co., Ltd. and Honda Motor Co., Ltd., two of Japan’s leading automakers, announced on December 23, 2024, that they have agreed to begin discussions and considerations toward a business integration and have signed a memorandum of understanding.

This is more than just a merger of two companies; it is an extremely important decision that will determine the future of Japan’s automotive industry .

Nissan and Honda Business Integration: Summary

Background to the merger: The rapidly changing automotive industry and the challenge of survival

This business integration is taking place against the backdrop of dramatic changes in the environment surrounding the automotive industry . The industry is undergoing an unprecedented period of transformation, including technological innovation known as CASE (Connected, Autonomous, Shared & Services, Electric), the acceleration of electrification toward achieving carbon neutrality, and intensifying global competition.

Under these circumstances, Nissan and Honda have decided that there are limits to what can be achieved through individual corporate efforts alone , and have chosen to integrate their businesses in order to maintain and strengthen their global competitiveness by combining the strengths of both companies and to create a new mobility society.

The two companies began considering competing in March 2023 and officially announced their intention to do so in August. Since then, they have held numerous discussions regarding collaboration in various fields. Through these discussions, they came to the realization that by combining the technologies, know-how, and brand power of the two companies, they could create even greater synergies , leading to the agreement to integrate their businesses.

Purpose of the integration: Creating new value in mobility and leaping to become a global leader

Nissan and Honda aim to become leading companies that create new value in mobility . By combining their management resources, they aim to provide innovative mobility services that will change people’s perceptions of mobility, centered on electrification and intelligence.

This integration is not limited to simply integrating our automobile businesses. By integrating Honda’s motorcycle and power products businesses, we aim to develop a broader range of mobility businesses and enrich the lives of people around the world.

Strengthening our competitiveness in the global market is also an important goal. By leveraging economies of scale to optimize our research and development and production systems, and by integrating our sales finance functions, we aim to solidify our position as a world-class automaker .

Details of the integration: Aiming to maximize synergies on an equal footing

Specifically, Nissan and Honda will establish a joint holding company and make both companies wholly owned subsidiaries.

It is important to note that the integration will be carried out on an equal footing, respecting the brands of both companies . Honda will nominate the majority of the directors of the joint holding company, but this is merely a formality, and the purpose of the structure is to maximize the strengths of both companies .

Mitsubishi Motors is also considering the possibility of joining the business integration, and plans to make a decision on whether to join the business integration by the end of January 2025. With Mitsubishi Motors joining the company, it is expected that the synergy effects between the three companies will be further enhanced , resulting in an even stronger corporate entity.

Integration schedule: Aiming for listing in August 2026

The schedule for the business integration is as follows:

• June 2025: Official contract concluded
• August 2026: Joint holding company established and listed

Mitsubishi Motors will decide whether to participate in the business integration by the end of January 2025.

Challenges and Prospects of Integration: The Challenge of Creating New Value

Of course, business integration also presents various challenges, such as differences in corporate culture, streamlining overlapping businesses, and integrating human resources.

However, both companies aim to overcome these challenges and become companies that can create new value .

Nissan aims to achieve further growth through the business integration by steadily implementing turnaround initiatives and establishing a solid business foundation.

Honda will combine its motorcycle and power product businesses to create new value by leveraging its knowledge of intelligent electrification technology.

Mitsubishi Motors will support both companies in areas of expertise such as small pickup trucks, aiming to strengthen competitiveness and expand business.

Each company’s thoughts: Hope and determination for the future

Nissan has stated that through this business integration, it will strengthen its position as a global automaker and promote efforts to address environmental issues and create a safer society.

Honda aims to be a leader in the evolution of mobility, respect the brands of both companies, and create synergies.

Mitsubishi Motors aims to maximize synergy effects by strengthening its relationship with both companies, while strengthening its competitiveness and expanding its business.

Future after integration: Towards becoming a world-leading mobility company

The merger of Nissan and Honda will mark a major turning point for Japan’s automotive industry . Through this integration, the two companies aim to evolve into leading global mobility companies and shape the future of human mobility. I hope that this historic merger will significantly contribute to revitalizing the Japanese economy and realizing a sustainable society .

Nissan and Honda’s business integration: My predictions for the future

With the merger of Nissan and Honda, the two companies are expected to share their technologies and platforms, leading to the emergence of innovative new car models. While it is difficult to predict the specific models, let’s consider some possibilities.

1. Integration of electrification technologies

• High-performance EV : By combining Honda’s leading electrification technology with Nissan’s EV development know-how, there is the potential to develop an EV that is among the world’s best in terms of range, charging speed, and driving performance.
• Next-generation hybrids : Vehicles may be introduced that combine Honda’s e:HEV and Nissan’s e-POWER to offer more efficient and fuel-efficient hybrid systems.
• Fuel cell vehicles : The two companies may combine their fuel cell technologies to develop more practical fuel cell vehicles.

2. Evolution of autonomous driving technology

• Advanced Autonomous Driving : The two companies may combine their autonomous driving technologies to develop vehicles with safer and more advanced autonomous driving systems.
• Vehicles for MaaS : Vehicles that utilize autonomous driving technology and are specialized for MaaS (Mobility as a Service), such as ride-sharing and car-sharing, may be introduced.

3. Platform Sharing

• Common platform : Sharing a platform between the two companies will reduce development costs and enable the efficient development of a wider range of vehicle models, from compact cars to SUVs and sports cars.
• Unique derivative vehicles : Based on a common platform, there is a possibility that derivative vehicles with unique designs and functions will be released, taking advantage of the respective Nissan and Honda brand images.

4. New Mobility

• Mini-mobility : There is the potential to jointly develop compact, environmentally friendly mini-mobility vehicles suitable for urban travel.
• Flying cars : In the future, the two companies may combine their technologies to develop new forms of mobility, such as flying cars.

5. Other

• Sports Car : A high-performance sports car could be born to replace the Nissan GT-R and Honda NSX.
• Pickup trucks : Using Mitsubishi Motors’ expertise, Nissan and Honda could potentially sell pickup trucks under their brands.

These forecasts are merely examples, and the actual vehicle lineup will depend largely on market needs, technological advances, and the post-merger corporate strategy.

However, there is no doubt that the merger of Nissan and Honda will combine the strengths of both companies and hold great potential for creating innovative mobility that has never been seen before . I will be keeping an eye on future developments.

Related reading

Nissan, Honda, and Mitsubishi Motors to sign memorandum of understanding to explore strategic partnership for next-generation SDV platform… Nissan Motor Co., Ltd. (Nissan), Honda Motor Co., Ltd. (Honda), and Mitsubishi Motors Corporation (Mitsubishi Motors) signed a memorandum of understanding on March 15, 2024…

Nissan news release

https://global.nissannews.com/en/releases/241223-01-e