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Japanese carmaker Nissan is backing out of merger talks with rival Honda. The merger was estimated to be worth more than $50 billion.
In a sharp turn from a previous plan to integrate the struggling company under a new holding company, Honda proposed making Nissan its subsidiary, the Nikkei business daily and other local media reported Wednesday.
“Strong opposition” within Nissan to this proposal was behind its decision to withdraw from the talks, the Nikkei said. Tokyo-based private broadcaster TBS published a similar report.
Discussions on setting up a holding company were launched in December but faltered as the two companies disagreed on the integration ratio and other conditions, the newspaper added.
Nissan said in a statement it had not announced anything officially, but the two companies “are in the stage of advancing various discussions, including the contents of the report.”
“We plan to establish a direction and make an announcement around mid-February.”
Nissan stock plunged 4.8% on the Tokyo Stock Exchange on Wednesday before the TSA suspended their trading, saying the media reports on the merger’s cancellation needed to be verified.
Honda shares closed 8.2% higher, having soared nearly 12% at one point.
Nissan and Honda agreed in December to start talks on joining forces to create the world’s third-largest automaker — seen as a bid to catch up with Tesla and Chinese electric vehicle firms.
Turbulent times for Nissan
Honda’s CEO insisted at the time it was not a bailout for Nissan, which last year announced thousands of job cuts after reporting a 93% plunge in first-half net profit.
Business has been tough for foreign brands in China, where electric vehicle manufacturers such as BYD are leading the way as demand grows for less polluting vehicles.
Nissan has weathered a turbulent decade, including the 2018 arrest of former boss Carlos Ghosn, who later jumped bail and fled Japan concealed in a music equipment box.
China overtook Japan as the biggest vehicle exporter last year, helped by government support for EVs.
Honda and Nissan are Japan’s No. 2 and 3 automakers after Toyota.
They already agreed last year to explore a partnership on EV software and components among other technologies, an initiative joined by Mitsubishi Motors in August.
But the smaller automaker’s chief said this week it would make a final decision on whether to join the Honda-Nissan merger talks in mid-February or later.
In December, reports said Taiwanese electronics behemoth Foxconn had unsuccessfully approached Nissan to acquire a majority share.
It then reportedly asked Renault to sell its 35 percent stake in Nissan — a pursuit that was put on hold before the merger talks were announced.
Nissan has weathered a turbulent decade, including the 2018 arrest of former boss Carlos Ghosn, who later jumped bail and fled Japan concealed in a music equipment box.
The company is also saddled with billions of dollars of debt that will reportedly mature over the next two years.
© 2025 AFP
