Nissan has decided to end merger talks with Honda

The Board of Directors of Nissan has decided to terminate negotiations on a merger with Honda, which would have led to the creation of the third largest automaker in the world. This was reported by the Japanese edition of Nikkei on February 5.

According to its sources, the negotiations were complicated by growing disagreements between the two Japanese automakers. The merger was originally conceived as an equal union that would create the third-largest automaker after Toyota and VW in 2026 and better counter Chinese companies.

However, Honda then wanted to make Nissan its subsidiary, which did not please the management of the latter, the publication writes.

In turn, the concern of Honda, the second largest Japanese manufacturer with a market value of about 7.92 trillion yen was the state of Nissan, with a market value of 1.44 trillion yen. Japan's third largest manufacturer is in the process of restructuring with plans to cut 9,000 employees and 20% of global production capacity.

The merger talks were also influenced by US President Donald Trump's announcement of duties against Mexico, which will be more painful for Nissan than for Honda or Toyota.

Following the Nikkei report, Nissan shares fell more than 4% on the Tokyo Stock Exchange and trading was temporarily suspended. The stock continued to trade and rose more than 8%.

Initially, Nissan and Honda said they planned to make a decision on the direction of integration by the end of January, but this was later pushed back to mid-February. In addition, Reuters has learned that Mitsubishi Motors, Nissan's alliance partner may not join the merger.

On January 30, Toyota Motor shared global sales statistics. By the end of 2024, the Japanese company sold 10.82 million vehicles, including Lexus, Daihatsu and Hino brands, and became the world's largest automaker for the fifth consecutive time. Toyota was not hampered by a 3.7% year-end sales drop. Separately, sales of Toyota and Lexus brand vehicles fell 1.4% year-over-year (to 10.16 million units). At the same time, sales of Toyota's electrified vehicles grew by 23.2% over the year to 4.53 million units.