Embattled carmaker, Nissan, is exploring options to turn its fortunes around amid current financial struggles. One of those options is a possible merger with fellow Japanese carmaker, Honda. Nikkei Asia reports that the two are currently in talks for a possible merger.
Honda and Nissan have independently issued statements that no merger has officially been announced. However, these talks could be the start of a possible collaboration between the two. It is not clear if the two are discussing a full merger, joint venture, or collaboration.
Earlier in August, the two companies have agreed to carry out joint research in fundamental technologies relating to electrification, intelligence, and onboard software. The research encompasses new battery technologies, electric vehicle axles, and even sharing energy services for charging vehicles. The joint research also covers the development of software-defined vehicle platforms, which includes connectivity, AI, and autonomous driving.
Tougher competition
This possible merger comes at an opportune time as Chinese carmakers are in the midst of an aggressive electric vehicle push in markets outside of its own. While Honda and Nissan may have begun research and development on electrification far earlier than Chinese carmakers, in recent years, they have been overtaken by the sheer volume and quick development of vehicles produced by the many new auto brands from the country.
It is hoped that the collaboration can help the two brands produce more appealing and competitively priced vehicles compared to those produced by China, which has made headway thanks to the sheer variety of options and competitive pricing.
Nissan was among the first automakers to offer a fully electric vehicle model, the LEAF. However more recent competitors offered larger models with larger batteries and longer ranges. Its E-Power hybrid models were hoped to appeal to buyers in countries where EV infrastructure is still being developed. However, these models face tough competition against those offered by Toyota and Honda.
Honda, meanwhile, has aggressively been pursuing multiple partnerships when it comes to electrification. At 2023’s Tokyo Mobility Show, Honda presented its prototype electric vehicle produced with electronics giant, Sony, called the Afeela. It also showcased a hydrogen fuel cell truck co-developed with Isuzu, called the Giga H2.
Merger of giants
With such a possible merger or collaboration with Honda, Nissan may gain access to much of Honda’s expertise in hybrid power, smart safety systems, and hydrogen fuel cell technology. Honda, meanwhile, may learn a thing or two from Nissan’s compact battery construction and vehicle-to-load technology that allows the EV to power a house in the event of an emergency.
The result could mean the two brands sharing platforms to produce distinct vehicles and broaden their lineups, sharing hybrid or battery technology to create more options, or collaborating with onboard software and intelligence to create advanced driver and passenger interfaces in their vehicles.
If these talks lead to a merger, it could be quite a large one, rivaling the recent merger of Fiat Chrysler Automobiles and Group PSA (Peugeot, Citroen, Opel, Vauxhaul) in 2021 which was renamed into Stellantis .
However, there are a few things standing in the way of a possible merger. For one, Nissan is part of the Renault-Nissan-Mitsubishi Alliance formed in 2017. Some experts say Nissan may eventually bring Mitsubishi into any potential partnership. Nissan, after all, is Mitsubishi's biggest shareholder. However, the sentiment doesn’t seem to be the same for their other partner, Renault.
For now, this is all speculation, but it’s certainly one worth watching as Honda and Nissan are both large carmakers in Japan and Southeast Asia.