After PSA and Fiat, it's Honda and Nissan's turn to merge to become a giant

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Nissan The automotive world is experiencing a time of major mergers and consolidation. With rising costs, particularly due to electric cars, and current marketing challenges, manufacturers are looking to consolidate to continue to grow.

A few years ago, the creation of Stellantis, a holding company that owns Fiat, Peugeot, Citroën, Chrysler and Jeep, caused a lot of talk. The grouping of this group of manufacturers made Stellantis the world's leading seller of electric cars.

Stellantis, Japanese version

A project that seems to have given ideas on the other side of the planet, with the future creation of a Japanese holding company bringing together the Honda, Nissan and Mitsubishi brands. In a joint press release issued this week, the two major companies Nissan and Honda (Mitsubishi being a subsidiary of the Nissan group) have publicly revealed their intention to merge in the coming months.

While the two CEOs have assured that the discussions are “only just beginning”, they hope to find a preliminary agreement very quickly, by the end of January. The merger should be finalized next June, with the creation of a holding company that owns both brands.

Renault has its card to play

While this merger between two Japanese companies seems far from our concerns, it is nevertheless France that would have the keys to this affair. Indeed, Renault still holds 15% of Nissan's shares, which gives it a voice on the company's board of directors.

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However, it is the company's board of directors that will have to validate, or not, the merger between Nissan and Honda in a few months. So it is the French company that will pull the strings in this affair, thousands of kilometers from Tokyo. It will be interesting to see what position the diamond brand will adopt in the face of a former ally and a direct competitor.

A merger for the electric industry ?

This was one of the burning questions surrounding this merger project, the future of the electric car. Honda is one of the most advanced brands in the world on this subject and it could share its experience and know-how with Nissan.

For its part, the brand has a very strong customer base in Europe and the United States, two regions where electric cars are still selling very well. In their joint press release, Honda and Nissan assure that everything will be put in place to facilitate the development of the electric car. The R&D teams should be grouped together in a single pole, facilitating the work of the two companies.

Nissan: a financial obligation

While Nissan is probably much better known than Honda in Europe, the Japanese brand is not in better health. Nissan is even going through a very difficult period, with accounts in the red for months. The company will also have to undergo a financial audit before the merger.

Honda, for its part, has stable finances, but a much smaller customer base in the West. By joining forces, the two companies hope to benefit from the strengths of their new collaborator.

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