Honda and Nissan signed an MoU to merge and form a joint holding company in Tokyo, focusing on AI and electrification technologies.
The partnership aims to enhance competitiveness globally, targeting over ¥30 trillion in revenue and a Tokyo Stock Exchange listing by 2026.
By Fayza Nawra Avanitanya, Muthia Noor Safitri, Kenzie Aryasatya, Imam Fakhri Prayogo Harianto
December 27, 2024 at 16:30 GMT+7
Honda and Nissan have officially announced their merger, aiming to create the world's third-largest automotive group by 2026. On December 23, 2024, Makoto Uchida, President and CEO of Nissan, and Toshihiro Mibe, CEO of Honda, held a joint press conference in Tokyo to discuss their merger.
This partnership was first formalized four months earlier, on August 1, 2024, with the signing of a Memorandum of Understanding (MoU). The two automakers are establishing a joint holding company in Tokyo, Japan, as part of the merger agreement.
The collaboration aims to combine intelligence and resources, achieve economies of scale, and unlock synergies while maintaining the distinct identities of both brands. Moreover, the merger focuses on advancing technologies in artificial intelligence and electrification, essential for long-term vehicle production.
CEO of Nissan, Makoto Uchida, and CEO of Honda, Toshihiro Mibe | Source: Honda
As the automotive industry continues to shift towards advanced technologies, Honda and Nissan are dedicating their focus to researching SDVs (Software-Defined Vehicles). Between the two, there’s a mutual agreement to enhance competitiveness in delivering ICE, HEV, PHEV, and EV models globally.
Additionally, the collaboration aims to contribute to Japan’s industrial base by expanding their businesses from four-wheel to two-wheel vehicles, further strengthening their market position. These goals stem from the challenges both companies are facing due to sales slump, which has led to financial struggles and the need for strategic adjustments in response to declining performance in their operations.
"The rise of Chinese automakers and new players has changed the car industry quite a lot," said Honda CEO, Toshihiro Mibe, stressing the importance of advancing in electrification and autonomous driving. "We have to build up capabilities to fight with them by 2030, otherwise, we'll be beaten."
Nissan & Honda EVs | Source: Autoweek
The merger is expected to generate a combined revenue of over ¥30 trillion and an operating profit of more than ¥3 trillion. For the fiscal year ending in March 2024, Honda reported an operating profit of ¥1.382 trillion, while Nissan recorded ¥568.7 billion.
Final decisions regarding the merger are expected by June 2025, with plans to list the joint\holding company on the Tokyo Stock Exchange in August 2026. Honda's shares rose by 3.8% and Nissan's by 1.6% following the announcement of the merger plan.
“Today marks a pivotal moment,” Nissan CEO, Makoto Uchida, said in a statement regarding the merger, “Together, we can create a unique way for customers to enjoy cars that neither company could achieve alone.”
Sources:
CNN
CNBC
Reuters
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