Honda, Nissan Terminate Merger Talks Amidst Market Volatility
Tokyo, Jan. 11 (Reuters) - Japanese auto giants Honda and Nissan have officially called off their merger discussions, announced in December. The termination ends a potential alliance that aimed to create the world's third-largest automaker.
In a joint statement, the companies acknowledged their agreement to terminate the December MOU (memorandum of understanding) exploring business integration. The move was driven by the need for "speed of decision-making" and execution in a rapidly changing market, particularly in the era of electrification."
Earlier talks had focused on establishing a joint holding company. However, Honda later proposed a different structure, with Honda as the parent company and Nissan as a subsidiary through a share exchange.
Despite the termination, both Honda and Nissan emphasized that it would not impact their earnings. They also reaffirmed their commitment to ongoing collaboration on electric vehicles and smart car technologies, including autonomous driving features.
The proposed merger, valued at over $50 billion, had initially garnered attention as a strategy to compete with Tesla and Chinese EV companies. Mitsubishi Motors Corp. had also expressed interest in joining the alliance.
With the termination of merger talks, the three automakers will continue their respective efforts in the electric vehicle market while maintaining their existing partnerships and collaborations.