Red Star Capital Bureau reported on December 18th that Honda and Nissan are discussing a business merger today. If it can be achieved, it is expected to become the world's third-largest automotive group.
On December 18th, it was reported that Honda and Nissan, two Japanese car companies, began negotiations on business integration. The two sides will establish a holding company and soon sign a memorandum of understanding, under which both Nissan and Honda will be included. Meanwhile, as Nissan holds 24% of Mitsubishi Motors' shares and is the largest shareholder of Mitsubishi Motors, Mitsubishi Motors may join this holding company in the future. After the merger, the annual sales scale of the three companies will reach 8 million vehicles, becoming the world's third-largest automotive group.
According to a report by First Financial, Honda China and Nissan China responded that the above news was not released by the two companies. Honda, Nissan, and Mitsubishi are indeed discussing various possibilities for future cooperation, but no decision has been made yet. Honda's Executive Vice President Maki Aoyama responded to the news of "Honda and Nissan discussing merger" by stating that Honda is considering several options, including merger, capital cooperation, or establishing a holding company.
Affected by the merger news, the stock prices of Honda, Nissan, and Mitsubishi Motors skyrocketed on Wednesday of this week. Among them, Nissan's early gains exceeded 20%, Mitsubishi's gains expanded to 20%, hitting the daily limit up, while Honda's stock price fell by 3.4% at one point.
According to public information, in March of this year, Nissan and Honda signed a memorandum of understanding to fully cooperate in the electric vehicle business, including joint procurement, joint development of power platforms, and universalization of spare parts. The two sides plan to achieve cost reduction and enhance the competitiveness of electric vehicle products through resource integration.
In July, Mitsubishi Motors joined the Honda Nissan alliance, and the three companies plan to standardize the in car software that controls cars. They will be the first to apply standardized in car software technology to Mitsubishi Motors and explore the possibility of complementary vehicle models.
In November, Mitsubishi Motors and Nissan reached a consensus to establish a joint venture company to provide services related to autonomous driving and the use of electric vehicle batteries as batteries. The new company will be established in March 2025 and will be owned equally by two companies.
Honda and Nissan are the second and third largest car manufacturers in Japan after Toyota, but both have faced severe challenges in terms of market share and operating conditions this year. According to the sales data of the China Association of Automobile Manufacturers in November, Honda's terminal car sales in China were 76773 units, a year-on-year decrease of 28.02%. Nissan's sales in China, including passenger cars and light commercial vehicles, were 63545 units, a year-on-year decrease of 15.14%.
According to Honda's latest financial report, the operating profit for the first half of the 2024 fiscal year (April to September this year) increased to 742.6 billion yen, a year-on-year growth of 6.6%; Net profit was 494.6 billion yen, a year-on-year decrease of 19.7%. According to Nissan's latest financial report, the operating profit for the first half of the 2024 fiscal year (April to September this year) was 32.908 billion yen, a significant decrease of 90.2%; Net profit was 19.223 billion yen, a year-on-year decrease of 93.5%.