On December 23, car manufacturers Honda and Nissan announced their intention to explore the possibility of merging and creating a joint holding company. This decision can turn them into the third largest automobile concern in the world.
About this informs Reuters.
In a joint statement, the companies said they plan to achieve total sales of 30 trillion yen (US$191 billion) and operating profit of more than 3 trillion yen as a result of the potential merger. Negotiations should be completed by June 2025, and the launch of the holding company is planned for August 2026. After that, Honda and Nissan shares will be delisted.
The consolidation will allow the combined company to become the third largest car seller in the world, behind only Toyota and Volkswagen. The move reflects challenges facing traditional manufacturers, particularly from Tesla and Chinese rivals.
Honda, Japan’s second-largest automaker after Toyota, has a market capitalization of more than $40 billion, while Nissan is valued at $10 billion. Honda will receive the majority of seats on the board of directors of the new holding company.
The merger of these two iconic Japanese brands could be the biggest event in the automotive industry since the 2021 merger of Fiat Chrysler Automobiles and PSA, which created the $52 billion Stellantis group.
