With Nissan sales struggling, a merger with Honda could provide the financial relief needed to keep Nissan afloat, but Honda CEO and analysists seem sceptical.
I bet you didn’t see that one coming. I certainly didn’t. It’s no secret that Nissan’s shift to electric vehicles has been difficult. While in the early days of electric cars the Nissan Leaf was heralded as the future, today it feels outdated, and the technology has lacked behind other brands that have made great strides into this new electric world. And while Nissan’s latest creation, the Ariya, has brought the game forward, it hasn’t been the game-changer it had hoped, with sales failing to gain the traction expected.
On the other hand, Honda’s market position has remained relatively strong throughout the same period. It’s slower approach to the move to all-electric has meant a larger selection of not only hybrid models, but also strictly combustion-engined, and also retaining it’s position in the hot-hatch sector. So what’s the benefit for Honda? Its CEO, Toshiro Mibe, had the same feeling when asked that question: “That’s a difficult one”.
Thinking bigger picture, this merger could protect the Japanese auto industry from foreign ownership, something Japan’s Ministry of Economy, Trade and Industry (METI) has encouraged against. The government body wants to ensure Nissan remains under Japanese control, with Taiwan’s Foxconn (it makes Apple iPhones) interested in buying Nissan.
We asked AI to create an image of a sports car built by Honda and Nissan, this is what it created. To be honest, if either built that, I think we’d all be happy!
How could a Nissan and Honda merger benefit both brands?
With Nissan’s focus fully on producing electric vehicles, it’s EV building infrastructure is ahead of Honda’s, who has primarily focused on hybrid vehicles. In other words, Honda can make use of Nissan’s EV building infractusture and technologies, meanwhile Honda can share its hybrid technology with Nissan to produce hybrid vehicles which in turn could improve sales. Elsewhere, the merger would see a whole host of operations being shared between the brands, from procurement to human resources and more.
To add further complications to the discussions, Mitsubishi is also being rumoured to join in the merger, with Nissan owning 34% of the company. A conglomerate of Japanese automakers that were once leaders in their fields across the world sounds like an almighty alliance that could help put Mitsubishi back on the map.
Time will tell. But ultimately what this does tell us is that those who rushed into the EV market have been left with the bitter end of the deal, clinging on to a future that may not exist.
If you want to see cars from the golden eras of Nissan and Honda then you’ll want to visit our Japfest Silverstone event. It’s the biggest Japanese car show in Europe, attracting almost 30,000 people in 2024. Head over to the Japfest page here for more information.
