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Nissan, Honda and Mitsubishi Motors have terminated their December MoU, but agreed to keep collaborating on tech and software.
The big merger of Nissan and Honda – which recently hit difficulties – now appears to be formally over.
Nissan, Honda and Mitsubishi Motors (MMC) have agreed to terminate their MoU regarding the consideration of the structure for a tripartite collaboration, in light of the termination of the MoU (Memorandum of Understanding) signed on December 23 last year regarding the consideration of a business integration between Nissan and Honda.
Nissan and Honda announced in December they planned to begin “discussions and considerations” towards fully integrating their automotive businesses under a new joint holding company. MMC was signed up to potentially join the new entity.
However, earlier this month it appeared that initial discussions had not gone smoothly when Nissan and Honda delayed plans to unveil further details about their planned merger until mid-February or later, revising the previous scheduled announcement of the end of January. MMC then appeared to back off on potentially joining the consolidation and reports emerged that Nissan was ready to pull out of the merger plan altogether.
The apparent breakdown in merger talks between Honda and Nissan also appeared to open the door for Foxconn to further its automotive ambitions via Nissan, perhaps via a stake.
Japanese automakers have fallen behind the Chinese and also Tesla in making the transition to zero emission vehicles and are coming under increasing pressure to make up lost ground. Analysts say the strategic landscape is particularly fluid and dynamic as they consider future options.
“Nissan has put in place a significant cost-cutting strategy across its global operations, but operational overlaps and duplication with Honda - in terms of manufacturing footprints and market presence – were bound to make the full merger discussions difficult,” says GlobalData analyst Justin Cox.
Future collaboration on a more limited basis
Going forward, the three companies say they will collaborate within the framework of a strategic partnership aimed at the ‘era of intelligence and electrified vehicles’. This framework was established with an MoU signed on August 1 last year, ‘striving to create new value and maximise the corporate value of each company’.
Mitsubishi joins Japanese automaker collaboration (the August 1 2024 MoU)
"Nissan and Honda merger talks formally off" was originally created and published by Just Auto, a GlobalData owned brand.