Nissan to bow out of historic tie-up with Honda, Nikkei reports

The pair had been negotiating the terms of a tie-up under which Honda would absorb Nissan, bringing the two brands under a single holding company in 2026

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Nissan Motors’ Chief Executive Makoto Uchida (left),Takao Kato, CEO of Mitsubishi Motors (center), and Honda Chief Executive Toshihiro Mibe (right), leave after a joint news conference in Tokyo on December 23, 2024. Photo: AP

Published: 3:58pm, 5 Feb 2025

Nissan Motor is pulling out of its deal with Honda Motor to combine both brands and regain global competitiveness, the Nikkei newspaper reported Wednesday.

The pair had been negotiating the terms of a tie-up under which Honda would offer Nissan a lifeline by absorbing its struggling rival, and bring the two brands under a single holding company in 2026.

The two competitors failed to reach a consensus after seven short but tumultuous weeks of talks, according to the newspaper, which cited people it did not identify, bringing to a swift end what could have been a historic partnership for Japan’s auto industry.

The Tokyo Stock Exchange suspended trading of Nissan’s shares in response to the report. Honda’s shares rose as much as 12 per cent, while Nissan fell as much as 6.4 per cent.

Spokespeople for both companies said the report wasn’t based on announcements from either, and that a framework for ongoing negotiations will be announced as planned, albeit delayed once already, in mid-February. Friction emerged between the two this week after media reports said Honda floated the idea of a complete acquisition, a proposal that was met with strong opposition within Nissan.

From the moment initial reports of a so-called merger surfaced in December, it was clear that Honda, with more than quadruple the market value, had the upper hand. When the two announced the deal in December, Honda made it apparent that Nissan had to implement a restructuring plan in order for any transaction to materialise.