Auto expert Mike Caudill joins ‘Cavuto: Coast to Coast’ to discuss the likelihood of a merger between Honda and Nissan and how it could impact the brands.
Japanese automakers Nissan and Honda agreed to consider a merger and set up a joint holding company, which would create the world’s third-largest automaker.
The two companies said in a statement Monday that they would seek combined sales of $191 billion and an operating profit of more than $19 billion through the potential merger.
The companies hope to wrap up negotiations around June 2025 and set up a holding company by August 2026, when both companies’ shares will be delisted.
The merger talks come as both automakers struggle to compete with the largest global electric vehicle makers, including Tesla and Chinese automaker BYD.
WHAT A HONDA-NISSAN MERGER COULD MEAN FOR THE AUTO INDUSTRY AND CONSUMERS
Makoto Uchida (left), Director, Representative Executive Officer, President and CEO of Nissan Motor Corporation and Toshihiro Mibe (right), Director, President and Representative Executive Officer of Honda, hold a joint news conference on their merge (Reuters / Reuters Photos)
The merger would create the world’s third-largest auto group by vehicle sales, behind Toyota and Volkswagen.
Honda, the second-biggest Japanese automaker behind Toyota, has a market capitalization of more than $40 billion, while third-ranked Nissan is valued at about $10 billion.
“Today marks a pivotal moment as we begin discussions on business integration that has the potential to shape our future,” Nissan Director, President, CEO and Representative Executive Officer Makoto Uchida said in a statement. “If realized, I believe that by uniting the strengths of both companies, we can deliver unparalleled value to customers worldwide who appreciate our respective brands. Together, we can create a unique way for them to enjoy cars that neither company could achieve alone.”
The Honda-Nissan merger would create the world’s third-largest auto group by vehicle sales. (Reuters / Reuters Photos)
Honda Director and Representative Executive Officer Toshihiro Mibe said: “Creation of new mobility value by bringing together the resources including knowledge, talents, and technologies that Honda and Nissan have been developing over the long years is essential to overcome challenging environmental shifts that the auto industry is facing.
“Honda and Nissan are two companies with distinctive strengths,” Mibe added. “We are still at the stage of starting our review, and we have not decided on a business integration yet, but in order to find a direction for the possibility of business integration by the end of January 2025, we strive to be the one and only leading company that creates new mobility value through chemical reaction that can only be driven through synthesis of the two teams.”
HONDA, NISSAN ALLEGEDLY PLANNING TO START MERGER TALKS IN LIGHT OF EV COMPETITION: REPORT
Honda and Nissan also agreed to widen the collaboration to Mitsubishi Motors. (Reuters / Reuters Photos)
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The majority of the holding company’s board will be appointed by Honda.
The companies have been exploring ways to bolster their partnership, including saying in March that they were considering partnering on electrification and vehicle intelligence and announcing in August an agreement to carry out joint research into fundamental technologies in the area of platforms for next-generation software-defined vehicles.
They also agreed to widen the collaboration to Mitsubishi Motors.
Reuters contributed to this report.
