Nissan may call off its merger discussions with Honda according to a Reuters report. The Japanese car giants have faced growing disagreements over leadership and strategic direction, putting the proposed merger at risk.
As per Reuters, Nissan’s board is set to meet soon to evaluate whether to continue or break off negotiations. One key issue appears to be Honda’s suggestion that Nissan could become its subsidiary, contradicting the initial vision of a “merger of equals.”
With Nissan struggling to cut 20% of its global production and downsize 9,000 employees, Honda—valued nearly five times higher—has concerns about its potential partner’s turnaround strategy.
Christopher Richter, senior Japan autos analyst at CLSA, noted that control appears to be a sticking point. He stated, “The news that Nissan did not want to be a Honda subsidiary suggests that control was a contentious issue. Without control, Honda appears to be walking away.”
Both Nissan and Honda have declined to comment on the status of negotiations but confirmed an announcement is expected by mid-February.
If the merger collapses, Nissan will need to explore alternative strategies to remain competitive in the rapidly evolving EV and autonomous vehicle market.
