Forward Merger Honda And Nissan, Canceled?

Nissan and Honda signed the MOU to consider business integration/(Photo: Nissan Global)

JAKARTA - Bad news came from two well-known producers from Japan, namely Honda and Nissan, who initially planned to merge, now according to Nissan Motor Co's latest report, will cancel the conversation.

Based on a report from Kyodonews, quoted on Thursday, February 6, according to a source familiar with the matter, it was said that Nissan rejected Honda's proposal to make him a subsidiary.

Previously, the two companies in December started talks on mergers under parent companies in 2026 while maintaining their respective brands, with the aim of reducing costs and a growing variety of financial expenses, particularly in the development of electric vehicles and software.

However, Honda, which has a larger volume of market sales and capitalization, recently stated Nissan's struggle to become its subsidiary, which has sparked strong opposition within Nissan, according to sources familiar with the matter.

"The discussion of the merger took place amid the restructuring of Nissan, where Honda is trying to control the company because of concerns that Nissan's failure to make changes could have an impact on its own future," the source said.

The source also said that Nissan was worried that being a Honda subsidiary would greatly weaken its autonomy. Previously, Nissan CEO Makoto Uchida stressed that no company would have the advantage in the merger, stressing that they would have equal standings.

"Nissan's restructuring plan has failed to convince Honda that the struggling car manufacturer is on track to achieve a successful course change, a major premise agreed by the two companies for the merger plan," according to the source.

Whereas Nissan has recently done various ways to overcome the difficult situation, the way is by cutting 9,000 jobs worldwide and reducing global production capacity by 20 percent, although they did not provide details of the plan. Not only that, but Nissan also offered an early retirement program to employees at three of its factories in the US and reduced its workforce in Thailand as part of the reform plan.

"However, Honda has demanded more thorough reshuffle measures, saying that further downsizing is needed to continue its planned merger," according to the source.

As previously reported, Nissan and Honda will officially announce the results of the merger decision in mid-February.