Nissan and Honda claim to be exploring “future collaboration” – Observer

Nissan and Honda indicated on Wednesday that they are “exploring various possibilities for future collaboration”, after the Japanese press reported on talks between the automakers for a possible merger.

“As announced in March this year, Honda and Nissan are exploring several possibilities for future collaboration, building on each other’s strengths,” the two companies said.

In March, the manufacturers announced that they began negotiating an alliance to produce components and programs for electric vehiclesin an attempt to reduce costs and strengthen competitiveness.

“If there are any updates, we will inform interested parties in a timely manner,” Honda and Nissan said in a joint statement.

This morning (local time), the Tokyo Stock Exchange announced it had temporarily suspended trading in Nissan, saying it needed to “check the ‘media’ reports” about a possible merger with Honda.

Trading in Nissan shares resumed in the meantime and at 1:30 pm (3:30 am in Lisbon) they rose 23.7%, while Honda shares fell 3.1%.

Japanese economic newspaper Nikkei and Japanese news agency Kyodo said the two companies were preparing to start negotiations to create the world’s third-largest car maker by sales volume, behind Toyota and Volkswagen.

Nissan and Honda are considering combining their assets into a joint company, and each company’s stake will be decided later, Nikkei said.

The objective is to face competition from Chinese and North American electric vehicle manufacturers, such as Teslaadded the economic newspaper.

Japan’s two automakers face declining sales in China, where local brands with more affordable electric vehicles are gaining market share.

Nikkei reported that Honda intends to soon sign a memorandum of understanding with Nissan with details of the operation, which could also include Mitsubishi, whose main shareholder is Nissan.

In August, Mitsubishi, of which Nissan owns 34%, joined talks to be part of the alliance to produce components and programs for electric vehicles.

In the same month, Honda’s president, Toshihiro Mibe, said that the negotiations did not involve a shareholder merger, although he did not deny such a possibility in the future.

If completed, the merger will leave the Japanese car market divided into two large blocksone formed by Nissan and Honda and the other by Toyota.