Nissan and Honda Abandon Plans to Merge into Single Automaker

In a surprising turn of events, Nissan and Honda have officially cancelled their plans to merge into a single automaker, just two months after they confirmed their intentions to join forces. The decision was made after the companies terminated their memorandum of understanding (MOU) signed in December 2024.

Background and Decision

The planned merger would have resulted in a massive entity with a net worth of approximately $50 billion, had it gone through. The companies stated that their CEOs and management teams had discussed the objectives and structures they envisioned for the merged entity. Honda had proposed various options, including establishing a joint holding company or having Honda as the parent company with Nissan as a subsidiary.

Honda’s "Take It or Leave It" Offer

The Financial Times reported earlier this month that Honda presented the structure that would make Nissan its subsidiary as a "take it or leave it" offer. However, a majority of Nissan’s board members reportedly rejected the deal during a meeting in early February. Despite this, Nissan chose to wait until mid-February to make a formal announcement about the merger.

Reasons for Cancellation

The companies cited the need to prioritize speed of decision-making and execution of management measures in an increasingly volatile market environment heading into the era of electrification. They also stated that they still have plans to collaborate within the framework of a strategic partnership aimed at the era of intelligence and electrified vehicles.

Continued Collaboration

Although the merger plans have been cancelled, Nissan and Honda have expressed their commitment to working together. The two companies will continue to explore opportunities for collaboration, focusing on the shared goal of advancing the automotive industry in the face of technological change.