Honda and Nissan to Merge by August 2026 in Landmark Deal.

Japanese auto giants Honda Motor Company, Nissan Motor, and Mitsubishi Motors Corporation have announced plans to merge, aiming to create one of the world’s largest automotive groups. The proposed alliance would establish a holding company projected to rank as the third-largest globally, rivaling industry leaders such as Tesla and China’s electric vehicle (EV) manufacturers.

The companies reached a preliminary agreement based on a memorandum of understanding signed by Honda and Nissan on August 1, with Mitsubishi Motors joining the discussions. The partnership will prioritize advancements in intelligence and electrification, setting the stage for a transformative collaboration.

To facilitate the merger, the companies will form an integration preparatory committee tasked with identifying synergies, conducting due diligence, and developing a comprehensive strategy for smooth integration. A definitive agreement is expected by June 2025, with the merger planned for completion by August 2026. Mitsubishi Motors aims to finalize its level of participation by January 2025.

The merged entity is projected to generate sales revenue exceeding ¥30 trillion and an operating profit surpassing ¥3 trillion annually. By optimizing manufacturing plants, sharing production lines, and enhancing energy service facilities, the alliance expects to improve capacity utilization and reduce fixed costs significantly.

The combined group could produce approximately 8 million vehicles annually, approaching Toyota Motor Corporation’s 2023 output of 11.5 million vehicles. In 2023, Honda produced 4 million vehicles, Nissan manufactured 3.4 million, and Mitsubishi over 1 million.

“The integration will create significant synergies in a wide range of fields,” said Makoto Uchida, President and CEO of Nissan. “It is significant that Mitsubishi Motors is also participating in these discussions.”

Industry analysts estimate the merger could result in a conglomerate valued at over $50 billion, giving the Honda-Nissan-Mitsubishi alliance the scale needed to compete with automotive giants like Toyota and Germany’s Volkswagen Group.

“This collaboration positions us to redefine the future of mobility while achieving operational and financial excellence,” said Toshihiro Mibe, Director and Executive Officer at Honda.

HBL