Honda, Nissan and Mitsubishi are talking about fusion

The Japanese manufacturers Honda and Nissan plumb one merger which would create the world’s third largest car company in terms of sales after Toyota and Volkswagen. The companies said on Monday they were exploring a merger and the creation of a joint venture. The smaller manufacturer Mitsubishi in which Nissan is a major shareholder, is also considering joining.

It would be the worldwide biggest deal in the industry since the $52 billion (50.05 billion euros) merger between Fiat Chrysler and PSA in 2021, from which Stellar emerged. The CEOs of the three Japanese companies presented their plans at a joint press conference in Tokyo.

Car manufacturer stocks immediately rise

The stock exchange reacted quickly after more and more details about the merger proposal became known. Honda shares ended the trading day in Tokyo with a gain of 3.8 percent, Nissan shares rose by 1.6 percent. Mitsubishi shares climbed 5.3 percent. The Nikkei Index closed with a plus of 1.2 percent.

“The Rise of Chinese automakers and new players have significantly changed the automotive industry,” said Honda boss Toshihiro Mibe. “We need to build capabilities by 2030 to to fight with them, Otherwise we will be beaten.” Honda and Nissan together are aiming for sales of the equivalent of $191 billion and an operating profit of the equivalent of $19.2 billion.

They want to complete their merger talks in June 2025 and then by August A holding company in 2026 put on your feet. According to an insider, the new company will be listed on the stock exchange at that time. Together with Mitsubishi, the new group would have global car sales of more than eight million vehicles.

Different forms of integration in conversation

Insiders had already reported on Sunday that both companies were planning board meetings for Monday at which various forms of integration would be discussed, including Delivery of hybrid vehicles from Honda to Nissan and the sharing Nissan’s car factory in Great Britain. It was also said that a collaboration with Mitsubishi Motors, in which Nissan is the largest shareholder with a 24 percent stake, was being examined.

Honda is Japan’s second largest automobile company after Toyota and currently has a market value of more than $40 billion. Nissan, number three in Japan, is worth around $10 billion on the stock market. The French car manufacturer and major shareholder of Nissan Renault according to insiders basically open for merger talks between the companies.

New manufacturers added Honda and Nissan

With the merger, both companies are reacting to this increasing competition by new manufacturers such as Tesla and Chinese corporations. Honda and Nissan have also lost ground in the world’s largest car market, China, due to the rise of Chinese manufacturer BYD and other companies producing electric and hybrid cars with innovative software. The People’s Republic almost made it in November 70 percent of global electric vehicle sales with more than 1.27 million units in the month.

It has been known for a long time that Honda and Nissan want to work more closely together. Both companies announced in March that they would have one Cooperation on e-cars and software development consider. They agreed on joint research activities and expanded the collaboration to Mitsubishi in August. Nissan is currently battling shrinking car sales in the key markets of China and the USA. Last month the group announced plans to cut 9,000 jobs. The worldwide ones Production capacities should reduced by 20 percent become. Honda also recently reported profit figures that were worse than expected due to declining sales in China.