New Delhi: Honda Motor Co. is reported to have lost 100,000 shares and Nissan Motor Co. is considering a merger that would reshape Japan’s auto industry and create one of the world’s largest automakers, challenging Toyota Motor Co.’s merger authority, according to Bloomberg. Sources close to the matter said it was in preliminary discussions and could include options for a merger, tying up for capital, or setting up a holding company.
Honda Executive Vice President Shinji Aoyama confirmed Wednesday that the company is exploring options, including a possible merger, following various reports. The news sent Nissan shares up 24% in early trading Wednesday, but Honda shares fell 3.4%, according to a Bloomberg report.
Residents, who asked not to be named, say one of the ideas being discussed is to form a new holding company, which would manage the combined business. The deal could grow into Mitsubishi Motors Corp., the sources said. in addition to Nissan’s already extensive relationships. The report stressed that the talks are still at an early stage and may not lead to a deal.
If a deal goes through, the Japanese automotive industry will combine two powerful groups: one led by Honda, Nissan, and Mitsubishi, the other driven by Toyota and its partners This merger could force the combined company intensity of global competition, especially from electric vehicle (EV) manufacturers such as Tesla Inc . and Chinese automakers in the face of challenges The report added.
This follows a recent collaboration between Honda and Nissan on EV batteries and software. Earlier this year, Honda Chief Executive Officer Toshihiro Mibe said a capital relationship with Nissan was possible as matters got deeper into the kernel following on the heels of recent cooperation between Honda and Nissan over EV batteries and software. Earlier this year, Honda’s chief executive, Toshihiro Mibe, said a capital tie-up with Nissan is possible as things move deeper into collaboration.
Honda, Nissan, and Mitsubishi together sold about 4 million vehicles worldwide in the first half of the year as Toyota’s sales went beyond 5.2 million units. Merging the efforts of the three will possibly help them take down Toyota from this position. The three auto manufacturers have already fortified their network as they take stakes in Subaru Corp, Suzuki Motor Corp, and Mazda Motor Corp. End.
