Honda $7267 (-1,07 %) and Nissan $7201 (-0,7 %) have formalized plans to merge under a joint holding company, aiming to become the world's third-largest automaker. Mitsubishi Motors, 24.5% owned by Nissan, is expected to join, with a final decision due by January.
Key Details:
Timeline: New entity to list by August 2026.
Leadership: Honda to nominate a majority of directors.
Scale: The merger could rival Toyota and challenge Chinese EV giants like BYD.
Honda also announced a $7B share buyback, repurchasing nearly 24% of its stock. CEO Toshihiro Mibe expects ¥1T+ in annual synergy gains, scaling to ¥3T over time.
This partnership responds to fierce EV competition and declining sales in key markets like China. While Honda is in strong shape, the deal provides much-needed relief for Nissan, which has struggled with outdated product offerings and plummeting profits.