An analyst believes a merger between Nissan and Honda is not beyond the realms of possibility, Bloomberg reports.
According to LightStream Research analyst Mio Kato, the reported ‘fractured’ relationship between Nissan and Renault (even if the two companies claim otherwise publicly) could encourage the Japanese automaker to seek out a new partnership that would allow it to rival Toyota. It could make that happen if it were to join forces with Honda.
Related: Nissan Accelerating Secret Plan To Split From Renault?
“Honda has never been one to engage in aggressive M&A and a merger between Honda and Nissan should be unthinkable, but with Toyota’s increasing competitiveness we feel that if Nissan desired an alliance partner to replace Renault, Honda may not be entirely against the idea,” Kato said.
Neither Honda nor Nissan have responded to the report but recently, Nissan denied claims that it is thinking about ending its alliance with Renault following the recent escape of former chairman Carlos Ghosn from Japan.
Kato believes that as car manufacturers look to establish strong partnerships in the coming years, the Japanese car industry could be split into two giant groups, one of which would be Toyota which already has stakes in Mazda, Suzuki, and Subaru.
If Nissan were to ditch Renault in favor of Honda, the new group’s annual sales could rise from just under 11 million units a year to roughly 12 million units annually.
“Nissan does have attractive possibilities to dangle in front of potential suitors and Toyota’s relentless march forward could necessitate drastic change for those on the outside in Japan,” he wrote.
