Honda-Nissan $60B Merger Officially Dead Over Control Issues, Mitsubishi Out Too

The ambitious $60 billion merger between Honda and Nissan, aimed at creating one of the world’s largest automakers, has officially been scrapped. In an official announcement today, the companies have also put an end to their discussions about a potential three-way collaboration with Mitsubishi. However, they haven’t completely shut the door on future partnerships, especially when it comes to “intelligent and electrified automobiles.” So, while the merger is off, the dance isn’t over yet.

The Collapse of the Merger

Both companies released similar statements, confirming reports that had surfaced earlier. According to Honda, they explored all options for business integration but had different visions for how it should look. Specifically, Honda had ambitions to become the parent company, which is widely seen as the main sticking point behind the cancellation of their December 23 Memorandum of Understanding (MOU).

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In its statement, Nissan explained that Honda had proposed a shift in the deal’s structure. Initially, they discussed forming a joint holding company where each party would have equal say. But Honda wanted to change that, proposing instead a setup where it would become the parent company and Nissan would be the subsidiary. As you can imagine, Nissan wasn’t exactly thrilled about that power dynamic.

The Road Ahead

As reported last week, Nissan didn’t agree to this structure, and is now looking for other partners – including one with tech manufacturing giant Foxconn. In its conclusion, Nissan said the decision to end talks would allow both companies to “prioritize speed of decision-making” and adapt to the rapidly changing automotive landscape, especially as the industry moves toward electrification. In other words, they want to make sure they can pivot quickly and don’t get bogged down in corporate power struggles.

Still Collaborating on Electrification

This outcome, according to the announcement, will allow the automakers to “prioritize speed of decision-making and the implementation of management policies amid the rapidly changing market environment as we move toward the era of electrification.”

In a separate update, Honda, Nissan, and Mitsubishi confirmed that their talks about a three-way collaboration have also come to an end.

However, the three automakers will continue collaborating “within the framework of a strategic partnership focused on the era of intelligent and electrified vehicles.” They will still join forces on electrification and software development as part of a broader effort to stay competitive in the EV race, particularly against Chinese rivals. This alliance is also outlined in a Memorandum of Understanding signed on August 1.