Japanese carmakers Nissan and Honda have decided to call off merger talks

As expected, Honda and Nissan are drawing a line under their merger talks. The negotiations, which began in December, will come to an end, the companies announced in Tokyo on Thursday. Instead, the companies want to work together with Mitsubishi Motors in the strategic partnership planned since August last year, which is aimed at the digitalization and electrification of vehicles. It had become increasingly clear in recent weeks that nothing would come of the merger, as several media outlets had reported.

The Japanese car manufacturers had hoped that together they would be better able to defend themselves against the weakening business in China and the growing competition in the growing electric car market. Japanese car manufacturers have fallen behind globally in this area. Tesla and the Chinese manufacturer BYD are putting pressure on the Japanese in the USA and China. Nissan is struggling in the Chinese market in particular, where sales have fallen significantly.

One of the topics of discussion was that Nissan could slip under Honda’s umbrella as part of a joint venture – but this failed. The groups had decided to focus on faster decision-making and implementation processes in the rapidly changing market, the statement said. Honda and Nissan are Japan’s second and third largest carmakers after Toyota.