Honda-Nissan merger officially over – Nissan didn’t want to be a subsidiary of Honda; Mitsubishi also out

It’s now official. In a joint press release issued today, Honda and Nissan announced that the memorandum of understanding (MoU) to explore the possibility of a merger (worded as “business integration”) has been officially terminated. This comes just under two months after both carmakers signed the MoU on December 23 last year.

Prior to the latest development, the plan was for a committee to study how best to implement a merger, with a definitive agreement due to be reached by June 2025. Following this, shareholders would have needed to approve the deal in April 2026, after which both automakers will be delisted from the Tokyo Stock Exchange (TSE) sometime around July-August 2026.

A newly established joint holding company will then then be listed on the TSE by August next year, with both Honda and Nissan becoming wholly owned subsidiaries.

However, discussions between the two companies following the MoU signing saw Honda propose a change in structure. Rather than establishing a joint holding company, where Honda would appoint the majority of directors and the CEO based on a joint share transfer as initially outlined, it was proposed that Honda would be the parent company and Nissan the subsidiary through a share exchange.

“As a result of these discussions, both companies concluded that, to prioritise speed of decision-making and execution of management measures in an increasingly volatile market environment heading into the era of electrification, it would be most appropriate to cease discussions and terminate the MoU,” read the release.

Despite a merger not happening, both parties say they “will collaborate within the framework of a strategic partnership aimed at the era of intelligence and electrified vehicles” This is in regards to previous MoUs focusing on joint research to be carried out in vehicle intelligence and electrification.

Another MoU termination announced today involves Mitsubishi, which previously considered being part of a tripartite collaboration. Mitsubishi had signed a MoU on December 23, 2024 to look into being part of the merger, and while that’s no longer happening, its existing collaboration with the pair on vehicle intelligence and electrification still stands.

With the “marriage” called off, reports indicate Nissan is open to new partnerships, with Foxconn emerging as a possible candidate. The Taiwanese technology company is seeking to expand its new electric vehicle (EV) contract manufacturing business and had previously approached Nissan about a bid.

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