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Honda and Nissan are reportedly in talks to merge in an effort to better compete in the rapidly changing electric vehicle (EV) market. According to anonymous sources, the two Japanese automakers have been discussing a plan to split equity into a new holding company from which both companies would operate.
This move comes as Honda and Nissan face significant challenges in adapting to the shifting landscape of the EV industry. As Bloomberg reports, Japanese manufacturers are losing market share in Asia to Chinese competitors, with China set to overtake Japan as the world’s largest electric vehicle market by 2025.
The proposed merger would see Honda and Nissan combining their resources and expertise to better navigate this uncertain future. This move is not unprecedented – other Japanese electronics brands have successfully collaborated in the past, such as Konica Minolta and JVCKenwood.
However, it’s Nissan that appears to be facing more pressing concerns. According to Reuters, the company’s net earnings plummeted by over 90% year-over-year, with an additional 70% cut to its annual operating profit forecast. This has led some analysts to speculate that Nissan may only survive for another year without external intervention.
Honda, on the other hand, is preparing to launch its new Honda Zero EV platform next year and has seen some success in the US with its General Motors-based electric Prologue SUV. While neither company has publicly confirmed any merger discussions, they have released a joint statement acknowledging their exploration of “various possibilities for future collaboration.”
As part of this collaboration, both companies have been working together to develop EV technology and software, and have even invited Mitsubishi into the fold. The inclusion of Mitsubishi would mirror past collaborations between Japanese electronics brands.
The proposed merger is not without its challenges – as Honda prepares to launch its new electric platform, it may be difficult for the two companies to reconcile their differing strategies and visions moving forward. Nevertheless, with the global EV market growth slowing worldwide and Chinese manufacturers gaining a significant advantage in Asia, this move could be seen as a necessary step for both companies to remain competitive.
It remains to be seen whether these merger talks will ultimately lead to a successful partnership or not. For now, it appears that Honda and Nissan are exploring all options to better position themselves in the rapidly evolving EV landscape.
Source: www.theverge.com
