Japan could soon become the world’s third-largest car company, with eight million vehicles sold, close to Volkswagen’s 9.2 million. As Japanese media report, Honda and Nissan want to talk about a possible merger in view of the tough global competition in electric vehicles. The creation of a holding company under which the two car companies and the Japanese manufacturer Mitsubishi Motors would be united is under discussion, as the Japanese business newspaper “Nikkei” reports, citing informed circles. Nissan is the largest shareholder in Mitsubishi with 24 percent. A declaration of intent should be signed soon. Nissan’s share price rose by up to 24 percent after the news became known. The Tokyo Stock Exchange announced before trading began on Wednesday that it wanted to suspend trading in the shares in order to first check the veracity of the reports, but then did not take this measure. Mitsubishi shares rose by 17 percent. Honda’s shares, on the other hand, fell in price by 3.4 percent after short-term price gains. Nissan and Honda initially only announced that they were considering various options for future collaboration, but no decisions had been made yet. 90 percent less profit for Nissan The two companies had announced in March that they would work together on the development of electric vehicles and software technologies. to reduce costs and improve their competitiveness. The market is changing so quickly that you can no longer play by the traditional rules, Honda CEO Toshihiro Mibe said back then. However, in October he rejected questions about a possible capital link between the two companies. Nissan in particular has recently suffered greatly from the rapid changes in the global car market. In the first half of the financial year that began in April, the group achieved a net profit of 90 percent less than in the same period last year. Not only has the growing competition from domestic manufacturers in China spoiled business for the Japanese. Customers also turned away in their most important foreign market, America, because Nissan is on the market there with a relatively old model range and, for example, does not have any hybrids in its range, which are particularly in demand there. At the beginning of November, Nissan boss Makoto Uchida announced a comprehensive one austerity program, which, among other things, will result in the loss of 9,000 jobs. A fifth of global production capacity should be saved. Shortly afterwards it became known that the activist investor Effissimo Capital Management from Singapore had acquired a 2.5 percent stake in the Japanese group. A week ago, the group announced a major personnel reorganization. The previous CFO Stephen Ma was moved to head the China business, and the previous Americas boss Jérémie Papin was appointed as the new CFO. Christian Meunier, who had previously managed Nissan’s luxury brand Infiniti and was previously responsible for the Jeep brand in the Stellantis Group, is to take over management of the business in the United States. Honda also had to report a profit for the past quarter that was barely half as high as expected by analysts. The group lowered its profit forecast for the full year to 950 billion yen (5.9 billion euros), which would be 14 percent less than in the previous year. More on the subject Yoshitaka Ishiyama, an analyst at major bank Mizuho Securities, evaluated the report in a message to investors Wednesday as a positive factor, at least in the short term, as it points to the possibility of deeper and more efficient collaboration between the two companies. “Nissan has been uncertain about how to reposition itself following announced structural reforms, and a deeper alliance with Honda could make it easier for the company to create a roadmap for restructuring,” he continued.
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