Nissan shares plunged on Wednesday after Japan's Nikkei business daily said the carmaker had decided to withdraw from merger talks with rival Honda.
The newspaper and other Japanese media had earlier reported that Honda had proposed making Nissan a subsidiary, instead of the previous plan to integrate under a new holding company.
"Strong opposition" within Nissan to this proposal had led it to walk away, the Nikkei said, adding that discussions on a holding company had faltered as the pair disagreed on the integration ratio and other conditions.
In late afternoon trade in Tokyo, Nissan shares were down 4.8 percent. Honda shares, however, soared 12 percent.
Tokyo Stock Exchange then suspended trading of Nissan shares, saying that confirmation of the authenticity of media reports related to the cancellation of the merger was necessary.
Nissan and Honda agreed in December to launch discussions on joining forces to create the world's third largest automaker, seen as a bid to catch up with Tesla and Chinese electric vehicle firms.
Honda's CEO insisted at the time it was not a bailout for Nissan, which last year announced thousands of job cuts after reporting a 93 percent plunge in first-half net profit.
Lacklustre consumer spending and stiff competition in several markets are making life hard for many automakers.
Business has been especially tough for foreign brands in China where electric vehicle manufacturers such as BYD are leading the way as demand grows for less polluting vehicles.
China overtook Japan as the biggest vehicle exporter last year, helped by government support for EVs.
Honda and Nissan are Japan's number two and three automakers after Toyota.
They already agreed last year to explore a partnership on EV software and components among other technologies, an initiative joined by Mitsubishi Motors in August.
But the smaller automaker's chief said this week it would make a final decision on whether to join the Honda-Nissan merger talks in mid-February or later.
In December, reports said Taiwanese electronics behemoth Foxconn had unsuccessfully approached Nissan to acquire a majority share.
It then reportedly asked Renault to sell its 35 percent stake in Nissan -- a pursuit that was put on hold before the merger talks were announced.
Nissan has weathered a turbulent decade, including the 2018 arrest of former boss Carlos Ghosn, who later jumped bail and fled Japan concealed in a music equipment box.
The company is also saddled with billions of dollars of debt that will reportedly mature over the next two years.
© 2025 AFP
18 Comments
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Michael Machida
Told you....
iron man
nissan missed the boat (thanks to Ghosny), it should have stood by the expensive performance $$$ machines, the split will do my honda stocks ok. Better early than too late.
Bobby Franks
All downhill since Ghosn was ousted.
The company and its employees would likely have been far better off without the government-led fiasco.
Wasabi
Too bad Nissan, remember Mr Ghosn? Now you pay the price.
WatanabeBuddha
Nissan has been ruined by Ghoson.
robert maes
Alleluja !! Honda has seen the light just in time.
now Nissan in a firesale to Foxconn or doors closed.
mr Ghosn is not having one bottle but a crate of champagne this morning
lunatic
Ghosn did an outstanding job reviving Nissan from bankruptcy. However, I don't think he's eager to do it again; the Nissan people aren't very appreciative.
Alan Harrison
I can't help but gloat.
nandakandamanda
It’s a shame they still can’t get their act together at Nissan. They have made some great cars in the meantime. Maybe time for a corporate revolution in the boardroom, a thorough clear-out.
grc
WatanabeBuddha - if you’re going to blame Ghosn at least spell his name correctly
OssanAmerica
While some people are gloating that Nissan stocks have dropped 5%, there are some people buying Nissan stocks on this dip.
Pukey2
Including your Nancy Pelosi? She has a certain interest in stocks and shares.
itsonlyrocknroll
My Father second car was a orange Datsun 120y.
I still giggle when he tells everyone he drove to Pluto and back, without so much as a cough, on one set of tyres and half a tank.
He picked Mum up in up in the Datsun for there first date.
The loyal workforce deserve strong competent management.
Alan Harrison
While some people are gloating that Nissan stocks have dropped 5%, there are some people buying Nissan stocks on this dip.
Well, good lock to anybody buying Nissan shares, personally I think that Nissan is beyond redemption. I'll stick with decent, honourable companies like Toyota everything that is decent and honourable to the Japanese culture (with the exception of the Japanese legal system).
MiuraAnjin
Let's hope they haven't lost interest
Bret T
I feel bad for the workers. Undoubtedly many will lose their jobs as Nissan downsizes.
HiJapan
Who comes to gloat over a %5 turn? People who don’t actually trade, that’s who.