Honda Motor Co has sounded out Nissan Motor Co about becoming its subsidiary, in what would be a major change to their current plan to merge under a holding company, sources familiar with the matter said Tuesday.
The two carmakers said in December that they had agreed to begin talks on merging under a holding company in 2026, while maintaining their respective brands.
The latest move comes as struggling Nissan has yet to convince Honda that it is on track for a successful business turnaround, a premise the two companies had agreed upon for the planned merger, according to the sources.
Honda's proposal is expected to face vehement opposition from Nissan over concerns that its autonomy could be undermined, analysts said, noting that Nissan gained more flexibility in management after its long-time partner Renault SA agreed in 2023 to cut its stake in the Japanese automaker.
Honda and Nissan said Friday they will postpone the announcement of their merger details to mid-February, delaying it from the originally planned end of January.
Nissan said in November it would cut 9,000 jobs worldwide and reduce its global production capacity by 20 percent after it reported a more than 90 percent drop in net profit in the April-September period. Honda has asked Nissan to present specific measures for the plans.
Nissan is now planning to offer early retirement programs to employees at its three U.S. plants and reducing its workforce in Thailand.
However, Honda has been dissatisfied with Nissan's measures, demanding more effective overhaul measures, according to the sources.
At a joint press conference in December, Honda and Nissan said they would pursue a merger to cut costs and share an increasing financial burden for developing electric cars and vehicle software to compete with powerful overseas rivals such as Tesla Inc and China's BYD Co.
© KYODO
4 Comments
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justasking
Yikes. I bet Nissan is wishing Ghosn back.
sakurasuki
Slow, everything in Japan just really slow.
Aly Rustom
Bad idea Honda.
ALmost
I'm glad to hear Honda is thinking to make Nissan a subsidiary rather than merging the two companies. Really glad. If Honda is not in charge of this union then it's better for Honda to not take part. I hope it works out and creates a stronger and more competitive player in the future of automobile production, be it EV, fuel cell or whatever. BYD is forcing all automobile makers to regroup. It's a sign of the times. Maybe a good thing, who knows.