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Is a Honda-Nissan Merger the Answer to Beating China’s Growing Auto Power?

Daniel Kim Views  

Japanese automakers Nissan and Honda are merging / Shutterstock
Japanese automakers Nissan and Honda are merging / Shutterstock

There are speculations that a merger between Honda and Nissan could pose a threat to Chinese automakers.

According to Bloomberg, Honda sold 3.43 million vehicles worldwide on Wednesday in the first 11 months of 2024, while Nissan sold just over 3 million units. In contrast, BYD, China’s largest automaker, sold 3.76 million units during the same period.

As global automakers struggle to compete with rising local automakers in China, speculation is growing that a Honda-Nissan merger could help Honda overtake its Chinese rivals next year. Honda’s sales in China fell 28% in November compared to the same month in 2023, and its production fell 38% compared to the same month a year earlier. Nissan’s sales in China fell 15.1%, and its local production fell 26% during the same period.

According to the media, the Honda-Nissan merger is expected to pose a significant threat to Volkswagen, Germany’s largest automaker, following Toyota, the world’s largest automaker. Toyota’s global sales stagnated in November due to weak demand and the suspension of production at two plants.

Toyota also faces fierce competition from electric vehicles produced locally in China and hybrid gasoline-electric vehicles in the US. Like Honda and Nissan, it has been steadily losing market share to Chinese competitors in Southeast Asia. This year’s weak global demand for new vehicles and various regulatory investigations and recalls overseas, including in Japan, have also made things difficult for Toyota.

Daniel Kim
content@viewusglobal.com

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