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Nissan and Honda’s $60 Billion Merger Plans Go Up in Smoke

Daniel Kim Views  

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Honda and Nissan, Japan’s second and third-largest automakers, officially called off their proposed $60 billion merger.

Both companies held separate board meetings on Thursday to formally end merger discussions. The two had been exploring a potential management integration since December but ultimately disagreed.

Honda had proposed to make the financially struggling Nissan its subsidiary. Nissan, seeking a more equal partnership, strongly opposed this idea. News of the merger talks’ suspension first broke last week.

The potential merger had garnered significant attention in the global automotive industry. If successful, analysts predicted the combined entity would have become the world’s third-largest automaker by annual sales, surpassing Hyundai Motor Group. There was also speculation that Mitsubishi Motors, Nissan’s largest shareholder, might join the merger.

Sources close to the matter revealed that Honda and Nissan clashed over key issues, including the management of Nissan’s overseas factories and its existing alliance with Renault.

This development comes as Nissan faces significant financial challenges. Profits have plummeted by over 90% compared to the previous year, and the company has also slashed its annual operating profit forecast by nearly 70%. Honda reported a 5% increase in profits for the third quarter.

Daniel Kim
content@viewusglobal.com

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