Nissan, Honda in merger talks to avoid Foxconn takeover

The global Nissan crisis has taken another ugly turn after talk of a merger with a hated rival.

Nissan’s crisis has taken another turn, with the Japanese auto giant reportedly in talks to merge with Honda to avoid being taken over by a Taiwanese smartphone manufacturer.

The Asia Nikkei, which broke news of a potential new company formed by Honda and Nissan, said the duo “will begin merger talks as early as Monday”.

MORE: Nissan on the brink of collapse

Nissan could be on the road to a merger with Honda.

It says the deal could be rushed into place because Foxconn, a tech giant famous for assembling Apple’s iPhone, has been “working behind the scenes to acquire a stake in Nissan”.

Foxconn has made no secret of its automotive ambition.

The company hopes to pivot from smartphones to EVs at scale, and has built concept cars to tempt carmakers into entering partnerships.

MORE: Why Nissan is in trouble

The Foxconn Technology Group’s Model V pick-up.

Foxconn even built an electric ute to try and lure auto brands into a deal to make a rival to the Tesla Cybertruck.

Nissan is in a vulnerable position, with weak profits prompting the company to cut 9000 jobs, slash costs and reduce production by 20 per cent in coming months.

A merger between Nissan and Honda would create the world’s third largest car company, giving it enormous resources in research, development and manufacturing.

MORE: Legacy brands struggle to stay afloat

Honda’s Civic Type R is a brilliant car, but one behind the times.

Honda has been slow to adopt electric cars. The brand has not introduced an EV in Australia, where its market share continues to slide.

Honda sold fewer cars than Chinese brands such as BYD, Chery, GWM and LDV last month.

Australian auto analyst Mike Costello said the Japanese auto industry is eyeing mergers between traditional rivals such as Nissan and Honda, as it is “the best way to survive against China”.

Reuters analyst Antony Currie says “a well-executed merger could buy Nissan and Honda time not just to slash expenses but to bolster their subpar portfolio, not least of electric and hybrid cars”.

A Nissan/Honda merger won’t be easy. Culturally, they are two very different organisations. But their lack of progress in transitioning to EVs has made this outcome a possibility. It should be a wake-up call to all legacy OEMs. pic.twitter.com/u6z8bQGzWU

— Dr. Andy Palmer (@AndyatAuto) December 18, 2024

Former Nissan executive Andy Palmer said on X that a Nissan/Honda merger “won’t be easy”.

“Huge news if true,” Palmer said.

“Two very different corporate cultures to bring together and this will be a huge hurdle.

Originally published as Nissan, Honda in merger talks to avoid Foxconn takeover