This follows a similar agreement between Nissan and Honda to create a holding company, which will own Honda and Nissan, creating the world’s third-largest automaker.
23 Dec 2024 | 4134 Views | By Autocar Pro News Desk
In a significant development for the global automotive industry, Nissan Motor Co., Honda Motor Co., and Mitsubishi Motors Corporation announced today that they have signed a memorandum of understanding (MOU) to explore a potential three-way business integration.
“Nissan, Honda, and Mitsubishi Motors have reached a basic agreement to proceed ...
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In a significant development for the global automotive industry, Nissan Motor Co., Honda Motor Co., and Mitsubishi Motors Corporation announced today that they have signed a memorandum of understanding (MOU) to explore a potential three-way business integration.
“Nissan, Honda, and Mitsubishi Motors have reached a basic agreement to proceed with discussions based on the framework established in the MOU signed by Nissan and Honda on August 1 regarding the commencement of a strategic partnership focused on intelligence and electrification. Mitsubishi Motors has been participating in this framework, and the three companies have been proceeding with discussions,” the companies said in a statement.
This builds upon an earlier strategic partnership between Nissan and Honda, which focused on intelligence and electrification collaboration, and indicates that Mitsubishi Motors, which has been participating in these discussions, is now considering formal involvement in the business integration through a joint holding company structure.
"Honda and Nissan have begun considering a business integration, and will study the creation of significant synergies between the two companies in a wide range of fields," said Nissan CEO Makoto Uchida. "It is significant that Nissan's partner, Mitsubishi Motors, is also involved in these discussions."
The move comes as the automotive industry faces what Honda Director Toshihiro Mibe described as "change in the automobile industry, which is said to occur once every 100 years." The companies aim to leverage their combined strengths to become a leading force in creating new mobility value.
Mitsubishi Motors is expected to reach a decision about its participation in the integration by the end of January 2025. Mitsubishi Motors CEO Takao Kato emphasized that the collaboration would "accelerate synergy maximization effects" and noted that the companies will study the best form of cooperation to utilize each company's strengths.
The potential integration represents one of the largest consolidations in the Japanese automotive sector and comes as the industry grapples with the transition to electric vehicles, autonomous driving technology, and changing consumer preferences. If successful, the partnership could create a powerful automotive alliance better positioned to compete in the rapidly evolving global market.
The companies noted that the completion of the business integration remains subject to various conditions, including regulatory approvals and final agreement on definitive terms.
Nissan, Honda Agreement
Separately, Honda and Nissan Motor today officially announced that they have started talks on a potential merger. The companies plan to create a holding company, which will own Honda and Nissan, creating the world’s third-largest automaker.
The companies will explore the possibility of participation, and involvement in sharing with the business integration, aiming to reach its conclusion by the end of January 2025.
“Given the drastically changing business environment, Nissan and Honda have been holding discussions on ongoing joint projects. As a result of the series of dialogues, we discovered that the synergy from a business integration is greater than anticipated,” Honda Motor Director, President and Representative Executive Officer Toshihiro Mibe said.
Honda and Nissan will be wholly owned subsidiaries of the holding company with their respective brands to continue. Mibe noted that the integration has the potential to create a combined entity that could generate annual revenue exceeding 30 trillion yen and an operating profit of over 3 trillion yen.
The companies will explore potential synergies in research and development, vehicle platforms, and regional operations in a bid to boost their brand strength and improve operational efficiency.
“The integration discussions are not a sign of Nissan giving up on its turnaround efforts but rather a strategic move to strengthen competitiveness and future growth through synergies with Honda,” said Nissan Director, President and CEO Makoto Uchida.