Three major car brands unveil plan for merger to form world’s third-largest carmaker – & eyes up huge ‘return to the UK’
HONDA, Nissan and Mitsubishi have confirmed they are in talks over a three-way merger that could potentially form the world’s third-largest carmaker.
The Japanese trio are looking to join forces after all three have experienced falling sales and intense competition from overseas – especially from car brands in China.
Both Honda and Nissan, Japan’s second and third-largest carmakers respectively, said they had agreed to “start consideration toward a business integration through the establishment of a joint holding company” in a joint press conference in Tokyo on Monday.
Smaller car brand Mitsubishi has said it will also decide if it wants to join by the end of January.
Combined, the three would create the world’s third-largest carmaker in terms of annual sales, placing them only behind Toyota and Volkswagen.
The move could also see Honda return to the UK, after they closed their manufacturing plant in 2021.
Nissan famously operates from Sunderland, in what is the company’s primary European outpost, and the merger could mean the two brands will be able to use each other’s plants to build vehicles.
Sun Motors’ Rob Gill visited the incredible set-up earlier this year to see the best-selling Qashqai being built, describing it as “Britain’s No1 car plant”.
In contrast, Honda currently has no car production operations in Europe – only engine and motorcycle plants.
One of their officials said: “We have 12 or 14 months to survive.
“This is going to be tough.
“And in the end, we need Japan and the US to be generating cash.”
In general, Japan’s carmakers—aside from Toyota—have been struggling to come up with the money to switch from designing and building petrol and diesel motors to cleaner electric vehicles.
But Chinese manufacturers, such as BYD, have become outliers in the car industry by prioritising the production of EVs.
Honda’s chief executive, Toshihiro Mibe, spoke of the recent industry change and the challenges it posed to carmakers at a joint press conference in Tokyo.
He said: “The rise of Chinese automakers and new players has changed the car industry quite a lot.
“We have to build up capabilities to fight with them by 2030, otherwise we’ll be beaten.”
He added that Nissan and Honda would “clarify the possibility of business integration by around the end of January in line with the consideration of Mitsubishi Motors”.
Makoto Uchida, the Nissan chief executive, said: “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.”
The possibility of Honda returning to the UK would be a major boost for the British car industry.
National production fell by almost a third in November to the lowest level for the month since 1980 – according to figures compiled by Society of Motor Manufacturers and Traders.
The three companies plan to finish talks around June 2025 and then set up a holding company by August 2026.
The move would mark the world’s biggest reshaping in the global car industry since Fiat Chrysler Automobiles and PSA merged in 2021 to create Stellantis.
Stellantis, though, is experiencing problems of its own and recently announced it was closing its Vauxhall plant in Luton – putting over 1,000 jobs at risk.