Honda and Nissan are not merging. The companies did enter formal talks in December 2024 to create a joint holding company, partly to gain scale in electric vehicles, batteries and software-defined cars. But on February 13, 2025, they terminated the business-integration agreement after Honda proposed changing the structure so it would become Nissan’s parent company. As of August 10, 2026, the proposed merger and its planned 2026 stock-market listing do not exist.
The companies have continued to examine narrower, project-by-project cooperation with each other and Mitsubishi Motors. That is very different from the large corporate merger first reported in December 2024.
What actually happened between Honda and Nissan?
The story passed through three distinct stages:
- December 17–18, 2024: Japanese media reported that Honda and Nissan were considering a merger or joint holding-company structure. The report was not yet an official transaction announcement.
- December 23, 2024: Honda and Nissan signed a formal memorandum of understanding, or MOU, to study a business integration. Mitsubishi Motors separately agreed to explore participation.
- February 13, 2025: Honda and Nissan agreed to terminate the integration MOU after disagreeing over the proposed governance structure.
So the accurate description is that Honda and Nissan held formal merger discussions, but never merged, never created the proposed holding company and never completed a shared EV business. The brands, dealers and companies remained separate.
How the original merger report began
On December 17, 2024, a report based on Nikkei coverage said Honda and Nissan were preparing to discuss a possible merger. A holding company was reportedly under consideration, and Mitsubishi Motors was mentioned as a possible participant because of its existing relationship with Nissan.
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At that point, the report described exploratory discussions—not an agreed merger. Mitsubishi said on December 18 that media reports about its possible involvement were not based on an announcement from the company and that no decision had been made, according to its investor-relations statement.
The report became substantially confirmed six days later, when Honda and Nissan announced that they had signed an MOU to consider a full business integration.
What the December 23 MOU proposed
The MOU was a framework for studying a transaction, not a completed merger agreement. The companies still would have needed to complete due diligence, sign a definitive agreement, obtain shareholder approval and receive regulatory clearances.
The proposed structure was a new holding company created through a joint share transfer. Honda and Nissan would have become wholly owned subsidiaries of that company, while their existing brands would have continued to operate. The holding company was intended to be listed on the Tokyo Stock Exchange.
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The tentative schedule called for:
- a definitive integration agreement by June 2025;
- extraordinary shareholder meetings in April 2026;
- delisting of Honda and Nissan in late July or August 2026; and
- the new holding company’s listing and effective share transfer in August 2026.
Those dates were explicitly subject to change or cancellation. They became irrelevant when the MOU was terminated in February 2025.
The MOU also contained exclusive-negotiation provisions. Under specified circumstances involving a competing third-party transaction, the party completing that transaction could have owed a cancellation fee of ¥100 billion, according to the companies’ filing about the agreement.
What role did Mitsubishi Motors have?
Mitsubishi was never a confirmed third partner in the merger. On December 23, it signed a separate MOU agreeing to explore participation or involvement in the proposed Honda-Nissan integration. That was a commitment to examine the possibility, not approval of a three-company merger.
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Mitsubishi was strategically relevant because Nissan owned approximately 24% of the company at the time. Nissan and Mitsubishi also had existing operating ties, including cooperation on kei cars and other vehicles. A three-company group could have added sales volume and technology resources, but it also would have introduced another product portfolio, corporate culture and governance layer.
When Honda and Nissan ended their integration discussions, Mitsubishi’s potential role in that transaction ended as well. Any continuing cooperation among the three companies has been described in terms of specific technology and business projects rather than a new holding company.
Why were EVs and software at the center of the talks?
The merger discussions did not come out of nowhere. Honda and Nissan had already begun a strategic technology partnership in March 2024. Their first MOU covered automotive software platforms, EV-related core components, complementary products and technologies supporting carbon neutrality and intelligent mobility.
In August 2024, Mitsubishi joined an expanded partnership covering areas such as:
- common specifications for battery cells and modules;
- possible mutual battery supply;
- possible supply of batteries from Honda’s joint venture with LG Energy Solution to Nissan in North America after 2028;
- common e-axle specifications;
- sharing motors and inverters;
- complementary vehicle models;
- charging and energy services; and
- battery-related resource circulation in Japan.
The expanded arrangement is detailed in Honda’s August 2024 announcement. It shows that the companies were already looking for ways to spread the cost of electrification before anyone publicly described the discussions as a merger.
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Honda’s position in late 2024
Honda had important strengths in hybrid vehicles, motorcycles and engineering, but it was still building a competitive global battery-EV portfolio. Its then-current plan called for:
- seven Honda 0 Series EVs globally by 2030;
- more than 2 million EVs sold annually by 2030;
- EVs and fuel-cell vehicles to represent 40% of global auto sales by 2030;
- the first Honda 0 Series models to launch in North America in 2026;
- a battery plant with LG Energy Solution in Ohio capable of 40 GWh of annual production; and
- a 5% return-on-sales target for its EV business.
These were Honda’s plans at the time, not results that the merger achieved. Honda also planned to sell the Prologue and Acura ZDX, which were developed with General Motors using GM’s Ultium platform, before introducing its proprietary Honda 0 Series. Honda’s 2024 EV plans were outlined in its electrification strategy and its Honda 0 Series announcement.
Nissan’s position in late 2024
Nissan had an early lead in mainstream battery EVs through the Leaf and was pursuing an ambitious electrification program. Its Nissan Ambition 2030 plan called for ¥2 trillion in electrification investment over five years, 27 new electrified models by fiscal 2030, including 19 EVs, and a 55% electrified model mix across Nissan and Infiniti globally. Nissan also targeted an internally developed solid-state-battery EV for fiscal 2028.
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1Repair Windows errors before they cause bigger problems2Fix the driver behind crashes, sound loss and screen glitches3Clear out junk files and repair common Windows errorsAt the same time, Nissan was under substantial financial and operational pressure. For the nine months ended December 31, 2024, Nissan reported:
- a 1.8% decline in global retail sales;
- an 86.6% decline in operating income; and
- negative automotive free cash flow of ¥506.7 billion.
Nissan’s turnaround program included reducing global production capacity by 20%, cutting its workforce by 9,000 and targeting a business structure capable of sustainable profitability at 3.5 million annual vehicle sales by fiscal 2026. Those figures come from Nissan’s nine-month financial results.
Nissan’s regional sales also showed why speed and scale mattered. In fiscal 2023, sales fell 24.1% in China to 794,000 vehicles and 19.8% in the United States to 916,000, according to Nissan’s regional sales data.
The broader competitive threat
The challenge was not just the cost of assembling battery packs. Automakers were competing over battery chemistry, vehicle software, digital cabin features, over-the-air updates, advanced driver assistance and the speed of launching new models.
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That makes it inaccurate to call the proposal solely an EV merger. EVs, batteries and software were major reasons for seeking scale, but the official integration plan also covered purchasing, research and development, manufacturing, sales finance, talent and resource allocation.
How large could the proposed group have been?
Honda and Nissan sold approximately 7.35 million vehicles combined in 2023. Adding Mitsubishi would have increased that total. By volume, the proposed group would have ranked among the world’s largest automakers—but it never became an operating company, so it should not be described as an achieved third-largest automaker.
The companies said a successful integration could generate more than ¥30 trillion in revenue and more than ¥3 trillion in operating profit. Reuters reported that the companies were targeting more than ¥1 trillion in potential synergies.
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Those were management targets and reported synergy ambitions, not guaranteed savings. Potential sources of value included:
- common vehicle platforms and parts;
- shared EV and software research;
- common battery and e-axle development;
- joint purchasing and greater supplier leverage;
- better utilization of manufacturing plants;
- broader sales-finance operations;
- shared charging and energy services; and
- a larger pool of engineering, software and manufacturing talent.
The principal challenge was timing. Batteries, EV platforms, factories and software systems cannot be combined instantly. Analysts warned that the companies could spend years integrating operations before realizing the benefits, while Chinese competitors continued to shorten product cycles and improve their technology.
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Why did the Honda-Nissan merger talks fail?
The companies’ official explanation centers on control and decision-making. Honda proposed replacing the planned joint holding-company structure with a parent-subsidiary arrangement in which Honda would be Nissan’s parent. On February 13, 2025, Honda and Nissan announced that they had agreed to terminate the MOU because they believed ending the integration discussions would better preserve the speed of decision-making required during the industry’s electrification transition.
In practical terms, the proposed equal-style holding company proved difficult to reconcile with the companies’ different financial positions. Honda was the stronger party financially and operationally, while Nissan was attempting to execute a major turnaround. An equal structure could make control unclear; a Honda-controlled structure could make Nissan feel subordinate.
Contemporary Japanese media and Reuters-sourced reports said Nissan resisted becoming a subsidiary and that disputes over governance, valuation and the pace of Nissan’s recovery contributed to the breakdown. Those details should be understood as reported explanations rather than facts fully set out in the companies’ brief termination announcement.
Several additional issues made the proposed integration difficult:
- Control imbalance: Honda’s stronger position made an apparently equal combination hard to govern.
- Turnaround risk: Nissan’s financial recovery would have had to progress while both companies were undertaking a major industrial integration.
- Different corporate priorities: Honda was focused on technology and long-term product development, while Nissan was under immediate pressure to restore profitability and market competitiveness.
- Overlapping markets: Both companies depended heavily on Japan and North America, limiting the diversification benefit of simply combining sales networks.
- Mitsubishi complexity: A third participant would have added potential scale but also more governance and product overlap.
- Renault considerations: Nissan’s continuing relationship with Renault added further alliance and capital-structure considerations.
- Execution speed: A combination intended to accelerate software and EV development could instead slow decisions if governance remained unsettled.
Claims that the Japanese government forced the companies together, or that Honda was formally attempting to rescue or buy Nissan, require separate evidence and should not be presented as established facts from the MOU.
What cooperation remained after the merger collapsed?
Ending the integration MOU did not automatically end every Honda-Nissan technology discussion. Honda later said the strategic-partnership MOU signed with Nissan and Mitsubishi remained in effect and that the companies were reviewing individual projects. Those areas included software-defined vehicles, batteries, e-axles, vehicle complementation, energy services and resource recycling.
Honda’s investor briefing said the companies could still pursue scale without a capital tie-up. Nissan’s current partnership materials likewise describe ongoing cooperation with Honda and Mitsubishi in vehicle intelligence and electrification.
The distinction is important:
- Ended: the proposed Honda-Nissan business integration, the joint holding company, the planned share transfer, the proposed delistings and the August 2026 listing.
- Still possible or under discussion: individual technical and business projects involving software, batteries, e-axles, energy services and complementary vehicles.
- Not established: a completed common Honda-Nissan EV platform, a merged vehicle lineup or a jointly operated holding company.
Nissan continues to emphasize software-defined vehicles, AI-enabled vehicles, e-POWER and battery technology in its current strategy. Nissan says it plans to introduce its SDV platform in fiscal 2026 and continues to identify Honda and Mitsubishi as partnership counterparts in vehicle intelligence and electrification.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.Honda’s EV strategy changed after the talks ended
The original merger rationale also needs to be viewed through Honda’s later change in direction. In March 2026, Honda announced the cancellation of three planned North American EV programs: the Honda 0 SUV, Honda 0 Saloon and Acura RSX. Honda cited weaker EV demand, changed U.S. policy and intensified competition from Chinese automakers. It estimated that the reassessment could involve maximum cumulative losses of ¥2.5 trillion, although that was an estimate subject to change.
In May 2026, Honda said it would redirect significant resources toward hybrids. It planned to launch 15 next-generation hybrid models globally by the end of fiscal 2030, redirect excess North American plant capacity toward gasoline and hybrid vehicles, convert part of its LG battery capacity to hybrid-battery production and indefinitely suspend its planned comprehensive EV value chain in Canada.
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What did the proposed deal mean for car buyers?
Even if the merger had been completed, consumers were unlikely to see immediate changes. Vehicle platforms, battery systems, software and production arrangements take years to develop. Honda and Nissan would have continued operating their brands and dealer networks separately during any transition.
Because the transaction was terminated, buyers should not assume that:
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- Honda and Nissan vehicles have been merged;
- Honda dealerships became Nissan dealerships;
- Nissan EVs automatically received Honda hybrid technology;
- a shared Honda-Nissan EV platform entered production; or
- the two brands will necessarily share future models.
Any future shared vehicle, battery system or software project would need to be announced separately. The strategic partnership creates the possibility of cooperation, not proof that a particular product exists.
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What did it mean for employees and factories?
A completed integration could have produced overlap in engineering, purchasing, manufacturing and administrative operations. The December MOU specifically contemplated discussions covering R&D, purchasing and manufacturing.
However, no definitive Honda-Nissan restructuring plan was reached before the talks ended. Specific plant closures, job losses or Honda-Nissan production transfers should not be described as consequences of the failed merger.
Nissan’s previously announced plan to cut 9,000 jobs and reduce global production capacity by 20% was part of Nissan’s own turnaround program. It was not an announced result of the Honda-Nissan integration talks.
What investors should take from the failed deal
The proposed transaction offered a way to spread the cost of electrification and software development across a much larger industrial base. But the most important financial targets never became results of a combined company.
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- The more than ¥1 trillion in potential synergies were not realized as merger savings.
- The proposed revenue above ¥30 trillion and operating profit above ¥3 trillion belonged to the planned group, which was never created.
- The proposed share-transfer ratio was never finalized.
- The planned shareholder votes and Tokyo Stock Exchange listing never took place.
- Nissan’s standalone turnaround and Honda’s revised electrification strategy became the relevant corporate issues.
For Nissan, the failure left the company responsible for restoring profitability and executing its product and software plans without Honda’s capital integration. For Honda, it preserved corporate independence but also left the company to fund and organize its electrification strategy on its own, while continuing to consider narrower partnerships.
Common misconceptions about the Honda-Nissan talks
Did Honda and Nissan merge?
No. They signed an MOU to study a business integration on December 23, 2024, then terminated it on February 13, 2025.
Did Honda buy Nissan?
No. Honda proposed a parent-subsidiary structure in which Honda would have controlled Nissan, but that structure was never completed.
Did Mitsubishi join the merger?
No. Mitsubishi agreed to explore participation or involvement. It was never confirmed as a completed third partner in a Honda-Nissan holding company.
Was the deal only about electric cars?
No. EVs, batteries and software were major strategic drivers, but the proposed integration also covered purchasing, R&D, manufacturing, sales finance, talent, energy services and resource allocation.
Is the August 2026 listing still planned?
No. The planned listing was cancelled in practice when Honda and Nissan terminated the integration MOU in February 2025.
Frequently Asked Questions
Are Honda and Nissan merging now?
No. Honda and Nissan terminated their formal business-integration MOU on February 13, 2025. They remain separate automakers, although they have continued to examine narrower technology and business projects.
What was Mitsubishi Motors’ role?
Mitsubishi was not a confirmed merger partner. It signed a separate MOU to explore participation or involvement in the proposed integration, but no three-company holding company was created.
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No shared production EV was established by the merger talks. The companies have discussed possible cooperation involving batteries, e-axles, software-defined vehicles and complementary products, but each project must be assessed or announced separately.
The Bottom Line
Bottom line: The December 2024 report was followed by a real Honda-Nissan MOU, but it was an agreement to study a joint holding company—not a completed merger. Honda’s later proposal to make itself Nissan’s parent exposed a disagreement over control, and the talks ended on February 13, 2025. Honda, Nissan and Mitsubishi may still cooperate on selected electrification and software projects, but no combined automaker was created. The original EV rationale has also shifted: Honda’s 2026 strategy places much more emphasis on hybrids after cancelling three planned North American EV programs.
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