In December 2024, reports emerged that two of Japan's automotive juggernauts are looking to form a merger akin to the automotive equivalent of a 'dream team.' On Dec. 23, the leaders of Japanese automakers Nissan (NSANY) and Honda (HMC) announced that they intend to merge under a holding company in an effort to stay competitive against its rivals in a world shifting towards electric vehicle adoption.

The problem is there is no likely outcome that would leave both companies and their employees better off than they are today.

Honda and Nissan signed a memorandum of understanding (MoU) to begin discussions on a potential business integration.

Honda and Nissan's $58bn merger aims to compete with China's EV dominance, but risks include cultural clashes, overlapping markets, and uncertain innovation outcomes.

The mooted Honda Nissan merger and the fallout from leadership change at Stellantis suggests the auto industry must brace for turmoil, where size is a survival necessity.

Nissan Motor Corporation is a Japanese automaker founded in 1933 and the parent automaker of Infiniti and formerly Datsun. Nissan produces a wide variety of mass-market vehicles, including popular SUVs like the Rogue,

Discussions are currently underway for the merger of Honda and Nissan. Working together, Honda-Nissan will have improved cost efficiencies and production capacity. They will be in a better position to tackle the threat from China-based EV manufacturers. If things go smoothly, the Honda-Nissan merger could be completed by 2026.

Honda and Nissan announced merger plans in December 2024, and the process has been progressing as per schedule. The merger will also include Mitsubishi, and both companies aim to reach a definitive agreement by June 2025.

As Honda and Nissan negotiate the terms of a possible merger, we take a speculative look at what new vehicles could spawn from the unprecedented collaboration.