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Will Honda revive takeover talks with Nissan if CEO Makoto Uchida steps down?

by admin February 18, 2025
February 18, 2025
Will Honda revive takeover talks with Nissan if CEO Makoto Uchida steps down?

The Japanese automotive sector is at a crossroads as Nissan faces a pivotal leadership shake-up that could reignite stalled merger talks with Honda.

The collapse of discussions last week between Japan’s second and third-largest automakers left Nissan grappling with uncertainty.

With CEO Makoto Uchida under mounting pressure to step down, the prospect of a renewed $60 billion merger is once again in focus.

Nissan’s struggles—fuelled by dwindling hybrid sales in the US and mounting competition in China—have intensified internal divisions, with the board now discussing a leadership transition.

Honda, which initially withdrew from merger talks due to Nissan’s resistance to becoming a subsidiary, is reportedly open to revisiting negotiations under new leadership.

The question remains: will Uchida’s departure clear the way for one of the biggest automotive consolidations in history?

Nissan’s hybrid struggles

Nissan’s failure to keep pace in the hybrid and electric vehicle (EV) markets has led to a sharp decline in earnings.

In the US, its hybrid lineup has failed to match the success of rivals like Toyota, while in China, local manufacturers are rapidly eroding Nissan’s market share.

As EV demand rises globally, Nissan’s lack of competitive models has made it increasingly vulnerable.

Honda, on the other hand, has maintained a stronger hybrid and EV strategy, leveraging partnerships to secure its position.

A merger with Nissan could provide Honda with access to Nissan’s existing manufacturing infrastructure while allowing Nissan to benefit from Honda’s advanced hybrid and EV technology. Nissan’s reluctance to relinquish autonomy was a major factor in derailing talks last month.

Now, with the board evaluating Uchida’s future, the automaker must decide whether a leadership overhaul is the key to unlocking a strategic alliance with Honda or if it will continue to pursue an independent turnaround plan.

Internal resistance at Nissan

Uchida’s tenure at Nissan has been marked by attempts to stabilize the company following years of turmoil, including the fallout from former CEO Carlos Ghosn’s departure.

The failure of merger talks with Honda has led to growing dissatisfaction among board members and French partner Renault, which holds a 43% stake in Nissan.

While Honda CEO Toshihiro Mibe has ruled out a hostile takeover, he remains open to discussions with a leader willing to engage in deeper collaboration.

The pressure on Uchida has intensified following Nissan’s recent cost-cutting initiatives, which include plans to reduce its workforce by 9,000 and scale back global manufacturing capacity by 20%.

The company has committed to providing an update on its turnaround program within the next month, a move that could influence the timeline of any leadership change.

Will a leadership shake-up revive merger talks?

The fate of Nissan’s merger with Honda hinges on whether the automaker can overcome its internal divisions and align on a strategic path forward.

If Uchida steps down, it could pave the way for renewed discussions, particularly if his successor is more open to integration with Honda.

However, Nissan’s historical resistance to mergers—driven by a desire to maintain independence—suggests that any renewed talks would still face challenges.

The company must weigh the risks of further market decline against the potential benefits of a stronger alliance with Honda.

With Honda signaling that it would consider a deal under the right circumstances, all eyes are now on Nissan’s next move.

Whether the automaker chooses to embrace a merger or double down on its independent revival efforts will shape the future of Japan’s automotive industry for years to come.

The post Will Honda revive takeover talks with Nissan if CEO Makoto Uchida steps down? appeared first on Invezz

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