Nissan and Honda have officially terminated discussions regarding a potential business integration. The decision, announced today, comes as Nissan unveils a comprehensive restructuring plan aimed at streamlining operations and cutting costs.
The two companies signed a Memorandum of Understanding (MOU) in December 2024 to explore a possible merger. However, after months of discussions, they were unable to agree on a viable integration structure. Honda had proposed a share exchange arrangement that would have positioned it as the parent company and Nissan as a subsidiary – an approach that Nissan ultimately declined. Both carmakers have opted instead to pursue a strategic partnership focused on electrification and intelligent vehicle development, rather than a full-scale merger.
The decision coincides with Nissan’s announcement of an aggressive cost-cutting plan designed to improve efficiency and profitability amid ongoing market volatility. The company aims to reduce costs by approximately 400 billion yen by 2026, targeting significant reductions in both fixed and variable expenses.
This includes a restructuring of its global manufacturing operations, a 20 per cent reduction in production capacity, and an overall workforce downsizing of 6500 employees across key markets such as the USA and Thailand.
As part of its restructuring, Nissan will consolidate production lines, adjust shift patterns, and streamline supply chain operations. The carmaker also plans to enhance development efficiency through a ‘family development’ approach, which is expected to shorten time-to-market for new models while lowering engineering costs. Additionally, Nissan will expand its lineup of hybrid and electric vehicles, including the next-generation LEAF and an all-new compact EV, to strengthen its position.
Beyond internal restructuring, Nissan is actively seeking new partnerships to bolster its technological and financial position. The company will conduct a strategic review to identify collaboration opportunities that align with its long-term goals. Nissan has reaffirmed its commitment to working with Honda on specific technology-sharing initiatives while maintaining autonomy in its overall business strategy.
