Nissan has halted merger negotiations with Honda after seven weeks without an agreement, the company reported.
The plan was to create a joint holding company, but Honda proposed a full acquisition of Nissan, which did not move forward.
Nissan’s financial crisis influenced the discussions. In the first half of 2024, the automaker saw a 90% drop in operating profits and a 94% reduction in net profit compared to the previous year.
To address the situation, the company cut 9,000 jobs, reduced production capacity by 20%, changed part of its leadership, and cut the CEO’s salary by 50%.
The Tokyo Stock Exchange suspended trading of Nissan shares.
Honda, with a market value four times higher than Nissan’s, demanded changes in the company’s structure before any agreement.
Renault, which owns 36% of Nissan, questioned the negotiations and called for financial compensation.
The merger would have allowed for a recovery in the U.S. market and advancements in electric vehicle production, in response to competition from Chinese automakers.
According to Nissan, its partner Mitsubishi assessed the merger but will only decide after the final agreement between the two companies.
Source: Mercado
