The ongoing corporate drama between Japan’s automotive powerhouses, Nissan and Honda, has taken another turn. According to a new report from the Financial Times, Honda Motor Co. is open to reviving merger discussions with Nissan—on one condition: Nissan’s CEO, Makoto Uchida, must step down.
This development follows last week’s collapse of the $60 billion merger talks between the two automakers, which we previously covered here at Automotive Addicts. Those failed negotiations underscored Nissan’s struggles and highlighted the growing pressure from both Western rivals and China’s rapidly emerging automotive giants.
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Uchida has been leading Nissan since late 2019, steering the company through turbulent times following the Carlos Ghosn scandal. However, Nissan’s performance under his tenure has left much to be desired. Dwindling U.S. sales, a sluggish transition to electric and hybrid vehicles, and intensifying competition in China have all compounded the pressure on Nissan’s top executive.
The FT report suggests that Nissan’s board, along with its French alliance partner Renault, is informally discussing Uchida’s future. While Uchida intends to remain CEO until 2026, mounting frustrations within Nissan’s leadership ranks could force his exit much sooner.
Honda’s willingness to return to the negotiating table isn’t necessarily a sign of desperation but rather a strategic move. Honda CEO Toshihiro Mibe has made it clear there are no intentions for a hostile takeover. Instead, Honda seeks a partner that can navigate internal resistance and align with its long-term vision—something Uchida seemingly struggled to accomplish during the prior talks.
Sources suggest that Nissan’s refusal to accept a subsidiary role under Honda was a significant factor in the breakdown of those initial discussions. Pride and a lack of urgency within Nissan’s executive team created an impasse, leaving both companies to face growing uncertainty. Our earlier coverage delves into the pride-driven breakdown and the implications it holds for Nissan’s future.
Nissan’s troubles extend beyond Honda. The automaker is also fielding interest from tech manufacturing giant Foxconn, which has been seeking a partnership to advance its electric vehicle ambitions. We previously explored this development on Automotive Addicts. While Foxconn’s approach leans more toward collaboration than acquisition, the underlying message is clear: Nissan is seen as vulnerable.
This vulnerability stems from Nissan’s slow adaptation to industry shifts, particularly in the EV and hybrid segments. Honda, on the other hand, is aggressively pursuing electrification and likely views Nissan as both a potential asset and a liability that could drag down its progress—hence the insistence on a leadership shake-up.
The next few months could define the future of both companies. Nissan is expected to provide an update on its turnaround plan within weeks. That plan includes cutting 9,000 jobs globally and reducing manufacturing capacity by 20%. Whether these measures will satisfy investors and board members remains to be seen.
If Uchida is forced to step aside, Honda’s re-entry into merger talks could reshape the global automotive landscape, creating the world’s fourth-largest automaker. Such a partnership would not only enhance their hybrid and EV capabilities but also offer a more unified front against growing Chinese competition and the ever-expanding influence of Tesla.
However, if Nissan resists internal change, it risks further isolation—potentially losing out on strategic alliances that could safeguard its future.
Nissan’s next move could be its most critical in years. The automaker is at a crossroads, with the opportunity to either forge a transformative partnership with Honda or risk falling further behind as the industry evolves. As we’ve seen in the past with Nissan’s struggles, including its delicate balancing act with Renault and its hesitation around Foxconn’s overtures, the company’s leadership must act decisively.
