Why Honda and Nissan’s Merger Deal Fell Apart

Honda and Nissan announced the cancellation of their merger talks last week, less than two months after agreeing to explore plans to establish a new holding company set to launch by 2026. Details about the reasons behind the failure of this deal have begun to emerge, revealing that the disagreements between the two Japanese automakers centered on two main points.

Previous reports had indicated that Honda sought to make Nissan a subsidiary, but it also made an unprecedented request. According to Japan News, the English-language section of Japan"s Yomiuri Shimbun newspaper, Honda demanded that Nissan abandon its hybrid powertrain system. Specifically, Honda asked Nissan to stop using its e-Power technology and adopt Honda"s hybrid system instead.

This unusual request faced strong opposition from Nissan, leading to a widening rift between the two companies. Although the merger will not proceed, the two companies will continue to collaborate on the development of electric vehicles.

For its part, Nissan continues to develop its e-Power system and is currently working on launching the third generation of this technology. As announced last week during the product roadmap presentation, the next-generation electric system will be 20% more efficient than the original version introduced in 2016.