Nissan and Honda announce plans to merge in 2026

Japanese auto giants Nissan and Honda have announced plans to merge their businesses into one in 2026 following recent speculation surrounding a possible tie-up.

The companies said on Monday that they had signed a memorandum of understanding "to start discussions and considerations toward a business integration between the two companies through the establishment of a joint holding company".

The potential merger, which is said to have received backing from the Japanese government, would create a company with sales in excess of 30trn yen (£152bn) and operating profit of more than 3trn yen.

Nissan and Honda said they expect to have a definitive merger agreement in place by June 2025, with a newly established joint holding company listed on the Tokyo Stock Exchange by April 2026.

Merger speculation had ramped up over recent days after an announcement on 18 December that the manufacturers were in discussions, and follows a MOU between the two signed back in August which sought to deepen their strategic partnership.

Over recent months, the two sides had engaged in talks in regards to "various possibilities and options" at a time of rapid change and technological innovation in the auto industry, such as joint research into next-generation vehicles, they said.

"The MOU between Nissan and Honda announced today is aimed to serve as an option to maintain global competitiveness and for the two companies to continue to deliver more attractive products and services to customers worldwide," the companies said in a joint statement.