Japanese automakers Honda and Nissan confirmed they are discussing a potential merger to remain competitive against electric vehicle makers. A final decision currently hasn’t been made. The merger discussions reportedly also include Mitsubishi Motors. BREAKING: Japanese auto giants Honda Motor and Nissan Motor will enter negotiations for a merger and join their resources to better compete against bigger global electric vehicle makers, per the Nikkei. — unusual_whales (@unusual_whales) December 17, 2024 “As announced in March, Honda and Nissan are exploring various possibilities for future collaboration, leveraging each other’s strengths,” the companies said in a statement, according to CNN. “If there are any updates, we will inform our stakeholders at the appropriate time,” the statement added. Honda and Nissan are in merger talks, potentially bringing together two Japanese automaking titans that have recently fallen on hard times. https://t.co/iG7XMQ8zzd — CNN Breaking News (@cnnbrk) December 18, 2024 Per CNN: Honda and Nissan also confirmed to CNN that Mitsubishi is part of these preliminary talks, bringing a potential third major Japanese car manufacturer into the mix. Mitsubishi did not respond to requests for comment. In March, Honda and Nissan announced that they would partner on electric vehicles and in August said they would collaborate on battery technology. But they could benefit from deepening their ties as both have faced challenges this year. Both companies, like many non-Chinese automakers, have struggled in the once-promising China market, the world’s largest market for cars. Chinese consumers had flocked to foreign brands but have largely shifted to domestic brands, which have better perceived value in the country. China’s government has also provided incentives to help speed up customer adoption of electric vehicles and plug-in hybrids. Although both companies offer EVs and plug-ins – Nissan, in particular, was a pioneer in EV technology – Chinese brands like BYD have eclipsed their technology and are priced more cheaply. Nissan Shares Surge 23% After Report Of Merger Talks With Hondahttps://t.co/VBGFVzVvFP pic.twitter.com/VOyqhFiaY6 — Forbes (@Forbes) December 18, 2024 Honda Motor Co. and Nissan Motor Co. are preparing to start negotiations on a possible merger. The deal ultimately be expanded to include Mitsubishi Motors Co.. https://t.co/9HF6Q4qq4k pic.twitter.com/wpOBAzudL4 — Automotive News (@Automotive_News) December 17, 2024 From the Associated Press: Nissan said last month that it was slashing 9,000 jobs, or about 6% of its global work force, and reducing global production capacity by 20% after reporting a quarterly loss of 9.3 billion yen ($61 million). Earlier this month it reshuffled its management and its chief executive, Makoto Uchida, took a 50% pay cut to take responsibility for the financial woes, saying Nissan needed to become more efficient and respond better to market tastes, rising costs and other global changes. Fitch Ratings recently downgraded Nissan’s credit outlook to “negative,” citing worsening profitability, partly due to price cuts in the North American market. But it noted that it has a strong financial structure and solid cash reserves that amounted to 1.44 trillion yen ($9.4 billion). Nissan’s share price has fallen to the point where it is considered something of a bargain. A report in the Japanese financial magazine Diamond said talks with Honda gained urgency after the Taiwan maker of iPhones Hon Hai Precision Industry Co., better known as Foxconn, began exploring a possible acquisition of Nissan as part of its push into the EV sector. The company has struggled for years following a scandal that began with the arrest of its former chairman Carlos Ghosn in late 2018 on charges of fraud and misuse of company assets, allegations that he denies. He eventually was released on bail and fled to Lebanon. Honda reported its profits slipped nearly 20% in the first half of the April-March fiscal year from a year earlier, as sales suffered in China. WATCH: