Former Nissan CEO Carlos Ghosn stated on a CNBC program that merging with Honda would suffer Nissan as the company will become a minor partner, resulting in cost-cutting, duplication of plans, and duplication of technology, while Honda will be the main driver onward.
The Honda-Nissan merger was mere speculation until last Monday’s news conference. Their current proposal suggests a holding company as the parent entity, listed on the Tokyo Stock Exchange, with Honda, whose market capitalization is four times that of Nissan, nominating most of the board members.
The merger would value the group at $54 billion, surpassing South Korea’s Hyundai to become the world’s third-largest automaker by vehicle sales. With shared intelligence and resources, the combined company can compete in the EV transition and achieve economies of scale, which could boost operating profit to 3 trillion yen ($19.1 billion).
However, the process faces challenges and skepticism as Nissan is cutting a fifth of its global production capacity and laying off 9,000 workers. Meanwhile, Honda reassured shareholders concerned about taking on Nissan’s financial burden, stating that success will only be possible if both companies can stand on their own.
Both Ghosn and Kei Okamura, senior vice president at Neuberger Berman, expressed doubts about the merger plan. Okamura noted that while Monday’s announcement outlined the timeline, near-term, and long-term vision, it lacked details on how to achieve those goals. He warned that without full integration across all levels, the deal could unravel.
