Honda and Nissan Merger Analysis

(Reuters) – A merger between Honda (NYSE:HMC) and Nissan (OTC:NSANY) would not yield quick gains, according to S&P analysts released on Wednesday. The two automakers would first need to align their strategies, while overlapping regional markets could limit potential sales benefits.

Potential Value

While this potential deal could create a $54 billion automotive company, the world's third-largest, any improvements in credit outlook would be delayed, according to the report.

Collaboration Challenges

S&P analysts mentioned the difficulty in quickly achieving significant effects through an expanded collaboration that includes batteries, software, and autonomous driving. However, they acknowledged a significant eventual impact on creditworthiness.

Credit Outlook Implications

A merger could adversely affect Honda's standalone credit outlook, while it may have a positive impact on Nissan's. Analysts also pointed out the differing development strategies of Honda and Nissan.

Regional Market Overlap

They operate in similar markets, particularly in North America, China, and Japan, which limits their capability to complement each other concerning regional sales.