Honda and Nissan Consider Production Collaboration

TOKYO (Reuters) – Honda (NYSE:HMC) and Nissan (OTC:NSANY) are exploring the possibility of manufacturing vehicles in each other's factories, as reported by Kyodo news agency on Saturday without citing sources.

The report also mentioned that Honda is considering supplying hybrid vehicles to Nissan as part of a potential merger, though no source was provided for this information.

Honda, Japan's second-largest car company, and Nissan, the third-largest, are engaged in talks to strengthen their collaboration, potentially establishing a holding company, according to two individuals familiar with the negotiations. One of the sources indicated that a merger is also being discussed.

This merger could result in the creation of the world's third-largest automotive group by vehicle sales, following Toyota (NYSE:TM) and Volkswagen (ETR:VOWG_p), with an annual output of 7.4 million vehicles.

Previously, Honda and Nissan formed a strategic partnership in March to focus on electric vehicle development; however, Nissan has been encountering persistent financial and strategic challenges in recent months.