Nissan has officially halted merger talks with Honda and is now exploring potential collaborations with new partners, including technology firms, according to The Guardian.

Discussions regarding the merger between the two Japanese automakers began in December 2024. If successful, Honda, Nissan, and Mitsubishi could have formed the world's third-largest automaker. One of the reasons cited for the merger was the competition with the Chinese automotive industry.

However, disagreements between the parties led Nissan to decide to withdraw from the negotiations.

According to sources, Nissan's CEO met with his Honda counterpart on February 6 and communicated the intention to cease discussions on the deal. The main reason was Honda's demand for Nissan to become a subsidiary, which Nissan's management found unacceptable.

Nissan plans to formally announce its withdrawal from the talks at a board meeting prior to the release of its third-quarter financial results, scheduled for February 13. Meanwhile, Honda has stated that it will not agree to a merger unless Nissan accepts the status of a subsidiary.

Following the breakdown of negotiations, Nissan is considering partnerships with technology companies to adapt to the transformation of the automotive market related to electric vehicles and software.

One potential partner could be Foxconn, the world's largest contract electronics manufacturer, known as Apple's primary subcontractor. Previously, Foxconn attempted to acquire a stake in Renault's share of Nissan, which led to the initiation of talks between Honda and Nissan. In December, Nissan had already rejected Foxconn's proposal, but now the company's management is once again considering collaboration.

Foxconn's electric vehicle division is led by former Nissan executive Jun Seki, who was previously considered a candidate for the CEO position at Nissan.

Nissan's decision to exit the negotiations impacted the stock prices of both companies: Nissan's shares rose by 7.3% on February 6, while Honda's shares fell by 4%.

Both companies have yet to provide official comments regarding the current status of the negotiations. A final decision on future strategic steps is expected by mid-February.

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