Honda has provided more clarity regarding its potential merger with Nissan. While the merger has yet to be approved by regulators, recent statements from Honda executives shed light on what the company aims to achieve from this deal.
At CES 2025, Honda’s Director and Executive Vice President shared insights into the company’s strategic vision behind this collaboration.
Short-Term Benefits
One of the primary short-term benefits for Honda involves filling gaps in its vehicle lineup. According to Honda’s executive, Nissan has large-class vehicles that Honda currently lacks. The executive stated, “We are still discussing with Nissan how we will proceed in the short term, especially in the U.S. market.
Nissan has large-class vehicles that we don’t have, so if we can exchange some of these vehicles, that would be a benefit for us.”
This exchange could allow Honda to access Nissan’s large vehicles, such as the Armada and Infiniti QX80, to strengthen its offerings in the large SUV segment. The executive hinted that in the future, there might be opportunities to co-develop these vehicles, but for now, Honda is primarily interested in accessing existing models from Nissan’s lineup.
High-Profit Vehicles
Honda seems particularly interested in Nissan’s high-profit vehicles, especially large SUVs. Vehicles like the Infiniti QX80, which could be rebadged and marketed as a premium Honda or Acura model, are seen as highly profitable. The executive hinted at the possibility of introducing a new Acura model above the MDX, speculating a name like the “Acura GDX.”
These large SUVs represent a significant profit opportunity for Honda. The executive pointed out that development costs for these vehicles are already covered by Nissan, making it financially attractive for Honda to rebadge and market them under its own brands.
Software Sharing
Beyond vehicles, another significant benefit of the merger could be in the area of software development. Honda recently developed its new Asmo software, but collaboration with Nissan could further reduce development costs.
The executive highlighted that sharing software development efforts with Nissan would have a substantial financial impact. “If we could have Nissan’s collaboration, we could share the development costs,” he noted.
This partnership could allow both companies to reduce expenses and accelerate innovation in areas like vehicle connectivity and autonomous driving.
Existing Collaboration on EV Platforms
Honda and Nissan have already established a partnership to develop electric vehicle (EV) platforms together. This collaboration includes sharing electric motors, batteries, and other key components. The potential merger would build on this existing relationship by expanding cooperation to large vehicles and software development.
Why Honda Is Taking This Risk?
Honda’s willingness to pursue this merger can be attributed to Nissan’s current financial struggles. Nissan has introduced some promising new products, but the company remains in a precarious position. A Nissan executive recently stated that the company has only 12 to 14 months to survive without a major lifeline.
Honda appears to see this merger as a way to secure strategic assets from Nissan while helping to stabilize the struggling automaker.
However, there are still questions about whether the benefits outweigh the risks. Some industry analysts believe that Honda could have explored other partnerships, such as working with GM to access large vehicles like the Chevrolet Tahoe.
