Three of the biggest car brands in the world have unveiled plans to merge, which would create the third-largest automaker by sales, despite criticism from some in the automotive industry.
Honda and Nissan have signed a memorandum of understanding alongside Mitsubishi to talk about the possibility of integrating businesses.
The Japanese firms said it would involve "participation, involvement, and synergy sharing in relation to the business integration through the establishment of a joint holding company".
Nissan and Honda signed a memorandum of understanding in August which focused on the development of technology and electrification.
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Nissan and Honda have unveiled plans to merge and create one of the world's best-selling brands
REUTERS
The agreement outlined future plans to move towards a business integration through the establishment of a joint holding company.
It highlighted that this was necessary given the "dramatic changes" in the automotive industry, with many pointing to the move to zero emission vehicles and the growing influence of Chinese brands.
Mitsubishi Motors aims to reach its conclusion by the end of January 2025 on the participation or involvement in the business integration between Nissan and Honda.
Makoto Uchida, Director, President, CEO and Representative Executive Officer of Nissan, said the business integration would involve partnerships in a wide range of fields.
He added: "It is significant that Nissan's partner, Mitsubishi Motors, is also involved in these discussions. We anticipate that if this integration comes to fruition, we will be able to deliver even greater value to a wider customer base."
Similarly, Toshihiro Mibe, Honda Director and Representative Executive Officer, praised the talks, saying it would lead to "further social change".
The 63-year-old said: "At this time of change in the automobile industry, which is said to occur once every 100 years, we hope that Mitsubishi Motors' participation in the business integration discussions of Nissan and Honda will lead to further social change, and that we will be able to become a leading company in creating new value in mobility through business integration.
"Nissan and Honda will start the discussion from today onwards with an aim to clarify the possibility of business integration by around the end of January in line with the consideration of Mitsubishi Motors."
Makoto Uchida and Toshihiro Mibe held a joint press conference on their merger talks this morning
REUTERS
According to Reuters, the merger between Honda and Nissan would aim for combined sales of 30 trillion yen (£152billion) and operating profit of more than three trillion yen (£15.2billion).
Reports suggest that the merger talks could conclude by June 2025, with an ultimate goal of setting up a holding company by August 2026.
Speaking shortly before the joint press conference, Carlos Ghosn, former Nissan chairman, said the alliance would not be successful, even describing it as "desperate", adding that Nissan was in "panic mode".
Many have attributed Nissan's issues to the embattled former chairman after he was arrested in Japan for financial wrongdoing before a dramatic escape to Lebanon in 2018.
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Carlos Ghosn has been critical of the potential merger between Nissan and Honda
PA
The merger would create the third-largest automaker, falling just behind Toyota and Volkswagen.
Takao Kato, Director, Representative Executive Officer, and President and CEO of Mitsubishi Motors said: “In an era of change in the automotive industry, the study between Nissan and Honda about a business integration will accelerate synergy maximization effects, bringing high value also to the collaborative businesses with Mitsubishi Motors.
"In order to realize synergies and to make the best use of each company's strengths, we will also study the best form of cooperation."
