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Honda, Nissan were targets for merger in Japan, report says

Some Japanese officials wanted the two automakers to merge, but both companies swiftly rejected the idea, according to a report.

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Both companies rejected the idea right away, according to this report.

Honda

In the wake of Nissan's shaky alliance with France's Renault and the drama surrounding ex-CEO Carlos Ghosn, some Japanese officials were so concerned for the automaker they sought a merger with Honda, the Financial Times reported Sunday.

Sources speaking to the publication who are familiar with the frankly wild discussions said Japanese government officials brought the idea to Nissan and Honda in an effort to address two problems with the country's domestic automakers. Nissan had long been in trouble, and according to the sources, officials were frightened the Renault-Nissan Alliance could dissolve altogether. As for Honda, officials reportedly remain wary of Japan's third-largest automaker as rivals merge and consolidate. Honda is completely independent from other companies, though it has partnered with General Motors on various electric car and fuel cell projects. The work is nowhere near interlocked as the upcoming PSA-FCA merger, however.

A combined Nissan and Honda would solve both of these worries, officials reportedly felt. However, sources told the publication that both automakers quickly dismissed the idea and any follow-ups were pushed to the side as the coronavirus pandemic started to take hold globally.

One former Nissan executive told the Financial Times the merger simply wouldn't make sense from a structural standpoint and said there'd be little to gain from such a move for either company. The person pointed to major differences in engineering, which would make it incredibly difficult to boost economies of scale by sharing parts.

Honda declined to comment for this story and Nissan didn't immediately return a request for comment.

While the idea of such a merger appears to be far-fetched, both automakers soldier on. As for Nissan, it's hoping for a mighty turnaround as it slashes nameplates globally and refines its focus on core countries. It also has numerous new Nissan vehicles coming in the next 18 months.

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