[HN Gopher] How Nissan and Honda's $60B merger talks collapsed
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How Nissan and Honda's $60B merger talks collapsed
Author : comebhack
Score : 62 points
Date : 2025-02-12 16:32 UTC (6 hours ago)
(HTM) web link (www.reuters.com)
(TXT) w3m dump (www.reuters.com)
| bearjaws wrote:
| IMO a Honda Nissan merger would have been terrible for Honda.
|
| Nissan is clearly an anchor, and acquiring it would have just
| dragged Honda down .
| Grazester wrote:
| Funny that's what those Nissan CVT's and variable compression
| engines are only good for, anchors.
| red-iron-pine wrote:
| nah they're far too freakin fragile to be anchors, given how
| regularly they shatter or break
| VectorLock wrote:
| Its too bad since Honda has seemed to have totally lost its
| luster the past decade or so. Honda was Apple to Toyota's
| Microsoft for a long time, now their cars are bland and
| undifferentiated, rather than the innovative leaders they used
| to be.
| killerpopiller wrote:
| habe you seen the Honda e?
| olyjohn wrote:
| I could not understand why this merger was happening. What
| possible benefit was there for Honda to take on Nissan's cruft?
| mrguyorama wrote:
| This basically means Nissan is dying. It's finances are screwed
| right now, and this was essentially their last hope. Nissan may
| not survive the year.
| owlninja wrote:
| This made me think of the Nissan.com guy and am just now
| learning he passed in 2020.
|
| https://nissan.com/
| user3939382 wrote:
| Oh that's sad :( I was always rooting for him.
| encom wrote:
| As a Leaf owner, that has me worried :/
| morkalork wrote:
| I don't understand what went wrong here, for a while the
| Nissan Leaf was _the_ economical all electric sedan. Toyota
| was and still is dragging their feet on it and Nissan had a
| lead for years just to blow it?
| kenhwang wrote:
| For starters, the Leaf wasn't a sedan, it was a hatchback.
| In the US market, hatchbacks have always significantly
| lagged sedans in sales despite being more practical. The
| regular Prius has evolved to look sleeker and sportier with
| each generation, but the boxy hatchback Prius V variant was
| quickly discontinued after introduction due to poor sales.
|
| US consumer preference seems to weigh aesthetic appeal much
| more than other markets, even at the cost of function. Some
| other examples are the rugged boxy SUVs that have an
| aerodynamic/fuel economy penalty compared to their sleek
| blob counterparts, or the the coupe SUVs that sacrifice
| both rear headroom and storage capacity for a "sportier"
| look.
| r00fus wrote:
| Several things: hatchbacks do great if you size the up
| and call them "crossover SUVs" - see Mach-E, Ioniq 5,
| EV6, Ariya, etc.
|
| Also sedans do have a feature - less road noise than a
| hatchback.
|
| The Leaf failed because a) fast charger support was poor
| (Chademo vs DC fast or NACS) and slow. b) battery thermal
| management STILL isn't acceptable and results in
| degradation.
|
| We got one as a rental and it was really comfortable but
| I wouldn't buy it because of the above.
| olyjohn wrote:
| Nissan probably has already quit making parts for your car
| anyways. None of the automakers make parts a priority
| anymore. The aftermarket will keep your car afloat for a
| while.
| onlypassingthru wrote:
| I doubt the Japanese government will let Nissan fold and will
| instead invest directly, allow Foxconn to take over or some
| combination thereof. Losing the formerly mighty Nissan would be
| a big black eye for the government.
| vardump wrote:
| Both are likely dying. Small manufacturers have hard time
| moving to mass market EV age, even EV pioneering Nissan.
| wil421 wrote:
| They've had multiple quarters where sales dropped by 90%,
| they've been dying for over a decade.
| csours wrote:
| At this point I feel like a rising stock price after a crisis
| should be a major red flag for long term corporate survival.
|
| Carlos Ghosn was able to "turn Nissan around", but it was at the
| expense of future product capabilities (in my opinion)
| [Disclosure I work for GM, this is solely my own opinion]
|
| Also, I must say that it is not clear to me that anyone could
| know what a long term winning play looked like 10-15 years ago
| when the damage was done (in my opinion). It takes a lot of
| effort and money to make a mediocre automobile, it takes a lot
| more to make a high quality automobile.
| orwin wrote:
| Under Goshn and his close early advisors, Renault-Nissan
| started working on EVs, launching the Leaf and Zoe. Early, he
| also managed to streamline production of the two companies, and
| started to implement management changes that let some workers
| have more autonomy.
|
| The issue is that power got to his head and truly believe he
| was the second coming of Jesus or something, and stopped
| improving his companies to rub shoulders with the Nepo
| CEO/aristocrat crowd. Had he continued the push toward
| affordable EV, Nissan could have been BYD, but R&D stopped, for
| no visible reason.
|
| My personal theory is that the fallout from his divorce
| estranged him from his early friends and his closest advisor
| (his wife) and idiotic sycophants made him believe he was above
| the law and deserved even more. I've heard a lot of good things
| about pre-2008 Goshn, from people who aren't usually glazing
| billionaires, so maybe I'm biased.
| csours wrote:
| > My personal theory is that the fallout from his divorce ...
|
| Yes, I've noticed that people having nasty public fights with
| family members can lead to extremely negative effects on
| decision making.
| timewizard wrote:
| > At this point I feel like a rising stock price after a crisis
| should be a major red flag for long term corporate survival.
|
| It depends. If you see a lot of insider buying after a bottom
| it can be a good sign that there's strong internal faith in the
| companies future. I've used it as a buy signal myself before
| when a market cap is high enough. It has paid off.
|
| > it is not clear to me that anyone could know what a long term
| winning play looked like 10-15 years ago
|
| Well it probably _wasn't_ partnering with a Chinese state
| company to try to expand the brand there. That was a poison
| pill.
| tahoeskibum wrote:
| Nissan, Honda & eventually Toyota are going to go the way of
| Nokia/Motorola after iPhone came out. Cheap and reliable Chinese
| EVs will take over the market (like Android), while Tesla will
| probably maintain a halo premium product like iPhone.
| mongol wrote:
| Tesla is going down the drain, at least in Europe, unless
| shareholders evict Musk. Nothing iPhone-like with that brand
| anymore.
| hanszarkov wrote:
| Tesla makes great products.
| margalabargala wrote:
| Tesla has great battery and motor tech. Their quality
| control and car interiors leave a lot to be desired.
| user3939382 wrote:
| This sounds like political venting more than a financial
| analysis.
| margalabargala wrote:
| The parent specified in Europe. It's a fact that in January
| 2025, European Tesla sales have had significant YoY
| declines, attributed to Musk's political activity. A
| greater than 50% drop in sales in France and Germany, for
| example.
|
| Here are a couple sources.
|
| https://www.ft.com/content/ea2329e4-b4bc-4e2d-be34-e9a8ea31
| 1...
|
| https://www.nytimes.com/2025/02/05/business/tesla-germany-
| el...
| mongol wrote:
| "Tesla's sales plummet across Europe"
|
| Financial Times January 2025
|
| https://www.ft.com/content/ea2329e4-b4bc-4e2d-be34-e9a8ea31
| 1...
| rapsey wrote:
| Reddit is far from real life. Tesla is very popular in
| europe.
| Tagbert wrote:
| that has changed drastically recently. Big drops in sales
| in EU.
| rapsey wrote:
| And have other EV makers seen more success or have they
| all had declines?
| r00fus wrote:
| Other EV manufacturers are essentially picking up the
| lost sales and the EV market as a whole is up marginally.
|
| https://evmagazine.com/news/teslas-european-decline-
| musks-ev...
| mongol wrote:
| I live here. This sentiment is everywhere
| r00fus wrote:
| Not just Europe: CA sales are down double digits recently as
| well: https://www.newsweek.com/tesla-california-sales-
| decline-elec...
| margalabargala wrote:
| Tesla gained a reputation of being the best EVs around, by
| virtue of being essentially the only company making EVs able to
| truly replace a gas car for close to a decade. It's easy to be
| the best in a category with just one competitor.
|
| Now that other companies are making EVs that compete directly
| with Tesla, they aren't reliably best-in-class or best-in-
| price-point anymore. Compare the Rivian R1T to the Cybertruck,
| or the Equinox EV to the Model Y, or the Ioniq 6 to the Model
| 3. The top of the line Model S still doesn't really have any
| viable competitor.
|
| Tesla has phenomenal battery and motor tech, but their actual
| car design leaves a lot to be desired, and that's starting to
| hurt them now that they aren't the only game in town.
|
| And the fact that their CEO throws Nazi salutes at political
| rallies does not help their market share. In Europe at least
| that's directly impacting their sales.
| jgon wrote:
| So your prediction is that chinese EVs manage to take over and
| destroy the Japanese car market, but the American auto market
| somehow gets a pass and Tesla wins? Why would Tesla be any more
| able to withstand cars that cost like 1/2 for similar quality,
| and why wouldn't that same calculus apply to their "halo"
| products? Are the Chinese fundamentally incapable of building a
| luxury EV? And if Tesla somehow sees that an EV halo product is
| their only chance for survival, why wouldn't current halo
| manufacturers like BMW and Mercedes and Lexus also try for that
| market, and why are they sure to fail while Tesla succeeds?
|
| And maybe your response to all of the above is that Tesla will
| not be allowed to fail as part of an industrial strategy on the
| part of America, in which case the question is why would the
| other domestic manufacturers like Ford and GM be allowed to
| fall by the wayside? And further, why would Japan not also
| embark on a similar strategy and prop up their domestic
| manufacturers?
|
| Any way you look at it, a prediction that China wins out
| everywhere except for plucky old Tesla moving into the "Apple"
| position seems like some sort of bizarre partisanship/home team
| support that doesn't stand up to a moment of scrutiny.
| llm_nerd wrote:
| I have _huge_ doubts that Teslas will retain a "halo premium",
| except in some very strange circles. Already they're an
| embarrassing car to own and the financials of that company are
| rapidly flushing down the toilet, making it a question of how
| long it will be a going concern (hence all the frantic rushing
| around for legitimacy in other markets...robots, why not?)
|
| They are widely cited as unreliable, poorly built vehicles. My
| neighbour bought a used model S and the first time he saw us
| after buying it he came over to justify his purchase ("Got a
| killer price, etc").
| silisili wrote:
| > Already they're an embarrassing car to own
|
| I don't know if that's true, but I find it all pretty funny
| regardless.
|
| Five or more years ago, people hated Tesla drivers, either
| because they represented wealth or that they were seen as
| progressive 'tree huggers'.
|
| Today people seem to hate Tesla drivers because the brand is
| for right wing nazis.
|
| I think both takes are misguided, and I don't know how
| popular those takes are, but I can't help but finding the 180
| humorous.
|
| For context, I'm not taking a side and don't have a strong
| opinion either way. I don't own and wouldn't own one, but for
| reasons with nothing to do with politics or quality.
| llm_nerd wrote:
| Did people really hate Tesla drivers? Aside from an
| extremely niche "rolling coal" sort, they were just a car.
| An innovative car that had downsides, but also had big
| upsides like insane torque and big screens (which were odd
| at the time, but pretty normal now). They were _neat_ to
| tech sorts.
|
| And notably the average loaded pickup truck -- the kind
| that fill every highway and road -- is more expensive than
| the average Tesla, so I don't think it has ever represented
| wealth, and the "people are jealous" thing has always been
| rather silly. One of the most common situations to see
| Teslas today are delivery vehicles and Ubers.
|
| The honeymoon has worn off, though, and the blindness to
| the many design and build flaws of the vehicle, or the
| extremely anti-consumer behaviour of that company, has
| earned it a public sentiment that has declined. Now add
| that it is the primary wealth vehicle for one of the worst
| people on the planet, such that it started transitioning
| into pandering to let's call them bad people (the
| CyberJunk), and it's just a nameplate carrying a lot of
| negativity now.
|
| >but I can't help but finding the 180 humorous.
|
| The both-sidism thing is so incredibly boring. If everyone
| else didn't start making pretty good EVs, Tesla kept
| iterating and making better products with better quality
| and dealing with their customers better (instead of making
| ridiculous nonsense like their useless truck or robots or
| whatever else), and it wasn't associated with bankrolling a
| _garbage_ huamn being, it would still be a beloved brand.
| But it isn 't 2019 anymore.
| solatic wrote:
| Honda is bigger than just automobiles, they also hold the
| lion's share of the two-wheeler market (motorcycles, scooters).
| They're a far way from dead.
| holtkam2 wrote:
| Honest question: are there people who know about Lucid and
| don't consider them nicer cars than Teslas?
|
| Tesla doesn't make a car as nice as the Air Sapphire... I don't
| think they could if they wanted to. So they're forced to stay
| in the less expensive / less quality market segment
| alecco wrote:
| Japanese carmakers are going to become irrelevant [1] unless
| there's a major change. But that's very unlikely due to:
| 1. Supply chains and key raw materials mostly controlled by China
| 2. Japan's demographic collapse 3. Japanese Gen Z fed up
| with an unwinnable rat race where they live to just pay rent and
| groceries
|
| It's very sad.
|
| [1] https://carnewschina.com/2025/01/13/byd-surpass-toyota-in-
| ja...
| formerly_proven wrote:
| There's one graph that basically predicts which countries are
| going to fail and which are going to prevail. It's the graph
| that shows how many people in the "doing things" age bracket a
| country has.
|
| Compare these:
|
| (germany)
| https://population.un.org/wpp/graphs?loc=276&type=Probabilis...
|
| (alternatively, Europe as a whole)
| https://population.un.org/wpp/graphs?loc=908&type=Probabilis...
|
| (Japan)
| https://population.un.org/wpp/graphs?loc=392&type=Probabilis...
|
| (China)
| https://population.un.org/wpp/graphs?loc=156&type=Probabilis...
|
| to this one
|
| (US)
| https://population.un.org/wpp/graphs?loc=840&type=Probabilis...
|
| A key aggravating factor is most countries in the first group
| have stagnating productivity and the country in the second
| group has raising productivity on top. This creates a compound
| advantage for the country in the second group.
|
| It seems likely to me that there is almost no degree of anti-
| national behavior the government of that country would need to
| exhibit or no amount of country-eroding policies that could
| forfeit this fundamental advantage. They'd need to get their
| country _literally_ nuked or something similarly catastrophic.
| morkalork wrote:
| Canada doesn't feel like it's winning despite what the graph
| says*. Bringing in tons of working-aged immigrants has caused
| housing (and other living) costs to explode, which in turn
| has lead to less people having children, which leads to more
| immigration to fill the gap and the whole thing has been
| spiraling. Not fun at all.
|
| * https://population.un.org/wpp/graphs?loc=124&type=Probabili
| s...
| cayleyh wrote:
| The problem with just "living by the graph" is that it
| ignores whether the country has the capacity to provide
| basics like food, clothing, shelter, and employment to the
| population. You need to have both to have the working-age
| population be able to engage productively in the economy.
|
| The problem Canada created is that it tried to reset it's
| population graph without ensuring that there was an
| adequate supply of said basics, and in many instances
| (housing, food prices) had policies that actively
| undermined what needed to a happen to support a rapidly
| expanding population. JT and the other liberal leadership
| read the Century Initiative and all they took away as "we
| need 100m people!"
| (https://en.wikipedia.org/wiki/Century_Initiative)
|
| It's not that a country couldn't _theoretically_ be
| successful resetting their population graph through
| immigration, but that they would also have to do things
| that would cause housing prices to fall or more competition
| (ie less corporate profits) in the other sectors to absorb
| the extra demand generated -- 2 things Canada has been
| absolutely unwilling to do in any meaningful until late
| last year.
| greenavocado wrote:
| Canada is a Calhounian behavioral sink except they stave
| off the extinction by importing.
|
| Summary with links to various publications at the end:
| https://notwokedot.com/wp-content/uploads/2024/07/The-
| Behavi...
| thomassmith65 wrote:
| Immigration is no excuse for the Canadian housing shortage.
| Canada is one of the world's largest land masses, and -
| even in its South - mainly uninhabited.
| petra wrote:
| Assuming a decent AI and robotics, is a lot of working age
| population still a good thing? Or just more mouths to feed?
| mrtksn wrote:
| What happens when a country fails?
| denkmoon wrote:
| We need only to look to Sudan, Somalia, et al.
| vpribish wrote:
| not often a comment here makes an impact like that. wow -
| holy crap.
| alecco wrote:
| It is an important variable. But a more realistic picture
| needs to factor in: 1. median IQ 2.
| skills 3. future unfunded liabilities (welfare,
| pensions, public health, etc)
|
| China has demographics collapse like the West but they have
| high median IQ, high skills, and almost no unfunded
| liabilities. Meanwhile, Western IQ and skills are dropping
| like a stone and they have trillions in unfunded liabilities.
| And any attempt to fix it is either a drop in a bucket or
| going to trigger massive unrest. Just see what happened in
| France a year ago.
|
| I hope China learns this lesson an makes some changes. At
| least they have a bit more runway to do so.
| onlypassingthru wrote:
| Irrelevant to whom? Toyota, Honda and Subaru all have lifelong
| customers and for good reason. The cars often last for 20+
| years with minimal upkeep.
|
| The current crop of Chinese electric car makers are all trying
| to fake it until one of them makes it and the money spigot
| keeping them afloat will eventually get turned off at some
| point.[0] Good luck keeping that flashy EV running when the
| company goes bust.
|
| [0]https://www.businessinsider.com/chinese-evs-losses-widen-
| des...
| potato3732842 wrote:
| All cars last 20+yr if you give a crap unless they have some
| fundamental engineering or execution Achilles heel (ecoboost
| water pump, Toyota frame rust, Hyundai engine problems, etc)
| that will manifest as a comically not-economical repair when
| the vehicle is old enough in age to be of fairly low value.
|
| Premium cars that aren't so premium as to be disposable (i.e.
| not a luxury car you're gonna trade in every 3-5yr like
| clockwork) always last really well because people who can
| afford nice things can generally afford to maintain them.
|
| This is pretty clearly borne out when you compare same cars
| across brand e.g. Ford Lincoln Mercury panther platform cars)
| or look at the exceptions like all those objectively terrible
| northstar caddilacs and v12 Jags and whatnot that are in
| impeccable shape because they got used and maintained nicely
| for a decade before being "retired" to the garage of the
| owner's vacation property on Cape Cod or perhaps the Hamptons
| or compare airport people moving vans that were retired to
| church group service to work vans that got sold down the
| river to even harder service.
|
| It's really easy to "well we really should sell a water pump
| while we're in here for your 100k timing service" on a Subaru
| owned by someone who can afford a Subaru vs selling a
| preventative transmission fluid change to the guy who could
| barely scrape together the down payment on a Sentra.
|
| I'm being a little sloppy and leaving some loose ends and
| room for nitpicking jerks to wedge in but I think the point
| here is pretty clear.
| r00fus wrote:
| Amazing you feel that EVs are somehow more maintenance than
| ICEs. There exist EVs that have never had any
| manufacturer/dealer input since the day they rolled off the
| lot.
|
| Tesla/Nio are a bad examples - many EVs were built to be sold
| and essentially ignored by the manufacturer.
| onlypassingthru wrote:
| After that EV company goes out of business, how are you
| going to replace that bespoke {$random_part} that broke?
| Any Fisker Ocean owners want to chime in?[0]
|
| [0]https://en.wikipedia.org/wiki/Fisker_Ocean
| dkjaudyeqooe wrote:
| Never mind the parts, how do you get your firmware
| updated without being held hostage?
| r00fus wrote:
| You don't. You buy from a large vehicle manufacturer like
| Ford, Kia, etc. where they have commitment to parts
| delivery for the foreseeable future.
|
| Fisker was always a scam if you remember back from days
| of Fisker Karma.
| olyjohn wrote:
| Do the big companies really have a commitment to parts
| delivery anymore, or are they following the same trend?
| Took my friend 9 months to get a part for his C8 Corvette
| when it got rear ended at 5mph. Tons of other GM owners
| have been waiting months to nearly a year for many common
| parts for repairs. Selling parts doesn't make these
| companies money, so why should they care? As long as
| they're making enough to sell the new cars first.
| tpm wrote:
| They have lifelong customers, but those also don't live
| forever and can change their opinion, and if the carmakers
| don't adapt, they won't survive. For the last 19 years we
| have been buying Toyota, but I'm slowly starting to look for
| a new car and it has to be an EV and Toyota is currently very
| underwhelming in that regard in our market.
| alephnerd wrote:
| While this is HN so any automotive conversation inevitabely
| becomes an ideological war between EV vs ICE fanatics, this
| didn't play as significant a role in the failure of Nissan and
| Honda's merger.
|
| As stated in the article - "the merger talks unravelled in a
| little more than a month due to Nissan's pride and insufficient
| alarm about its predicament"
|
| More critically, Japanese automakers have always tried to
| diversify away from Japan as part of the "Flying Geese" paradigm.
|
| For example, Toyota and Honda truly became "American", Mitsubishi
| truly became "Southeast Asian" (Indonesia, Philippines, Thailand,
| Vietnam), Isuzu became "Thai", and Suzuki became "Indian".
|
| Nissan on the other hand tried a foreign expansion with the
| Datsun in the 1960s-80s, but that crashed and burned horribly,
| and reduced their appetite to expand abroad.
|
| Post-Datsun, most of their international expansion tied their
| future to Brazil, China, and India as part of the Renault-Nissan
| partnership under Carlos Ghosn, but that itself came very late
| (early 2000s) and other players (domestic, international, and
| Japanese) were well established in those markets already.
|
| Furthermore, Nissan Group's prestige division Nissan Shatai is
| too entwined politically to Kyushu, which scuttled the merger as
| Honda would have shut down Nissan's Kyushu factories which
| represent much of Nissan's capex.
|
| Fundamentally, Nissan's leadership has a low appetite of taking
| risks abroad after the failure of Datsun, and this would have
| been toxic for an internationally minded Japanese firm like Honda
| who has stronger PMF abroad compared to domestically in Japan.
| Apocryphon wrote:
| What about Mazda?
| Reubachi wrote:
| TLDR; Mazda should merge with Nissan while they still can do
| it on a fire sale.
|
| Mazda is a huge outlier in manfacturing because they are
| small, but have motorsports calibre/history (meaning they
| have a history of homologating sports cars.)
|
| Mazda sells an order of magnitude less cars than even newer
| companies like BYD. Even less than isuzu. Because of this,
| they can more tightly control investor expectations,
| profit/loss. The stock value rarely changes, nevermind grows,
| so investors are confident in stability and dividends.
|
| AKA, if you work at mazda, you aren't gonna be seen as a mega
| rich engineer. If you invest in mazda, you know you're gonna
| be able to sell at any point without much worry.
|
| That said, I see no future for mazda beyond acqusition by
| chinese firm. It Manufactures in far too high COL countries,
| sells for too cheap, Self cannabalizing (9 different SUV
| models), too tight of a CUV market, lack of brand
| identity.....and the biggest issue, they cannot afford to r
| and d another miata gen, another RX-7,8 gen.
|
| mazda desperetely needs a cash infusion, or joining into a
| much wider network with more selling power. Until then, I
| fear they will coast down the same road as Mitsubishi in the
| us.
| laurencerowe wrote:
| Mazda seems to be doing pretty well selling SUVs in the US
| though with growing sales and its highest US market share
| since 1990.
|
| https://www.automotivedive.com/news/mazda-boosts-us-
| market-s...
| Clamchop wrote:
| That's been my impression, interesting to see it
| confirmed. They are very well represented on the roads
| here in SoCal.
|
| They manufacture a lot in Canada and Mexico, though. I
| guess we'll find out what current events have in store
| for them and others.
| zenlot wrote:
| You got it all wrong on Mazda. It's your opinion, but not
| publics and they're doing damn well now, especially with
| their great recent SUVs.
| alephnerd wrote:
| US.
|
| Mazda is also minority-owned by Mitsubishi Group and Toyota
| Group and co-owns plenty of plants with Toyota, so it's a
| different story from Nissan Group which retains independence.
|
| At this point, Mazda is an OEM for Toyota Group, and
| previously they were an OEM for Ford.
| numpad0 wrote:
| This merger deal was a strange one. Honda CEO on stage wasn't
| sure why he was there, unnamed Nissan exec reportedly remarked
| "good riddance" to the deal falling through, ex-Nissan Foxconn
| exec expressing interest and Foxconn CEO eventually declining
| through the press, and so on.
|
| Whoever was pushing it for whatever reason, basically none of
| involved parties were interested in it, other than that everyone
| agreed that hypothetically combining Nissan and Honda would
| create some accumulated capitals.
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