Honda and Nissan to start talks on possible merger, report says

Honda Motor and Nissan Motor are preparing to start negotiations on a possible merger, which ultimately could be expanded to include Mitsubishi Motors, Japan’s Nikkei reported Tuesday. Such a deal would create an automotive rival to Toyota Motor that would effectively consolidate the Japanese auto industry into two camps. It would also provide Honda and Nissan with more resources to compete with larger peers after downsizing long-held global partnerships with other carmakers: France’s Renault SA for Nissan and General Motors for Honda.

The move toward a merger would follow a decision by the two companies earlier this year to work together on electric vehicle batteries and software. At that time, Honda Chief Executive Officer Toshihiro Mibe floated the possibility of a capital tie-up with Nissan..