Honda, Nissan and Mitsubishi end their merger talks: Report

However, the three automakers will continue to work together on electric vehicles and smart cars, such as autonomous driving

Japanese automakers Honda, Nissan and Mitsubishi said Thursday they are dropping their talks for a business integration.

Makoto Uchida, president and CEO of Nissan Motor, and Toshihiro Mibe, Honda Motor president and CEO, attend their joint press conference in Tokyo, Japan March 15, 2024.

The automakers agreed to end their agreement regarding the consideration of the structure for a collaboration, their joint statement said.

Honda Motor Co. and Nissan Motor Corp. announced in December that they were going to hold talks to set up a joint holding company.

Mitsubishi Motors Corp. had said it was considering joining that group.

From the start, the effort had analysts puzzled as to the advantages to any of the companies, as their model lineups and strengths overlap in an industry shaken by the arrival of powerful newcomers like Tesla and BYD, as well as the move to electrification.

Details as to why the talks unraveled weren't immediately available.

Honda and Nissan initially said they were trying to finalize an agreement by June and set up the holding company by August.

The three automakers will continue to work together on electric vehicles and smart cars, such as autonomous driving, they said Thursday.

In recent weeks, Japanese media had various reports about the talks breaking down, citing unidentified sources. Some said Nissan balked at becoming a minor player in the partnership with Honda.

Honda is in far better financial shape and was to take the lead in the joint executive team.

Nissan reported a loss for the July-September quarter as its vehicle sales sank, prompting it to slash 9,000 jobs. At that time, Chief Executive Makoto Uchida took a 50% pay cut to take responsibility for the results.