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Two of Japan's auto giants,TV Movie Archives Nissan and Honda, are reportedly in early talks to merge, according to The Nikkei, in a bold move to strengthen their position against China’s growing clout in the electric vehicle (EV) market.

While no concrete plans have emerged yet — and both companies remain tight-lipped on the subject — Japanese broadcaster TBS suggests that an official announcement of these discussions could come as early as next week.

Back in March, Nissan and Honda signaled their willingness to collaborate by agreeing to explore a strategic EV partnership. But, as the BBC points out, a full-blown merger of two of Japan’s automotive heavyweights would send ripples through both the political and economic landscape — a merger risks jobs and partnerships with other companies like French manufacturer Renault.

According to the BBC, Honda and Nissan have been steadily losing ground in China, a market that represented nearly 70 percent of global EV sales as of November. Despite their combined global sales of 7.4 million vehicles in 2023, both brands are struggling to hold their own against cost-effective EV Chinese manufacturers like BYD.

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