) are in talks to deepen ties, two people said on Wednesday, including a possible merger, the clearest sign yet of how Japan's once seemingly unbeatable auto industry is being reshaped by challenges from Tesla and Nissan would create a $54 billion company with annual output of 7.4 million vehicles, making it the world's third-largest auto group by vehicle sales after
"This deal appears to be more about bailing out Nissan, but Honda itself is not resting on its laurels," said Sanshiro Fukao, executive fellow at Itochu Research Institute."Honda's cash flow is set to deteriorate next year and its EVs haven't been going so well." The companies are also discussing the possibility of full merger, according to one of the people, as well as looking at ways to cooperate with Mitsubishi Motors 's iPhones and has been seeking to expand its nascent EV contract manufacturing business, approached Nissan about a bid but it was rejected by the Japanese firm, two separate sources familiar with the matter said.
"Constructive rivalry with Toyota is a positive for the rather stagnating Japanese car industry when it must compete with Chinese automakers, Tesla and others."
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