Japanese automakers Honda and Nissan have announced plans to merge, creating the world's third-largest automaker by sales.
The companies announced that they signed a memorandum of understanding on Monday. Mitsubishi Motors, a subsidiary of the Nissan concern, has also agreed to join business integration talks. The Japanese automakers are lagging behind major rivals in electric car production and trying to cut costs and make up for lost time through mergers.
The merger could result in a behemoth worth more than $50 billion, based on the market capitalization of all three automakers. Combined, Honda and Nissan, Renault SA of France and smaller automaker Mitsubishi Motors Corp would gain a lot of scale. to compete with Toyota Motor Corp. and Germany's Volkswagen AG. It is known that Toyota has technological cooperation with Japan's Mazda Motor Corp. and Subaru Corp.
