Honda-Nissan combined entity could generate over 3 trillion yen in annual revenue: Honda CEO Toshihiro Mibe

The business integration of Honda Motor Co and Nissan Motor Corp is likely to result in a company that will be the third largest automaker in the world in terms of vehicle sales. The combined entity has the potential to generate annual revenues of over 30 trillion yen and an operating profit exceeding 3 trillion yen, according to Honda Motor Director, President and Representative Executive Officer Toshihiro Mibe.

This financial projection reflects the scale and scope of the collaboration under consideration, highlighting the anticipated efficiencies, synergies, and advancements resulting from a consolidated strategy.  In the financial year ended March 2024, Honda Motor clocked 20,428.8 billion yen in total revenue and an operating profit of 1,381.9 billion yen. On the other hand, Nissan reported a total revenue of 12.686 trillion yen and 568.7 billion yen in operating profit.

While announcing the MoU between the companies, Mibe noted that financial outcomes are not sole objectives of the potential integration. The overarching aim, he said, is to create a robust structure capable of addressing emerging challenges in energy management, communication systems, and future mobility.  The business integration discussions will explore synergies in R&D, vehicle platforms, and regional operations to enhance brand power and operational efficiency.

“As a result of a series of dialogues, we discovered that the synergy potential from business integration is greater than anticipated. At the same time, the top management of the two companies came to understand more that mobility will no longer be differentiated by traditional hardware, and will undergo a significant evolution mainly driven by vehicle intelligence and electrification given the ongoing significant transformation of our industry,” Mibe said.

Honda and Nissan expect to sign a definitive agreement in June 2025 and establish the holding company. Once the definitive agreement is concluded, the holding company will be incorporated and listed on the Tokyo Stock Exchange in August, while the two subsidiaries will be delisted. Mitsubishi is also involved in the talks to explore participation or involvement in the consideration of business integration and has signed an MoU.

Mibe clarified the purpose behind the MoU is to create a framework for the exchange of confidential information and establish guidelines for structured discussions on integration. He highlighted that the automotive industry is undergoing a significant transformation, driven primarily by two key forces: electrification and vehicle intelligence.

Electrification, he explained, represents a shift in energy management within vehicles, while vehicle intelligence is transforming communication infrastructure and in-vehicle technologies. These two elements, according to Mibe, are fundamentally reshaping the future of mobility.

While Honda and Nissan have previously collaborated on specific projects, Mibe noted that their discussions revealed the limitations of isolated partnerships in narrow domains. The growing scale of technological advancements and infrastructure needs requires deeper integration to achieve meaningful outcomes. Discussions between Honda and Nissan identified significant areas of synergy, extending beyond traditional cost-saving measures or operational efficiencies.

One key area of focus is high-capacity batteries, which are not only essential for powering electric vehicles but also have applications in residential energy storage systems and power grid integrations. Another promising area is advanced onboard software and computing technologies, which could find applications outside the conventional automotive sector. According to Mibe, achieving these outcomes efficiently depends on scale, which a collaboration between Honda, Nissan, and potentially Mitsubishi could provide.