Nissan-Honda Merger Talks Collapse

Nissan has reportedly called off merger talks with rival Honda, abandoning a potential $60 billion-plus tie-up that would have created the world's third-largest automaker. The talks were complicated by growing differences, particularly Honda's proposal for Nissan to become a subsidiary, which Nissan rejected as a departure from a merger of equals. Following the news, Nissan's shares slid more than 4% on the Tokyo Stock Exchange, while Honda's shares rose over 8%, indicating investor relief. This development raises questions about Nissan's ability to execute its turnaround plan, which includes cutting 9,000 employees and 20% of global capacity, without external assistance. Nissan has been particularly affected by the shift to electric vehicles and has not fully recovered from the 2018 crisis involving Carlos Ghosn. The potential tariffs from Donald Trump against Mexico also pose a greater risk to Nissan than to Honda or Toyota. Nissan's long-term alliance partner, Renault, had expressed openness to the merger but would defend its interests.