Soon, Honda and Nissan could be in a tree, K-I-S-S-I-N-G. In this story, Nissan is the damsel in distress and could go out of business. However, Honda could be the knight in shining armor that comes to save the day with a potential merger. 

Honda and Nissan discuss a possible merger 

It’s official, Honda and Nissan might build a significant relationship together. A collaboration could be exactly what Nissan needs to get back on its feet. 

A massive sales decline has provided an uncertain future for Nissan. While the company isn’t going out of business yet, things aren’t looking well. It is in a critical situation and has about 12 to 14 months to financially recover. 

Nissan believes the slowing sales are due to its lack of hybrid engines. Meanwhile, Toyota’s hybrid vehicles have been gaining popularity. 

To save money, Nissan cut 9,000 jobs and reduced production capacity by 20%. This move came after a quarterly loss of $9.3 billion. Its Chief Executive, Makoto Uchida also took a 50% pay cut to take responsibility for declining finances. 

According to AP News, this isn’t the first time Honda has helped Nissan. In August, the automakers agreed to share components for electric vehicles, such as batteries and software. 

If they join forces to work on hybrid and gas-powered vehicles then the conglomerate could be worth $55 billion. Plus, Honda experienced a 20% sales decline in the first half of the fiscal year, so it also needs a little help. 

Teaming up would help the Japanese automakers scale up to compete against Toyota and Volkswagen. Toyota is Japan’s market leader and the Toyota RAV4 is notorious for outselling the Honda CR-V and Nissan Rogue. 

Nissan’s share price has experienced a significant drop, making it a bargain for Honda to potentially take advantage of. Nothing is official yet, but the automakers are discussing a merger and growing partnership.