According to Kyodo News citing sources, Nissan Motor’s President informed Honda Motor on Thursday of the company’s intention to terminate merger talks, marking the end of an initiative that could have established the world’s third-largest automotive group.

If Nissan’s decision to terminate merger talks with Honda is finalized, it could pave the way for Foxconn to pursue a potential acquisition of Nissan, as indicated by MoneyDJ, citing Nikkei.

The MoneyDJ report highlights that dissolving the memorandum of understanding (MOU) between Nissan and Honda would eliminate significant barriers that have previously restricted Foxconn’s ability to move forward with an acquisition.

Several scenarios could unfold following the termination of the merger discussions, as indicated by MoneyDJ. One possibility is that Foxconn may take a cautious approach, closely monitoring Nissan’s situation while positioning itself as a potential financial backer if needed. Alternatively, Foxconn could choose to move forward with a direct acquisition.

Notably, the MoneyDJ report suggests that a collaboration between Foxconn and Nissan could lead to the creation of a powerful EV supply chain in Asia. Foxconn, which actively invests in EV development and in-house production of key components, shares a strategic alignment with Nissan. Additionally, the report points out that partnering with Foxconn, known for its expertise in contract manufacturing, could help Nissan make better use of its excess production capacity.

According to TrendForce, EVs are projected to account for approximately 25% of global new car sales in 2024. Although the growth rate of the global EV market has slowed, the overall upward trend remains intact. Global EV sales are expected to reach 26 million units by 2025, capturing nearly 30% of total new car sales.

(Photo credit: Foxconn)

TrendForce 2024 Global Automotive LED Market- Lighting and Display Product Trend
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