The possible merger between Honda and Nissan, revealed by the Nikkei newspaper, marks a decisive turning point in the reorganization of the Japanese automobile industry, under pressure from giants like Tesla and Chinese manufacturers. But this initiative is not limited to a domestic issue. For Renault, a key shareholder of Nissan, this operation could open up new strategic perspectives.
Ongoing discussions between Nissan and Honda envisage the creation of a holding company, possibly with the integration of Mitsubishi Motors, of which Nissan holds 24%. With a combined capitalization of nearly $54 billion, such an entity would be on par with behemoths like Stellantis, formed by the merger between Fiat Chrysler and PSA.
This merger aims to strengthen competitiveness against Toyota and catch up in the areas of electric vehicles (EV), artificial intelligence and software. However, analysts like Seiji Sugiura of Tokai Tokyo Intelligence Laboratory note that cultural and technological integration between Honda and Nissan could be an obstacle, especially in an industry experiencing rapid change. Some rumors in the corridors suggest that discussions between Nissan and Honda have accelerated after a marked interest in Nissan from the Taiwanese Foxconn (Hon Hai Precision).
The impact on Renault
According to Philippe Houchois, analyst at Jefferies, this potential merger between Honda and Nissan would be largely positive for Renault. It identifies several benefits for the French manufacturer.
First, the revaluation of Renault’s assets, since the rise in the Nissan share price, combined with a possible sale of Renault shares available for sale in the Japanese manufacturer (18.7% of the capital), could generate 1.33 billion euros. This divestment would strengthen Renault’s liquidity while offering it increased financial flexibility.
Then, the strategic holding in the new entity, if the participation was not sold. In the event of a merger, Renault’s stake in the new group (Honda-Nissan-Mitsubishi) would be reduced to around 5.8%. However, this would allow Renault to maintain strategic influence while alleviating the financial constraints linked to too large a stake.
Finally, industrial cooperation could continue. Despite a reduction in its participation, Renault could continue to collaborate with Nissan, in particular through subcontracting and joint projects on EV technologies and software. This cooperation would be particularly valuable as Honda has ceased production in Europe.
However, the scenario is not without risks. Renault could find itself in a minority position without leverage in the new entity, limiting its ability to influence strategic decisions.
An opportunity to redefine the Renault-Nissan Alliance?
This situation could also be an opportunity for Renault to rethink the Alliance, which has been under pressure for several years. As Philippe Houchois points out, a possible exchange of shares or a reconfiguration of cross-shareholdings could allow Renault to strengthen its financial structure, while refocusing its efforts on strategic markets such as Europe and Latin America.
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