A month after the merger of two automotive giants seemed like a done deal, the proposed arrangement between Honda and Nissan is now dead in the water. The $60 billion merger would have created the fourth largest automobile company in the world behind Toyota, Volkswagen Auto Group and Hyundai-Kia. It was seen as a necessary move to compete with the dominance of Chinese EVs in the market. But Nissan's future now lies in the balance after walking away from what many perceived as a lifeline Honda offered it. Why is Nissan in trouble? Honda changed merger terms; wanted Nissan as subsidiary Whilst Nissan felt it was going into the merger as an equal with Honda, it became clear that wasn't quite the case. The two brands have a century-old rivalry in the world of Motorsport. So, upholding pride against a 'rival', may have swayed Nissan's board who's egos were bruised when Honda overtook it as Japan's second biggest carmaker behind Toyota in 2020. Since then though, Nissan's woes got worse and its operating profit fell from ₹321.88 billion in FY2023 to ₹18.62 billion in FY2024. Honda was seen as rescuing Nissan in a deal the latter would be crazy not to take. But when Honda proposed a change in the terms of the merger, asking that Nissan become its subsidiary, instead of a 50-50 partnership; Nissan's pride and grand history simply would not give way. Nissan unwilling to cut jobs, close factories Nissan shareholder Renault was resistant to the deal Nissan is part of a three-way alliance called 'Renault-Nissan-Mitsubishi'. It is a unique deal in the automotive world where the trio are technical collaborative partners but instead of forming a single company, own stakes in each other. Renault and Nissan own 15% voting shares in each other. Renault claimed the merger would result in a "takeover of Nissan by Honda without a control premium for Nissan shareholders". Renault found this unacceptable, saying it would "vigorously defend" its interests. What is Nissan's future? Both Honda and Nissan have walked away from the merger, but they may yet agree to a technological collaboration. Nissan has expressed interest in working with new partners for its future. Prominent among those is Foxconn, a Taiwanese manufacturing company that produces Apple's iPhones, Foxconn Chairman Young Liu said on Wednesday that its aim was to cooperate with Nissan, not acquire it. Foxconn, led by former Nissan executive Jun Seki, wants a name and face to launch its EV business and Nissan provides just that. Meanwhile, motoring enthusiasts will hope that becoming yet another mass producer of dull, soulless EVs is not the future of an iconic brand that birthed marvels of the car industry like the Skyline GTR, 240Z and Silvia.Original Article