Honda and Nissan Are Planning a Major Alliance in the US: Shared Platforms and Engines?

After ruling out a merger, the Japanese giants resume talks. They seek large-scale collaboration to tackle new tariffs and the cooling EV market.

The two major Japanese brands, Honda and Nissan, are drawing closer again. Months after calling off merger talks, the automakers plan to team up to develop cars and powertrains for the US market.

Tariffs and the New Market Context

Nissan’s new CEO, Ivan Espinosa, has been clear. The goal is not another “corporate speed-date” that could lead to a permanent marriage. Nevertheless, they are looking for something more fluid. Therefore, the objective is to collaborate in the US. This would include joint product development and shared powertrain projects. Espinosa described the talks as “very constructive, very positive.”

The main motivation for working together is market pressure. The US battlefield is tough. Mainly because Washington decided to raise tariffs on Japanese car imports. Although the rate dropped from 27.5% to 15% in September, it remains high. Nissan expects the new tariffs to wipe ¥275 billion ($1.8 billion) from its profits this fiscal year. Honda, meanwhile, is bracing for a ¥385 billion ($54.2 billion) hit.

A Partnership That Goes Beyond Software

The collaboration could help both brands remain competitive. The American market is cooling on pure-EVs. Furthermore, the presence of Chinese brands like BYD asserts itself in other territories with aggressive pricing. Both companies already signed a partnership in August 2024. That alliance focused on vehicle intelligence and electrification.

This new round of talks could go much further. It could even lead to co-developed platforms or shared drivetrains built in the US. Espinosa did not specifically mention the prospect of Nissan building cars in North American Honda plants. In the meantime, Nissan continues with its “Re:Nissan” turnaround plan. Said plan includes cutting 20,000 jobs and reducing the number of global plants.