Climate change and rising competition from Elon Musk’s Tesla causing Honda and Nissan to join hands?

Numerous auto giants across the globe are increasingly prioritising electric and hybrid vehicles as demand rises for less polluting models due to the climate crisis. The manmade emergency is elevating global average temperatures and triggering natural disasters.

It has come into the limelight that Japan’s Honda Motors and Nissan Motors are reportedly entering merger talks to help them compete against Elon Musk’s Tesla and Chinese firms such as BYD and others, according to Nikkei.

The Tokyo-based paper highlighted in a recent report that the Number 2 and 3 automakers in Japan, after Toyota, are considering operating under a single holding company and are expected to sign a memorandum of understanding (MoU).

Honda and Nissan considering bringing in Mitsubishi Motors

This is a major development. The report comes against a backdrop of Japanese automakers possibly losing ground as they continue to focus more on hybrid vehicles. China is dominating in the electric car space.

Nikkei also reported that Honda and Nissan are considering bringing in Mitsubishi Motors under the holding company to create one of the largest auto groups across the globe. It appears the Japanese firms are exploring different opportunities for collaboration.

During the brutal climate crisis, automakers are increasingly leaning in the direction of electric and hybrid vehicles. But at the same time, consumer demand for EVs has been reducing amid high prices, range anxiety and infrastructure around charging points.