How Nissan and Honda's $60B merger talks collapsed • Hacker News Board

Re: How Nissan and Honda's $60B merger talks collapsed

#211

Post by antonkochubey » Thu, Feb 13, 2025, 9:37 AM UTC

adev_ wrote: post #210

The Carlos Ghosn story is really one of the biggest cliffhanger in automotive history. When Ghosn got arrested, the Alliance Renault-Nissan was shredded to pieces. Many in Europe (including myself) were betting on a Nissan survival and a quick death of Renault. Renault that was the sick dog of the French automotive industry for decades. Mainly due to bad business decisions and a lot of debt dating from before the arr…

Renault's ICE engines are also known to be extremely reliable amongst central and southern europe's taxi drivers (who put insane mileage on them). Unlike other French marques - Peugeot and Citroen - who are in the "stay away" category amongst people who drive 40,000+ km/year

Re: How Nissan and Honda's $60B merger talks collapsed

#212

Post by forgotoldacc » Thu, Feb 13, 2025, 9:39 AM UTC

adev_ wrote: post #210

The Carlos Ghosn story is really one of the biggest cliffhanger in automotive history. When Ghosn got arrested, the Alliance Renault-Nissan was shredded to pieces. Many in Europe (including myself) were betting on a Nissan survival and a quick death of Renault. Renault that was the sick dog of the French automotive industry for decades. Mainly due to bad business decisions and a lot of debt dating from before the arr…

> They completely miss the electrification

This applies to all Japanese car companies now. They've basically told China, "Please, take the loyal market we've built up these past 40 years. We don't need or want it. We want to die."

It makes no sense.

They're betting on ICE vehicles losing no demand and on "clean" hydrogen completely displacing all demand for electric vehicles entirely.

And a quick rundown on how clean hydrogen energy works in Japan: they burn coal or petroleum to make liquid hydrogen that will replace petroleum-burning vehicles. So instead of using fuel directly, they burn stable fuel that can be used in most cars to make unstable fuel that can't be used in any cars. Smart.

Re: How Nissan and Honda's $60B merger talks collapsed

#213

Post by jillesvangurp » Thu, Feb 13, 2025, 9:40 AM UTC

alephnerd wrote: post #23

While this is HN so any automotive conversation inevitabely becomes an ideological war between EV vs ICE fanatics, this didn't play as significant a role in the failure of Nissan and Honda's merger. As stated in the article - "the merger talks unravelled in a little more than a month due to Nissan's pride and insufficient alarm about its predicament" More critically, Japanese automakers have always tried to diversify…

I think it's more realists vs. at this point the clearly losing ICE proponent side. The EV market grows double digit percentages every year. Mostly at the cost of the ICE car market. Even last year when lots of the ICE manufacturers insisted the EV market was 'shrinking' (no such thing happened), the EV market actually expanded by about 20% globally. And since the overall car market did not grow by such numbers, guess where all that growth went: not them.

Japanese companies like Nissan and Honda are a bit on that losing side. Quite literally; both are struggling with rapidly reducing demand for their now clearly obsolete vehicles and the ramp up of the production of competitive EV replacements for those.

Nissan basically dialed back investments after they got rid of Ghosn and the collaboration with Renault. Which was actually producing some early successes. Like the Nissan Leaf. They could have doubled down on that but they didn't.

Now years later they are basically facing a lot of issues with with an outdated product portfolio that can't keep up with new EVs from others grabbing lots of their market share in most of their key markets.

The reason the Nissan-Honda merger was on the table at all is that it really has gotten that bad for both of them. And of course merging two poorly performing companies doesn't result in a situation where the sum of the parts is larger than the value of the parts.

The reason this deal bounced (and was probably a bad idea to begin with) is that Nissan is in denial about their existential need to adapt to the changing market. EVs are at the center of that.

Re: How Nissan and Honda's $60B merger talks collapsed

#214

Post by junaru » Thu, Feb 13, 2025, 9:44 AM UTC

odiroot wrote: post #163

tahoeskibum wrote: post #6

Nissan, Honda & eventually Toyota are going to go the way of Nokia/Motorola after iPhone came out. Cheap and reliable Chinese EVs will take over the market (like Android), while Tesla will probably maintain a halo premium product like iPhone.

Honda will be fine. They own the motorcycle market, especially in Asia.

Noone is excited about hondas, its all about Chinese bikes - cfmotos, koves, etc.

Re: How Nissan and Honda's $60B merger talks collapsed

#215

Post by adev_ » Thu, Feb 13, 2025, 9:47 AM UTC

antonkochubey wrote: post #211

adev_ wrote: post #210

The Carlos Ghosn story is really one of the biggest cliffhanger in automotive history. When Ghosn got arrested, the Alliance Renault-Nissan was shredded to pieces. Many in Europe (including myself) were betting on a Nissan survival and a quick death of Renault. Renault that was the sick dog of the French automotive industry for decades. Mainly due to bad business decisions and a lot of debt dating from before the arr…

Renault's ICE engines are also known to be extremely reliable amongst central and southern europe's taxi drivers (who put insane mileage on them). Unlike other French marques - Peugeot and Citroen - who are in the "stay away" category amongst people who drive 40,000+ km/year

> Renault's ICE engines are also known to be extremely reliable amongst central and southern europe's taxi drivers (who put insane mileage on them). Unlike other French marques - Peugeot and Citroen - who are in the "stay away" category amongst people who drive 40,000+ km/year

Yes. This is also quite a twist of fate because 10-15y ago it was exactly the opposite.

Renault had the reputation of poor reliability with a lot of problems regarding electronics while the old TUs engines from PSA (now Stellantis) where rocks solid monsters you could bring to 300k km without a swet. Many of them are still alive and way over 1M km in northern Africa.

Re: How Nissan and Honda's $60B merger talks collapsed

#216

Post by adev_ » Thu, Feb 13, 2025, 9:50 AM UTC

forgotoldacc wrote: post #212

adev_ wrote: post #210

The Carlos Ghosn story is really one of the biggest cliffhanger in automotive history. When Ghosn got arrested, the Alliance Renault-Nissan was shredded to pieces. Many in Europe (including myself) were betting on a Nissan survival and a quick death of Renault. Renault that was the sick dog of the French automotive industry for decades. Mainly due to bad business decisions and a lot of debt dating from before the arr…

> They completely miss the electrification This applies to all Japanese car companies now. They've basically told China, "Please, take the loyal market we've built up these past 40 years. We don't need or want it. We want to die." It makes no sense. They're betting on ICE vehicles losing no demand and on "clean" hydrogen completely displacing all demand for electric vehicles entirely. And a quick rundown on how clean…

> They've basically told China, "Please, take the loyal market we've built up these past 40 years. We don't need or want it. We want to die."

It is more complicated than that.

The Chinese government in the last decade made the life of foreign automotive brand un-manageable. Most of them (outside of the luxury market) are now getting out.

They enforces rules that are clearly designed for IP leaks and takeover. For instance: For every vehicule sold in China by Toyota and others, the source of the software need to be sent to the Chinese authorities.

This is not a market that the Japanese want to stay in: They know they are playing against someone that cheats with the rules.

Re: How Nissan and Honda's $60B merger talks collapsed

#217

Post by farseer » Thu, Feb 13, 2025, 9:53 AM UTC

forgotoldacc wrote: post #212

adev_ wrote: post #210

The Carlos Ghosn story is really one of the biggest cliffhanger in automotive history. When Ghosn got arrested, the Alliance Renault-Nissan was shredded to pieces. Many in Europe (including myself) were betting on a Nissan survival and a quick death of Renault. Renault that was the sick dog of the French automotive industry for decades. Mainly due to bad business decisions and a lot of debt dating from before the arr…

> They completely miss the electrification This applies to all Japanese car companies now. They've basically told China, "Please, take the loyal market we've built up these past 40 years. We don't need or want it. We want to die." It makes no sense. They're betting on ICE vehicles losing no demand and on "clean" hydrogen completely displacing all demand for electric vehicles entirely. And a quick rundown on how clean…

Toyota has plug in hybrids from which I am guessing they would remove the ICE when they feel necessary. The rest of Japanese automakers might not make it. You have to understand that America has practically banned Chinese cars from entering the market and ICE is still big going forward in America.

Re: How Nissan and Honda's $60B merger talks collapsed

#218

Post by makeitdouble » Thu, Feb 13, 2025, 9:55 AM UTC

thuddrff567gg wrote: post #93

csours wrote: post #5

At this point I feel like a rising stock price after a crisis should be a major red flag for long term corporate survival. Carlos Ghosn was able to "turn Nissan around", but it was at the expense of future product capabilities (in my opinion) [Disclosure I work for GM, this is solely my own opinion] Also, I must say that it is not clear to me that anyone could know what a long term winning play looked like 10-15 year…

This seems to be the classic way in which management types destroy technical companies. Same thing happened a decade back in electronics companies in Japan (Sony comes to mind). Technical competence is generally very hard to judge and often even harder replace. It's not surprising that the same management types are salivating at the thought of replacing people with AI.

Could you expend on the parrallel you see with Sony ?

I was under the impression it mostly failed because of how bad it was at software, and the strategy tax hitting them heavily as their ecosystem was penalized by that weakness, so I'd be glad to hear a different take.

Re: How Nissan and Honda's $60B merger talks collapsed

#219

Post by eftpotrm » Thu, Feb 13, 2025, 9:55 AM UTC

tahoeskibum wrote: post #6

Nissan, Honda & eventually Toyota are going to go the way of Nokia/Motorola after iPhone came out. Cheap and reliable Chinese EVs will take over the market (like Android), while Tesla will probably maintain a halo premium product like iPhone.

All Tesla's global sales cars are due for replacement, and none are in the offing. Tesla are circling the drain, fast, and are very unlikely to be around in their current form in 5-10 years time - the replacement product they'd need to survive takes too long to develop and should have already started, but hasn't. Best case for them IMHO is that someone spots a key asset they own (IMHO most likely the supercharger network) and buys them for that, but the stock price is currently wildly overinflated which prevents it. One day, that bubble will burst.

TBH if I were on Tesla's board I'd be pushing for a stock-funded takeover of a company that has an actual plan and ability to deliver it. Merge with (say) Stellantis and they'd have a survival plan.

Re: How Nissan and Honda's $60B merger talks collapsed

#220

Post by makeitdouble » Thu, Feb 13, 2025, 10:07 AM UTC

forgotoldacc wrote: post #212

adev_ wrote: post #210

The Carlos Ghosn story is really one of the biggest cliffhanger in automotive history. When Ghosn got arrested, the Alliance Renault-Nissan was shredded to pieces. Many in Europe (including myself) were betting on a Nissan survival and a quick death of Renault. Renault that was the sick dog of the French automotive industry for decades. Mainly due to bad business decisions and a lot of debt dating from before the arr…

> They completely miss the electrification This applies to all Japanese car companies now. They've basically told China, "Please, take the loyal market we've built up these past 40 years. We don't need or want it. We want to die." It makes no sense. They're betting on ICE vehicles losing no demand and on "clean" hydrogen completely displacing all demand for electric vehicles entirely. And a quick rundown on how clean…

> It makes no sense.

I'm assuming you live in the US: how many US consumer companies could you cite that make product that are almost useless in the US ?

For instance, would you see Tesla make mainly cars that extremely well adapted to small and tortuous old european cities ? Or would you image Apple's next iPhone line to be fully revamped to only work with Felica NFC payments, dropping credit card and Apple Pay support ?

That is kind of how electric cars are positioned in Japan, and Toyota is a Japanese company. The market exists, but is marginal and not where the country is putting its weight on (I think you'll understand why nuclear energy in Japan much more controversial than in the US)