TOKYO: Shares in Japanese automaker Mitsubishi Motors plunged nearly nine percent Friday after a report said it might not join a planned merger between industry giants Honda and Nissan.
Honda and its struggling rival Nissan agreed last month to launch talks on the tie-up, which is seen as an attempt to catch up with Chinese rivals and Tesla on electric vehicles.
The two firms, along with Mitsubishi Motors, said they had signed a memorandum of understanding to start discussions on integrating their businesses under a new holding company.
Japan’s Yomiuri daily said Friday that the smaller automaker was considering not taking part — sending its shares plummeting as much as 8.7 percent in morning trade before paring the losses in the afternoon to sit six percent lower.
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Honda was down more than one percent, while Nissan slipped 3.5 percent.
With a much smaller market capitalisation than Honda and Nissan, Mitsubishi Motors is worried that being absorbed by the holding company could undermine its management autonomy, the Yomiuri said. Mitsubishi Motors is partly owned by Nissan.
The automaker may seek to strengthen cooperation with the pair in areas such as electric vehicles instead, public broadcaster NHK said.
The company said in a statement that “such information was not released by Mitsubishi Motors”, referring to Yomiuri’s original report.
“At this moment, we are studying various options, and no conclusion has been reached,“ it added.
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The merger between Honda and Nissan would create the world’s third-largest automaker, expanding development of EVs and self-driving tech.
China overtook Japan as the biggest vehicle exporter in 2023, helped by government support for EVs.
Honda and Nissan — Japan’s number two and three automakers after Toyota — already agreed to explore a strategic partnership on software and components for EVs among other technologies.
This partnership was joined by Mitsubishi Motors in August.
