Uchida had been one of the strongest advocates within Nissan for a deal with Honda. However, relations between Uchida and his counterpart Toshihiro Mibe deteriorated as Honda became frustrated with the speed of Nissan’s restructuring and the depth of its financial troubles.

CEO Makoto Uchida could very well fall on his sword—whether or not Nissan’s board is still interested in a tie-up with its larger domestic rival. Japanese carmaker Honda Motor is reportedly demanding Nissan jettison CEO Makoto Uchida as a condition for reopening acquisition talks that could create the world’s third-largest carmaker by vehicle sales.

Honda Motor will resume talks with Nissan Motor to form the world's fourth-biggest automaker provided Nissan CEO Makoto Uchida steps down, the Financial Times reported on Tuesday citing a person familiar with discussions.