Honda’s CEO struggles to explain why the merger is happening, analysts remain skeptical, and Foxconn waits in the wings.

The Honda-Nissan-Mitsubishi merger looks increasingly likely to happen. The tie-up could save Nissan, which is experiencing severe financial troubles. Creating a giant Japanese automotive holding company would create an entity that’s more globally competitive than the companies’ current positions.

The potential deal would create a $50 billion company that would be the world’s third-largest automaker by sales volume, behind only Toyota and VW Group.

This merger could create the world’s third-largest automaker, with combined resources to dominate the EV market. Honda and Nissan hope to outpace rising Chinese brands like BYD and Nio.

Facing extreme competitive pressure from the rise of Chinese EV makers, the Nos. 2 and 3 Japanese automakers turn to each other to build strength.

Japanese automakers Honda and Nissan will attempt to merge and create the world’s third-largest automaker by sales as the industry undergoes dramatic changes in its transition away from fossil fuels.

The proposed deal aims to unify operations under a joint holding company, led by Honda, while maintaining the distinct identities of each brand, according to Honda's president, Toshihiro Mibe. If finalized, the merger would position the combined entity to better compete with market leaders Toyota and Volkswagen.

Speculation about a potential Honda and Nissan merger began earlier this month, and the two companies confirmed the official start of talks Monday.

Japanese automakers Nissan and Honda have announced plans for a merger that would catapult them to a top position in an industry that's in flux as it transitions away from its reliance on fossil fuels.

"It's not a pragmatic deal because frankly, the synergies between the two companies are difficult to find," Ghosn told Bloomberg.

TWO days before Christmas, a triple car-company press conference was held for the global audience. Honda, Nissan, and — on the side — Mitsubishi went online to announce a move that was somewhat shocking but not entirely surprising.