Honda Says Partnership Agreement With Nissan Is Nearly Finalized

Honda and Nissan appear to be moving closer to a strategic partnership, with executives suggesting neither company wants to delay the agreement. The first phase of the collaboration is expected to focus on sharing next-generation electronic control units (ECUs), which serve as the central computing systems for modern vehicles.

Speaking during the company's annual shareholder meeting late last week, Honda President Toshihiro Mibe said discussions with Nissan had progressed to the point where "most aspects of the agreement are ready to be signed."

The announcement came shortly after Honda reported its first annual net loss, a development that drew significant attention from investors. This week, reports also indicated that the shared ECU technology is expected to be used not only in future Honda and Nissan models but also in Mitsubishi vehicles, including hybrid and fully electric models.

According to Nikkei Asia, the three automakers still need to resolve several issues related to funding future development before signing a formal agreement. However, the deal is reportedly expected to be completed within weeks rather than months.

What About Renault?

One potential complication remains Renault's ownership stake in Nissan. The French automaker still holds a 15% voting stake in the Japanese company. Because Nissan is publicly traded, shareholder approval may be required before agreements of this scale can move forward.

Honda, however, appears eager to finalize the partnership. The company recently reported a net loss of 423.9 billion yen (about $2.62 billion) for the fiscal year that ended in March. According to Mibe, if Honda cannot adapt to new industry challenges over the next three years, the company's all-wheel-drive business could face serious difficulties.