Honda Motor Co. is willing to reopen takeover talks with Nissan Motor Co. to form the world's fourth-biggest automaker provided the latter's CEO Makoto Uchida steps down, the Financial Times reported on Tuesday, citing a person familiar with discussions.
Japan's second- and third-largest automakers by sales after Toyota Motor Corporation had been in talks to create a $60 billion firm after a lack of hybrid models in the U.S. and competition from local rivals in China had sent Nissan's earnings diving.
Those talks collapsed last week, plunging Nissan into further uncertainty and highlighting the pressure on legacy automakers, particularly from emerging Chinese giants disrupting the industry.
Nissan declined to comment on the FT report. Honda said the report was not something it had announced.
Nissan jumped almost 6% at one point Tuesday after the report. The gains were pared to close up 3.7%.
Uchida has been under pressure to turn Nissan around after years of faltering sales and management turmoil left the company a diminished force. Reuters reported in December that subsequent months would be critical for Uchida and Nissan's future.
Merger talks with Honda unraveled in a little more than a month due to Nissan's pride and insufficient alarm about its predicament, as well as Honda's proposal to make its smaller peer a subsidiary, sources previously told Reuters.
Uchida told reporters last week that, "We could not accept this proposal as we were not sure how much our autonomy would be kept and if Nissan's potential would be maximized."
The FT report said 58-year-old Uchida had been a strong advocate for a deal.
But his relations with Honda CEO Toshihiro Mibe had "deteriorated as Honda became frustrated with the speed of Nissan's restructuring and the depth of its financial troubles," the paper said.
The FT reported that Honda is willing to revive negotiations with a Nissan boss who can more effectively manage internal opposition. Mibe last week said his company had no plan to launch a hostile takeover bid for Nissan.
Nissan has been working on a turnaround program under which it plans to reduce its workforce by 9,000 people and global manufacturing capacity by 20%. It said on Thursday it would provide an update on the program within a month.
Uchida has expressed his intention to stay until 2026, but is facing pressure to step down in the coming months from board members and French partner Renault following the failure of negotiations with Honda, the FT reported.
Nissan's board of directors has also started informal discussions regarding the timing of Uchida's departure, the FT reported.
