Nissan and Honda ought to merge to compete in the EV marketplace nothing is official or signed, but each aspect has mulled the idea.

Of Japan’s vehicle giants, Nissan and Honda are reportedly in early talks to merge, keeping with The Nikkei. This would be a bold move to strengthen their role in opposition to China’s developing clout in the electric car (EV) market.

While no concrete plans have emerged yet—and each agency remains tight-lipped on the subject—Japanese broadcaster TBS shows that a legitimate statement of these discussions should come as early as next week.

Returned in March, Nissan and Honda signaled their willingness to collaborate by agreeing to discover a strategic EV partnership. However, as the BBC points out, a complete-blown merger of two of Japan’s car heavyweights could send ripples through both the political and monetary panorama — a merger risks jobs and partnerships with different companies like French producer Renault.

According to the BBC, Honda and Nissan steadily dropped their floors in China, a marketplace representing nearly 70 percent of the world’s EV income in November. Despite their blended international sales of 7.4 million cars in 2023, both brands need help maintaining their own against powerful EV Chinese-language producers like BYD.