Foxconn Interest in Nissan on Hold Amid Honda Merger Talks, Bloomberg reports

Honda and Nissan Partnership: Taiwan's Foxconn is pausing its interest in Nissan Motor as the Japanese automaker explores a potential merger with Honda Motor, Bloomberg News reported on Friday, citing people familiar with the matter.

Foxconn's decision comes after it sent a delegation to meet with Nissan's biggest shareholder Renault in France, the report said.

Nissan and Foxconn did not immediately respond to Reuters' requests for comment. Renault declined to comment.

Reuters this week reported that Foxconn, which manufactures Apple's iPhones, had approached Nissan about a bid, but the Japanese firm rejected it.

Foxconn has not given up completely on a bid for Nissan, Bloomberg News said, adding that the Taiwanese company prefers to see if the two Japanese auto giants make legitimate progress towards a deal before deciding on its next move.

A Honda-Nissan merger would create a $54 billion company producing 7.4 million vehicles annually, ranking as the world's third-largest automaker by sales, after Toyota and Volkswagen.

This development shortly comes after a possible merger of Honda and Nissan. The two firms had already formed a strategic partnership in March to cooperate in the development of EVs, but Nissan's deepening financial and strategic trouble in recent months has added more urgency for closer cooperation with larger rival Honda.

Later, Nissan announced a $2.6 billion cost savings plan last month that includes cutting 9,000 jobs and 20 per cent of its global production capacity, as lowering sales in China and the US led to a 85 per cent decline in second-quarter profit.

The automakers have been grappling with challenges from EV makers, particularly in China, where BYD and others have surged ahead.

The talks between Honda and Nissan, first reported by the Nikkei newspaper, would allow the companies to cooperate more on technology and help them create a more formidable domestic rival to Toyota.

Also Read: Honda, Nissan Explore Possible Merger