Why Did the Honda-Nissan Partnership Fall Apart? Did Honda Want Nissan to Drop e-Power?

Honda and Nissan have officially ended discussions about forming a new holding company, just two months after announcing their talks. Reports suggest that the breakup was due to significant disagreements on two key issues.

One of the biggest points of contention was Honda’s push for Nissan to abandon its unique e-Power technology in favor of Honda’s own hybrid powertrain.

According to The Japan News, citing Yomiuri Shimbun, Honda not only proposed making Nissan a subsidiary but also suggested that Nissan discontinue its e-Power system in favor of Honda’s hybrid technology.

The proposal called for Nissan to replace its electric-drive-based hybrid system with Honda’s i-MMD system, a move that met strong resistance from Nissan. This deepened the divide between the two companies’ technical philosophies and ultimately led to the collapse of the talks.

Despite the failed partnership, Nissan is moving forward with its own technology. It is currently developing the third generation of its e-Power system, which, according to its latest product roadmap, will be 20% more efficient than the original 2016 version and 15% more economical at highway speeds.

Nissan also plans to reduce production costs by about 20%, with the upgraded e-Power system debuting in the successor to the Note e-Power before expanding to models like the Kicks, Qashqai, X-Trail, and, in China, the Sylphy.

It’s worth noting that e-Power is different from traditional hybrid systems. While it still combines a fuel engine with an electric motor, the fuel engine doesn’t directly drive the wheels. Instead, it acts as a generator to charge the battery, which powers the electric motor—giving it a driving experience closer to that of a fully electric vehicle.

Since 2016, Nissan has sold over 1.5 million e-Power-equipped vehicles worldwide. However, Honda remains a dominant force in the hybrid market, increasing its annual hybrid sales by nearly a million units.

In North America, Honda’s hybrid lineup is second only to Toyota. Some believe that if Nissan had adopted Honda’s i-MMD system, both companies could have reduced development costs and helped Nissan achieve profitability sooner. However, Nissan likely rejected the idea to maintain its own technological identity.

In the end, the competition between e-Power and i-MMD will be decided by the market. Only time will tell which technology proves to be more popular.

Source: Motor1