This merger could create the world’s third-largest automaker, with combined resources to dominate the EV market. Honda and Nissan hope to outpace rising Chinese brands like BYD and Nio.

Honda has worked with GM in a series of collaborations that did not involve any exchange of corporate equity. In 1993, GM controlled Isuzu and signed a deal to supply its Rodeo to become Honda’s first SUV,

Japanese automakers Honda and Nissan will attempt to merge and create the world’s third-largest automaker by sales as the industry undergoes dramatic changes in its transition away from fossil fuels.

Honda's shares went up by as much 17% when local markets opened on Tuesday.

Japan’s second- and third-largest automakers hope the $50 billion deal would help them catch up with Tesla and China’s BYD in electric vehicles and advanced software.

Japanese automakers Nissan and Honda have announced plans for a merger that would catapult them to a top position in an industry that's in flux as it transitions away from its reliance on fossil fuels.

Honda Motor Co’s proposed acquisition of Nissan Motor Co could provide the scale needed to challenge China’s BYD Co, sales data revealed Wednesday. The move highlights mounting pressure on Japanese automakers to compete in a market increasingly dominated by China’s burgeoning automotive industry.

The Japanese companies are considering joining forces to survive in a rapidly changing auto industry, but auto history is filled with troubled and failed marriages.

"Today marks a pivotal moment as we begin discussions on business integration that has the potential to shape our future,” said Nissan Director, President, CEO, and Representati