Don’t underestimate the pride of an ailing company. After signing a memorandum of understanding in late December to “consider” a merger with Honda, a source told Reuters that Nissan is backing out of the discussion.

With the $60 billion merger now seemingly off the table, Nissan is looking for other options to stay competitive, particularly after recent financial setbacks. Citing two unnamed sources, Reuters reports that the automaker is open to working with technology companies, with Foxconn emerging as a serious contender.

Nissan has ended merger discussions with Honda and is now open to working with new partners, including technology firms such as Foxconn

The Taiwanese iPhone-maker better known as Foxconn was exploring an investment or buyout of Nissan last year but backed off in December 2024.

Nissan looks set to end its proposed merger with Honda and link with another tech giant, following reports of a breakdown in talks between the automotive companies.

As software-defined vehicles now dominate the auto industry, Nissan could benefit from a partnership with Foxconn, which can procure some of the most advanced semiconductors, Itochu Research Institute researcher Sanshiro Fukao said. In return, Foxconn could use Nissan’s surplus production capacity for its contract manufacturing business.

Even if the merger is off, Nissan remains keen on working with Honda in areas such as electric vehicles and software defined vehicles.