Nissan cancels Honda merger, Trump tariffs weigh on the auto industry, VW dealers sue Scout Motors

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Welcome to The Weekly, your go-to roundup of the top five auto industry headlines of the week. Let’s dive in.

1. Nissan walks away from Honda merger talks

Nissan is walking away from merger talks with Honda after months of negotiations failed to produce a deal. The two automakers had explored forming a joint holding company by 2026, a move that would have created the world’s third-largest carmaker.

But behind closed doors, leadership disputes, valuation disagreements, and Nissan’s financial struggles derailed the plan.

Honda’s proposal to make Nissan a subsidiary met strong resistance, and concerns over Nissan’s turnaround efforts only widened the gap.

While Nissan insists discussions aren’t entirely dead, the dream of consolidating Japan’s auto industry into a global powerhouse now looks increasingly unlikely … (Go deeper: 2 min. read)

And now—Nissan is pulling out all the stops to boost its U.S. sales volume…

2. Nissan expands U.S. dealer bonuses to drive sales through fiscal year-end

The automaker is rolling out its “Q4 Acceleration Bonus Program",” offering dealerships up to $1,000 per vehicle if they hit or exceed monthly sales targets in February and March.

Driving the news: The plan, a variation of Nissan’s familiar “stair-step” strategy, comes as the brand works to boost throughput and profitability—though industry groups warn these programs can pressure dealers into heavy discounts.

With U.S. sales up but margins tightening, Nissan is betting that strong dealer incentives will help close out its fiscal year on a high note … (Go deeper: 2 min. read)

While some Nissan dealers seem optimistic about their brand’s new bonus structure—Audi and Volkswagen dealers are gearing up for a legal battle with Scout Motors…

3. Scout Motors’ direct sales fight heats up in courtrooms and legislatures

A group of Volkswagen and Audi dealers in Florida has sued Scout, arguing its reservation system violates franchise laws.

Meanwhile, in South Carolina, where Scout is investing $2 billion in a new factory, laws also prohibit direct sales and even prevent automakers from operating service centers without dealerships.

But Scout has a key ally: Governor Henry McMaster, who is backing a new bill in the state to legalize direct sales. The proposal has bipartisan support but faces fierce resistance from the state’s dealer lobby.

With franchise laws standing in its way, Scout’s vision of bypassing traditional dealerships is facing its toughest test yet … (Go deeper: 4 min. read)

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4. Trump’s new tariffs are putting the auto industry on high alert

The auto industry is at the center of a growing trade dispute as President Trump’s new tariffs on Canada, Mexico, and China slowly take shape.

What’s happening: While China immediately hit back with retaliatory levies, Canada and Mexico secured temporary delays after agreeing to deploy border security forces.

And industry leaders are warning of higher vehicle costs and potential job losses. The American Automotive Policy Council, representing Ford, GM, and Stellantis, says the tariffs undermine billions in domestic investments and make U.S. manufacturing more expensive.

Now, automakers are scrambling to adjust, with some accelerating U.S. production plans—but whether that’s enough to offset rising costs remains to be seen … (Go deeper: 4 min. read)

And one automaker executive is already speaking out…

5. Ford CEO warns automakers could lose “billions” if Trump tariffs take effect

Ford is bracing for a tougher 2025, slashing its earnings forecast to as low as $8.5 billion—down from $10.2 billion last year—as vehicle prices soften and new SUV launches weigh on costs.

But the bigger threat? Proposed 25% tariffs on imports from Mexico and Canada.

CEO Jim Farley warns the levies would cost Ford “billions” in profit and lead to industrywide layoffs, while giving foreign automakers a competitive edge.

Despite the headwinds, Ford is doubling down on cost-cutting and quality improvements, betting that today’s pain will lead to long-term gains … (Go deeper: 2 min. read)

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• Incentives, hybrid popularity fuel early 2025 sales growth.

• General Motors lays off 50% of Cruise employees as robotaxi business winds down.

• Toyota tightens grip on California’s new car market as Tesla’s EV lead shrinks.

• Honda grows Ohio manufacturing investment to over $1 billion.

• Auto insurers want a 22.6% hike on rates for North Carolina drivers.

That’s a wrap for now – make sure you’re following along on X, LinkedIn and IG for more real-time updates.

Thanks for reading. Hit reply and let me know if you found this week-in-review valuable or have any feedback. I’ll see you next weekend.

— CDG

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