The reality is that Nissan would effectively become a subsidiary of Honda, something the company is finding hard to swallow. Mitsubishi Motors, a much smaller vehicle manufacturer, has already indicated that it will decline an invitation to participate in the merger so as not to lose managerial independence.

Nissan's board is in favour of abandoning merger talks with Honda but calling them off has yet to be officially decided by executives at the two Japanese carmakers, a source close to the matter told AFP on Thursday.