A Potential Merger Between Honda and Nissan - Impact on Hyundai Motor and Kia Corp

• A potential merger between Nissan Motor and Honda Motor would create the third largest auto group in the world.

• If this merger is successful, it could have a short term positive impact on Hyundai Motor since it could result in a reduction of overlapping sales/marketing and production of Nissan.

• However, a merger of Honda and Nissan could negatively impact Hyundai Motor over the long term because the merged entity could produce more high quality, price competitive vehicles.