Both Toyota and Honda posted quarterly profit declines in November, amid challenges in critical global markets, including the U.S. Japan and China. Reported Toyota ROE Target. On

The proposed deal aims to unify operations under a joint holding company, led by Honda, while maintaining the distinct identities of each brand, according to Honda's president, Toshihiro Mibe. If finalized, the merger would position the combined entity to better compete with market leaders Toyota and Volkswagen.

The potential merger could help boost the auto companies production of electric vehicles amid growing changes in the car industry.