Honda CEO Mibe on Monday said some of the company’s shareholders may feel that the deal would represent Honda supporting Nissan, but noted the merger was “based on ... question,” Wells added. Shares of Renault closed 1.2% higher on Monday.

The tie-up would create the world’s third-largest car maker by sales. But the deal appears driven more by desperation than strategic thinking.

Japanese automakers Honda and Nissan have announced plans to join forces, forming world’s third-largest automaker by sales as the industry undergoes dramatic changes in its transition away from fossil fuels.