Japanese automaker Nissan (NSANY) finds itself at a crossroads. Nissan was poised to participate in a megamerger with rival Honda (HMC), and it was a huge development when the talks were revealed late last year.

Nissan's future reportedly became the sticking point in negotiations, with Honda pushing to make its smaller competitor a direct subsidiary.

Nissan and Honda, both major automakers based in Japan, responded Wednesday to reports that a potential merger of the two companies could beat risk of being abandoned.