Key Takeaways Moody's gave a positive review of the potential merger of Honda and Nissan.Analyst Dean Enjo wrote that the deal would be "credit positive" if done correctly.Former Nissan CEO Carlos Ghosn warned Nissan would face "carnage" if the combination went through.

The Detroit Three are facing an auto industry increasingly affected by the rise of China as demonstrated by the planned merger of Honda and Nissan.

Japan’s second- and third-largest automakers hope the $50 billion deal would help them catch up with Tesla and China’s BYD in electric vehicles and advanced software.