Taiwan's Foxconn is pausing its interest in Nissan Motor as the Japanese automaker explores a potential merger with Honda Motor, Bloomberg News reported on Friday, citing people familiar with the matter.

Nissan said Wednesday that the two carmakers had been “exploring various possibilities for future collaboration” for months. Honda chief executive Toshihiro Mibe said his company is considering a merger or joint ventures with Nissan that could put them in a better position to take on competitors.