Japanese auto giants Honda and Nissan confirmed they've scrapped merger talks announced in December​, ending a potential combination that would have created the world's third-largest automaker.

Nissan and Honda ended merger talks to forge a $60 billion car company on Thursday, pitching Nissan deeper into uncertainty and highlighting the pressure on legacy automakers from Chinese rivals upending the industry.

The Japanese companies’ decision to call off negotiations highlights the challenges legacy automakers face in partnering to tackle new technologies.