Japanese automakers Nissan and Honda have announced plans for a merger that would catapult them to a top position in an industry that's in flux as it transitions away from its reliance on fossil fuels.

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.

Honda Motor Co. sketched plans for a drawn-out deal that amounts to an acquisition of Nissan Motor Co., as Japan’s automakers struggle to keep up in an increasingly competitive global car industry.