UPDATE 1-Hitachi auto unit, Honda-affiliated suppliers consider merger

(Updates source to companies, adds context, share move)

TOKYO, Oct 30 (Reuters) - Hitachi Ltd unit Hitachi Automotive Systems and three Honda Motor Co-affiliated suppliers are considering a merger to create Japan's third-biggest auto-parts supplier by sales, four of the companies involved said on Wednesday.

The move comes as carmakers struggle to adapt to technological change including the rise of electric vehicles and self-driving systems.

Hitachi would be the majority shareholder in the new company, under which Hitachi Automotive Systems would be merged with Keihin Corp, Showa Corp and Nissin Kogyo Co, the Yomiuri newspaper reported earlier on Wednesday.

Hitachi and Honda, which also would be a shareholder in the new entity, planned to announce the move later on Wednesday, the newspaper added without saying where it got the information.

Hitachi would hold less than 70% in the new company, the Nikkei reported, without citing sources.

Hitachi said in a statement it planned to discuss the proposed merger at its board meeting on Wednesday. Honda, Showa, Nissin Kogyo, and Keihin confirmed in separate statements they were considering the merger.

Shares in the three Honda suppliers were untraded with a glut of buy orders after an earlier trade suspension was lifted. (Reporting by Miwa Sasaki, Chris Gallagher, Makiko Yamazaki, Maki Shiraki; Editing by Himani Sarkar and Stephen Coates)