Vehicle Mesh was downloaded from City sample,
Left is the original mesh, right is the one after merge
Pretty much default settings for the merge action:
It looks like after the merge, model quality of default LOD degenerates, I’ve been messing with the settings but can not get a merged mesh that matches with the original one.
The original model drops to similar higher LOD after moving further away ( left )
Any help will be appreciated
It’s using the fallback or proxy mesh instead of the nanite model, open up the nanite settings menu on the merge actors settings.
I have been messing around with the Nanite setting in merge actors but still getting quality drop after the merging 
Plus enable nanite and disable it wouldn’t make a difference, the merged model always suffers a quality drop.
Oh, it might also have to do with the translucent materials, nanite will be disabled if there’s any translucent materials in any material slot.
I don’t know whether you have already solved or abandon this problem. Just in case others encountered a similar issue, I share my work around here. Before merging, I just saved another version of original model with Nanite disabled. Then the system would recognize its Nanite triangles as LOD0 triangles. If I used that for merging a new mesh (with Nanite enabled), all the triangles so that the quality would be preserved. Hope this information helps.
