Why does the National Party still exist? Why don't they just merge with the Liberals given that they are de facto the same party
Because they represent rural areas in a way the liberal never has and can never do.
I've heard that argument, but there are Liberal MPs from rural areas and if the Liberals are such a "big tent" party surely they can easily accommodate having some MPs from rural constituencies. I don't see other rightwing parties needing to create a rural "sub-brand". There is no separate party for UK Tories who have a lot of farmers in their constituencies and ditto for Canada and New Zealand. Just seems like an odd anachronism
I think it is relevant that Australia is such an urban country, meaning that rural areas are more likely to be worried about being marginalised, even within the Right.
In some states the Nationals have maintained more of a separate identity, whereas in Queensland and the Northern Territory they are actually merged, as the Liberal National Party and the Country Liberal Party respectively.