Japanese automaker Honda Motor Co. (HMC) said Tuesday that slowing electric-vehicle (EV) demand in the United States has prompted it to abandon its goal of having EVs comprise 30% of global sales by 2030. CEO Toshihiro Mibe described the change as a “shift in the planned route,” noting that the long-term move to electrification remains intact but will be delayed.
Investment in Electrification Reduced
Honda had planned to invest 10 trillion yen (about $69 billion) through fiscal 2031 in its EV strategy. The company will now cut that commitment by 3 trillion yen to 7 trillion yen (roughly $48 billion). In a statement, Honda said the auto industry environment is “changing rapidly,” with rising uncertainty as EV market growth slows and regulations evolve.
Greater Emphasis on Hybrids
Rather than setting a new EV-sales deadline, Honda will “be more aggressive in making hybrids,” Mibe said. The Marysville, Ohio, plant will be retooled to build both electric and hybrid models alongside its Civic and Accord lines.
Mibe highlighted the strength of Honda’s motorcycle division, particularly in India, where sales and market share continue to rise.
Digital Safety and Zero-Fatality Goal
Honda is also deepening its use of digital technologies, including driver-assist systems, to push toward its long-term target of zero traffic fatalities. Mibe emphasized safety as a core pillar of the company’s future strategy.
Alliance Talks Continue Despite Merger Breakdown
Late-2024 talks to merge Honda’s operations with Nissan Motor Co. and Mitsubishi Motors Corp. collapsed this year. Nonetheless, Mibe said discussions on joint technology development are ongoing, though he offered no timeline for a deal.
Profit Declines but Outlook Remains Strong
For the year ended March, Honda’s profit fell 24.5% from the prior period, largely due to external pressures such as tariffs and weaker sales in China.
Equity analyst Aaron Ho of CFRA Research noted, “Honda’s earnings outlook remains strong, supported by cost-cutting measures.” Traders and industry watchers will look for further details on Honda’s revised investment plans and hybrid rollout in the months ahead.
