Honda Forecasts 2.5 Trillion Yen Loss on EV Pivot

Honda Motor Co. announced on Thursday that it expects to incur up to 2.5 trillion yen, or about 15.7 billion U.S. dollars, in expenses and losses as it reorients its electric vehicle strategy amid shifting U.S. policies and a slowdown in global EV demand. The Japanese automaker, which had aggressively pursued electrification, will cancel the development and launch of three planned EV models for North America: the Honda 0 SUV, Honda 0 sedan, and Acura RSX.

The decision stems from declining profitability in Honda's auto business, driven by U.S. government actions including the imposition of import tariffs, the elimination of tax incentives for EV purchases, and relaxed regulations on fossil fuel emissions. Company officials also cited intensified competition in Asia, particularly in China, where domestic manufacturers have gained significant market share. "The situation changed far more rapidly than we expected," Chief Executive Officer Toshihiro Mibe told reporters. He noted that the suspension of EV subsidies in North America hampered growth, while challenges in China prevented Honda from offering competitive models.

In response to the North American EV market slowdown, Honda is...