Honda’s four straight quarters of losses triggered a $1.7B EV write-off and major rethink of its future electric strategy
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Honda logged its fourth straight quarter of operating losses.
EV-related write-offs reached $1.71 billion through December.
A revised EV roadmap is expected to be announced this year.
Honda, like many other automakers, is learning just how expensive missteps and overinvestment in the EV market can be. The Japanese company has already taken major write-offs tied to its electric vehicle efforts and now finds itself in damage control after multiple consecutive quarters of operating losses.
Read: Honda’s New Electric SUV Might Be Small But Its Global Ambitions Are Big
In the nine months ending December 31, Honda reported 267.1 billion yen (or $1.71 billion) in write-offs and expenses tied to its push into electric vehicles. While the financial impact hasn’t reached the same level as Ford’s EV setbacks, it remains a troubling sign for Honda’s strategy.
Losses Pile Up
Honda has shelved several upcoming EV models and recently logged its fourth straight quarter of operating losses. For the first three quarters of its fiscal year, those losses total 166.4 billion yen, or $1.07 billion. Industry outlet Auto News projects that the full-year impact could reach 700 billion yen, around $4.48 billion, all stemming from its EV ventures.
Speaking about Honda’s most recent financial results, executive vice president Noriya Kaihara acknowledged the firm needs “to conduct a fundamental review of our strategies to rebuild our competitive strength.”
GM Partnership Unwinds
Things will soon become even more costly. Honda is ending its close cooperation with General Motors on EVs, due in part to slow sales of the Acura ZDX and Honda Prologue, both of which use GM’s Ultium EV platform. It’s understood that Honda reduced the number of vehicles it purchased from GM, and compensated the carmaker.
Redrawing The EV Map
As recently as 2024, Honda said it aimed to sell up to 2 million EVs annually by 2030. However, it greatly overestimated the global popularity of EVs, which has undoubtedly been affected in part by the change in administration in the US just over twelve months ago. According to Kaihara, the company now plans to “significantly revise our future EV strategy” and expects to unveil an updated roadmap in the near future.
That said, Honda recently told us during a roundtable that the new electric Acura RSX and Honda 0 Series SUV are still on track for a launch later this year.
Central to this realignment will be a renewed emphasis on hybrid models. Honda aims to double its hybrid sales to 2.2 million units in 2020, signaling a clear pivot away from its earlier EV-heavy approach.
