Honda switches focus from EVs to hybrids
Honda has announced it has shifted its manufacturing focus from electric vehicles to hybrids amidst waning consumer demand.
It has slashed EV investments before 2030 to £36.6bn, which is a reduction of £15bn, or about 30%.
The Japanese manufacturer has also cut its EV sales targets to just 30% of total sales.
Instead, Honda is ramping up production of hybrids and plans to launch 13 new next-generation models between 2027 and 2030. It will also develop a hybrid system for large-size models that it plans to launch in the second half of the decade.
It has also announced a revised hybrid sales target of between 2.2 and 2.3 million units by 2030, up from the 868,000 units it sold last year.
Uncertainty in EV market
CEO Toshihiro Mibe said: “Uncertainty in the business environment is increasing, due particularly to the slowdown in the expansion of EV the market due to several factors, including changes in environmental regulations, which had been the premise for the widespread adoption of EVs, as well as changes in trade policies of various countries.
“Considering the recent market slowdown, the Honda global EV sales ratio in 2030 is now expected to fall below the previously announced target of 30%.
“On the other hand, current market demand for HEV models is high. Therefore, Honda will position its HEVs, mostly next-generation HEV models to be introduced to market in 2027 onward, as the powertrain that will play a key role during the transition period.
“With the steady execution of this realignment, by 2030, Honda will strive to increase total automobile sale volume to above the current level of 3.6 million units, with a HEV sales target of 2.2 million units at the core.”
Honda is one of a handful of vehicle manufacturers that have scaled back EV investments. Nissan has recently shelved plans to develop an £800m battery factory in Japan while Jaguar Land Rover has abandoned plans to produce EVs at a new factory in India being constructed by parent company Tata Motor.
