Honda records historic losses after scaling back EV plans in US
Honda, the Japanese automobile manufacturer, recorded an operating loss of 414.3 billion yen, or around 2.2 billion euros, in the past fiscal year ending in March.
According to Agence France-Presse, this marks the company’s first operating loss since 1957, CE Report quotes STA.
The company’s net loss amounted to 423.9 billion yen, which, according to Bloomberg News, is Honda’s first net loss since it began publishing consolidated financial results in 1977.
The losses followed a major restructuring of Honda’s electric vehicle strategy, particularly in the US market. In March, Honda announced it would halt development of certain electric vehicle models in the United States, resulting in impairments and additional costs.
Honda attributed the decision to the introduction of US tariffs and the removal of tax incentives for electric vehicle buyers. The company also acknowledged that its products are becoming less competitive in China and other Asian markets.
Separately, Honda announced today that it has suspended indefinitely its plans to build an electric vehicle factory in Canada due to the “evolving business environment, changing sourcing strategy, and shifting customer demand,” AFP reported.
The Japanese automaker had announced two years ago plans to build the plant in Alliston, located around 90 kilometers north of Toronto, where it has produced conventional-engine vehicles for decades. The project was estimated at 15 billion Canadian dollars, currently around 9.4 billion euros.
As part of efforts to become a major player in electric vehicle manufacturing, Canada signed agreements to support investments by automotive giants such as Honda and Volkswagen. The country promoted itself as an ideal location for EV battery production thanks to its large reserves of critical minerals used in advanced batteries and its highly skilled workforce. However, AFP noted that several carmakers have recently revised plans to expand electric vehicle production.
Photo: Honda
