Honda scraps EV targets after posting first loss in 70 years
Honda Motor has recorded the worst financial results in its nearly 70-year history as a public company and Canada's $15bn EV ambitions are among the casualties.
According to CNN, the Japanese automaker posted a full-year net loss of $3.68bn for the fiscal year ended March, wiping out what would have been a roughly US$7.4bn profit.
Honda booked roughly $14.4bn in EV-related charges for the year, with an additional $4.9bn expected in the current fiscal year, Reuters reported.
Chief executive Toshihiro Mibe said Thursday the company was abandoning its target of EVs accounting for 20 percent of new car sales by 2030 and scrapping its goal of a full shift to electric or fuel-cell vehicles by 2040.
Honda plans to redirect resources toward hybrids and conventional gasoline models instead.
Honda indefinitely suspended its planned EV value chain project in Ontario, the company confirmed Thursday.
CBC News reported the project, first announced in April 2024 alongside then-prime minister Justin Trudeau and Premier Doug Ford, was expected to produce 240,000 vehicles a year, create roughly 1,000 manufacturing jobs, and come online by 2028.
Ottawa and Ontario had each pledged $2.5bn toward the investment, but Honda said it has not received any of that funding.
“Based on our revised strategic objectives, we have determined that an indefinite suspension of the value chain project is appropriate at this stage,” Honda said, cited by CBC News.
Prime Minister Mark Carney called the move “disappointing” but argued the broader shift toward lower-emission vehicles remained intact, citing rising global gasoline prices.
Greg Layson, digital editor for Automotive News Canada, told CBC News the math had become unworkable, saying losses combined with ongoing tariff costs make it “really difficult to follow through on $15bn plans.”
According to AP News, Honda blamed the losses on the Trump administration's elimination of a US$7,500 EV buyer tax credit, the scrapping of Biden-era emissions standards, and tariffs on imported autos and parts reduced from 25 percent to 15 percent.
The administration also blocked California's planned ban on new gasoline-powered car sales by 2035 and withheld funding for EV charging infrastructure.
Honda was not alone.
General Motors recorded a US$7.2bn EV-related charge in 2025 but remained profitable; Ford posted a US$17.4bn charge and a net loss; and Stellantis reported a US$29.7bn charge and also swung to a loss, CNN reported.
Honda's motorcycle division posted record sales volume and operating profit, selling 22.1m units globally — up from 20m the prior year — led by strong demand in India and Brazil, AP News reported.
Reuters said that the company forecast a return to profitability in the fiscal year through March 2027, projecting net income of roughly $3.3bn, and pledged at least $7.9bn in shareholder returns over three years while holding its annual dividend at 70 yen per share.
James Hong, head of mobility research at Macquarie, told Reuters the turnaround window is narrow.
Honda's execution on its EV pivot had been “very slow,” he said, and even the profitable motorcycle business faces margin pressure from EV transitions in key markets like India and Vietnam.
“They have a limited time window to act,” Hong said.
(All yen-to-CAD conversions are approximate, based on a rate of 1 JPY = $0.0087 CAD; USD-to-CAD conversions based on a rate of 1 USD = $1.37 CAD, as of May 15.)
