Honda Motor Co. Ltd cut its target for electric vehicles, accounting for 30% of global sales in 2030, citing slowdown in adoption of electric vehicles and joining other automotive giants such as General Motors and Volvo Cars to retract their EV ambitions.
The Japanese automaker said Tuesday it will focus on hybrid vehicles and will launch 13 models between 2027 and 2031 as easier environmental regulations and global trade uncertainty make developed countries adopt electric vehicles.
“Honda is reevaluating its EV strategy and roadmap, including plans for the EV product lineup and the time for related investments,” Mibe said in a press conference. “It’s hard to read the market, but the company sees sales of electric vehicles from 2030 to 2030 to about one-fifth of its sales.
Additionally, the company will also hope to reduce the cost of its next-generation hybrid platform by more than 50% compared to the model launched in 2018, while it is 30% lower than the model launched in 2023.
“There is no change in Honda’s position that electric vehicles are the best solution to achieve carbon neutrality for passenger cars,” Mibe said.
Its global production was 3,733,602 vehicles in 2024, down 11% from 2023. India’s exports soared to 60% to 60,229 vehicles in the fiscal year 25.
Honda announced in December 2024 that it would launch three cars on the Indian market in fiscal year 27. Although Mibe talks about the electric vehicle plan, management has not specified how the new strategy will affect its operations in India.
Currently, it offers three models in the country – the Amaze compact sedan, the urban midsize sedan and the upgraded midsize SUV. It plans to have five SUVs on the Indian market by 2030. Currently, it owns Honda’s hybrid sedan model in the country.
India’s rise amid global electric vehicle slowdown
While adoption in major Western markets like Europe and the United States has slowed down EVs, the Indian market has performed well due to its low base. Electric vehicle sales in the country rose 20% in 2024 to nearly 100,000 units. However, the penetration rate of such cars remains at 2.5%, showing a range of range.
Several global auto giants have delayed or cut investment in the electric vehicle sector over the past year. General Motors, Volvo Cars and Aston Martin are ambitions for electric vehicles.
Previously, Tata Electric also cited slowed adoption of electric vehicles in the U.S. and European markets and suggested it could consider extending the life of its internal combustion engine model at an analyst meeting in March.
Automakers are increasingly convinced to transition to clean-fueled vehicles through multiple powertrain solutions, not just pure electric vehicles.
“Many players set some unrealistic expectations about transitioning to electric vehicles in a short time, which is why they are somewhat disappointed with the pace of adoption.”
Hyundai announced last week that it will also introduce a hybrid model in India.
“We think there is a space for all kinds of technologies in India. One solution doesn’t work properly and we need to use various technologies to achieve carbon neutrality goals,” Tarun Garg, chief operating officer of Hyundai Motor India, said in a media briefing.
Analysts also expect original equipment manufacturers (OEMs) to shift their focus from the global aggressive pure electric vehicle expansion.
“As the U.S. subsidies for electric vehicles are reduced in the U.S. and the EU Conference CO2 (C02) emission regulations are extended, most OEMs are re-focusing them on their ice product pipelines, but BEV penetration is still expected to increase,” said Elara Capital analysts.
