The company announced that has suspended development of several key electric models, including the 0 SUV and 0 Sedan projects, as well as the reactivation of the Acura RSX.
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Problems also affected cooperation with Sony — electric cars developed jointly under the Afeela brand will not hit the market.
Total losses related to these decisions may reach up to USD 15.8 billion. This shows how difficult it is for traditional manufacturers to find a profitable business model for electric cars.
Honda's problems, however, are not limited only to the EV segment. The company is clearly losing its position in the key Chinese market. Sales dropped from 1.62 million cars in 2020 to just 640,000. in 2025, and forecasts for 2026 assume a further decline – below 600,000. cars.
Additionally, the company's production plants are only used at about half of their capacity. Meanwhile, to achieve profitability, this level should be at least 70-80%.
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Strong words from Honda's president. “We have no chance”
Honda CEO Toshihiro Mibe recently visited the automotive supplier's factory in Shanghai. After this visit, he was surprised by the pace of development of the Chinese industry.
According to media reports, his comment was clear: “We have no chance.” These words refer to the so-called China Speed - the ability of local manufacturers to design and introduce new models within two years. For comparison, traditional producers often need twice as much time.
Chinese companies not only operate faster, but also cheaper, which further deepens their competitive advantage.
The automotive industry is sounding the alarm
Honda is not alone in its concerns. Ford CEO Jim Farley warned that China's production capacity is large enough to satisfy the entire North American market and eliminate competition.
A similar position was also presented by the former head of Toyota, Koji Sato, who spoke directly about it during a meeting with suppliers a threat to the company's continued existence if changes do not occur.
Chinese expansion in Europe
China's growing strength is also visible outside its internal market.
Local producers are gaining more and more importance in Europe. BYD has already achieved 1.8 percent. share in sales, and SAIC Motor – 1.9 percent, equal to brands such as Nissan. For comparison, Honda's share in Europe is only 0.5%.
