Honda announced Tuesday that, due to recent market slowdown, it doesn’t expect to meet its previous electric vehicle (EV) sales ratio of 30% in 2030. 

Toshihiro Mibe, Honda global CEO, told reporters during a press briefing that the company plans to reduce its investment in dedicated production plants for next-generation EVs and optimize product lineup by 3 trillion yen (about $21 billion), to 7 trillion yen (about $48 billion) total.

He said Honda will shift its EV course to hybrid EVs (HEVs), where demand remains high. He said there will be a minimum increase in HEV business-related investment.  

“Therefore, we will position our HEVs, mostly next-generation HEV models which we will introduce in 2027 onward, as a group of products that will play a key role during the transition period toward the popularization of EVs,” Mibe said. “With the steady execution of this realignment, by 2030, we will strive to grow further and achieve total automobile sales volume above the current level of 3.6 million units, with a HEV sales target of 2.2 million units.” 

Honda plans to establish a flexible production system capable of optimizing production according to demand and sales strategies, a press release from the OEM states. 

“This will be achieved mainly with mixed-model production lines capable of producing both EVs and HEVs,” the release says. “In anticipation of continuous growth in HEV sales and a mid- to long-term EV shift, Honda is working to secure a stable supply of electrified components, particularly batteries, by optimizing supply capacity and allocation, including the effective use of existing assets.” 

Mibe said Marysville Auto Plant in Ohio will be one of the plants with a mixed-model production line. 

He said, to address government policy changes, Honda has established supply chains based on its longstanding commitment to “build products close to the customer.” 

To further enhance Honda’s EV and HEV competitiveness, Mibe said the company is focusing on next-generation ADAS, intending to apply the technology to main models in North America, Japan, and China in about 2027. This includes ADAS that will assist the driver with acceleration and steering operations during the entire route, whether on expressways or surface roads, Mibe said. 

Honda will leverage data obtained from vehicles in the market for future ADAS, he said. 

Honda, Nissan, and Mitsubishi discussed a merger, which they announced had failed in February. The three companies terminated their memoranda of understanding for collaboration at that time. 

According to MSN, reporters asked Mibe about the collaboration during the press conference. 

“Mibe told reporters talks were still ongoing to have the three automakers work together on developing technology,” according to MSN. “He remained vague and did not say when a deal might be reached.”

IMAGE

Photo courtesy of tomeng/iStock. Embedded graphic courtesy of Honda.