Honda said Thursday it expects its first annual loss in almost seven decades as a listed company, warning of up to 2.5 trillion yen in restructuring charges tied to its electric-vehicle plans and additional write-downs in China as the global EV outlook softens.
The Japanese automaker now projects a loss of up to 570 billion yen for the fiscal year ending in March, reversing its prior forecast for a 550 billion yen profit. Honda listed in 1957, and a spokesperson said this would be the first annual loss since then.
U.S. EV Plans Scrapped as Demand Cools
Honda said it expects an EV-related hit of up to 2.5 trillion yen ($15.7 billion) after cancelling three EV models that had been planned for production in the United States. Chief executive Toshihiro Mibe told reporters that EV demand had fallen sharply, making profitability “very difficult” to sustain.
Auto analyst Julie Boote of Pelham Smithers Associates said the scale of the write-down surprised the market, with the larger shock coming from Honda cancelling the U.S. production program rather than simply reducing it.
The announcement came as automakers reassess EV investment plans amid policy shifts in Washington. The report said the Trump administration has ended government support for EVs, pushing several manufacturers to book large charges and revisit product roadmaps.
China Write-Down Adds Pressure
Honda also said it is writing down the value of its China business, where it has struggled against rivals such as BYD and other software-driven competitors. The company has faced intensifying competition in China’s EV market, a key battleground where domestic brands have gained ground rapidly.
In the United States, Honda’s U.S.-listed shares fell about 8% in premarket trading following the disclosure.
Industry-Wide EV Charges Keep Growing
Honda’s charge adds to a broader wave of write-downs as global carmakers scale back EV expectations. The report said the cumulative industry tally has reached roughly $67 billion, with General Motors warning of a $7.6 billion hit, Stellantis flagging $25 billion, and Ford pointing to $19 billion in related impacts.
Honda said it intends to strengthen its model lineup and improve cost competitiveness in India, a market it sees as offering room for expansion. Japanese automakers have increasingly leaned into India as they face pressure from Chinese rivals across Asia and other regions, and as China-based brands remain effectively shut out of some major markets.
Honda also said senior leadership would take voluntary pay reductions. Mibe and Executive Vice President Noriya Kaihara will forgo the equivalent of 30% of compensation for three months, while some other executives will give up 20%.
The company said it plans to announce a revamped mid-to-long-term strategy in the next fiscal year.
