Honda is realigning its automobile strategy by prioritizing hybrid vehicles and next-gen ADAS over EVs due to changing market dynamics. The company will continue EV development while strengthening HEV offerings and optimizing its global supply chain.
Honda has announced a strategic shift in its electrification roadmap, placing stronger emphasis on hybrid vehicles while slowing down its EV rollout amid global market uncertainties. The automaker now expects its EV sales ratio in 2030 to fall below its earlier 30% target and has cut planned investments in EV development by ¥3 trillion, down to ¥7 trillion through FY2031. Key projects such as the EV value chain in Canada and dedicated EV plants have been postponed.
Despite this, Honda remains committed to EVs as the long-term solution for carbon neutrality. The upcoming Honda 0 Series—featuring personalized SDV (software-defined vehicle) experiences—will debut next year, powered by advanced ADAS technologies and a high-performance SoC developed with Renesas.
To manage unpredictable demand, Honda is building flexible production lines capable of manufacturing both HEVs and EVs. Major hybrid models will also feature the new “H mark” starting from 2027. The automaker aims to produce over 2.2 million HEVs annually by 2030.
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In motorcycles, Honda hit record global sales of over 20.5 million units in FY2025 and plans to expand its presence further by boosting both ICE and electric offerings. A dedicated electric motorcycle plant will open in India by 2028 to support its goal of leading the global e-motorcycle market.
Financially, Honda is targeting a 10% company-wide ROIC by FY2031. With a strong motorcycle business and growing HEV sales, the company plans to generate over ¥12 trillion in cash and maintain over ¥1.6 trillion in shareholder returns while adapting capital allocation to market shifts.
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