Honda has decided to scrap its goal for electric vehicles to comprise 30% of its global sales by 2030. The Japanese auto giant has reduced its investment plan from an initial $69 billion to $48 billion for its electrification strategy via the fiscal year ending in 2031, AP reported. The move comes amid a slowdown in Honda’s US EV sales.
“The environment surrounding the automobile industry is changing day by day. Uncertainty in the business environment is increasing, particularly due to the slowdown in the expansion of the EV market due to several factors, including changes in environmental regulations,” said Honda, according to AP.
Honda’s Hybrid Push
Honda Motor’s Chief Executive Toshihiro Mibe reportedly called the decision “a switch in the planned course”, however, highlighted that the long-term goal of electrification will remain intact. He mentioned the Japanese auto company will focus more on producing hybrid vehicles. Under the new strategy, Honda’s auto plant in Ohio is reportedly likely to be adapted to produce both EVs and hybrids.
Mibe highlighted that the Japanese auto giant’s core strength lies in its motorcycle business, especially in markets like India, where the sales have continued to rise.
Honda’s Chief Executive emphasised the company’s aggressive push to use digital technology to strengthen safety, including assisted driving, with an aim to bring deaths from traffic accidents down to zero.
The change in electrification plan and reduction in investment come at a time when the company’s profit for the fiscal year via March declined 24.5% from the previous year, mostly driven by external factors, including tariffs and declining sales in China.
