TOKYO, May 20th, 2025: Japanese multinational conglomerate Honda has made a significant decision to reduce its spending on electric vehicle (EV) initiatives by 30%, lowering the budget from 10 trillion yen to 7 trillion yen till FY 2031
This move indicates a global slowdown in electric vehicle demand, with consumers increasingly shifting their preference toward hybrid models. According to company management, this investment reduction reflects a notable decline in consumer interest in pure EVs, leading Honda to prioritize hybrid electric vehicles (HEVs).
The company has also announced the introduction of a new “H mark” logo, which will be featured on EV and major HEV models starting in 2027.
This logo represents Honda’s vision for intelligent, electrified mobility. In alignment with its revised global strategy, Honda plans to launch 13 next-generation hybrid models over the next four years, beginning in 2027.
Currently, the company offers more than a dozen hybrid models worldwide, including three in the U.S.: the Civic (available in both hatchback and sedan versions), the Accord, and the CR-V.
According to updated projections, Honda aims to sell 3.6 million vehicles in the fiscal year 2025-2026, with over half, approximately 2.2 million units, expected to come from HEVs rather than pure EVs.
During a recent business briefing, Toshihiro Mibe, Director, President, and Global CEO of Honda Motor Co., Ltd., indicated that the company’s focus on automobile electrification will primarily emphasize hybrid vehicles. He noted that due to the recent market slowdown, the anticipated global EV sales ratio for Honda in 2030 is now expected to fall below the previously stated target of 30%.
Mibe also highlighted strong current demand for HEV models, underscoring that Honda will prioritize next-generation HEVs, set to launch in 2027 and beyond, as a crucial powertrain option during the transition to widespread EV adoption. He expressed the company’s commitment to increasing total automobile sales above the current target of 3.6 million units by 2030, focusing on achieving 2.2 million units in HEV sales.
“It’s really hard to read the market, but at the moment, we see EVs accounting for about one-fifth of our sales by then,” CEO Toshihiro Mibe informed the media at the press conference.
Automotive analysts suggest that this global shift is also linked to U.S. President Donald Trump’s decision to revoke a Biden administration executive order aimed at ensuring that all new vehicles sold in the United States by 2030 would be electric.
Additionally, Honda has put its plans for a C$15 billion ($10.7 billion) EV production facility in Ontario, Canada, on hold due to declining demand for electric cars.
Other Japanese automakers, like Nissan, have also abandoned plans to build a $1.1 billion battery factory on Japan’s southwestern island of Kyushu just months after announcing the project.
With the launch of 13 new HEV models and a sales target of 2.2 million units, Honda is strategically positioning itself to lead in the hybrid market while preparing for a future with electric vehicles, thereby delivering sustainable mobility solutions tailored to diverse global markets, such as India.
