Retreating their ambitious EV plans, Honda cancels three US models, braces for historic losses, and pivots toward hybrids amid fierce global competition.
Honda has confirmed the cancellation of three electric vehicles (EV) planned for the US market: the 0 Series Saloon, 0 Series SUV and Acura RSX, following a reassessment of its electrification strategy.
The decision, announced on Wednesday, March 11, 2026, comes as the automaker faces mounting financial pressures and intensifying competition.
The company now expects a net loss for the fiscal year, after reporting a $1.7 billion deficit across the previous three quarters. Longer-term, Honda anticipates expenses and losses of up to 2.5 trillion yen ($15.7 billion) linked to its EV turnaround, with a renewed focus on strengthening hybrid models.
Honda described its automotive business as being in a challenging earnings situation, citing tariffs affecting gasoline and hybrid vehicles, as well as heightened competition in China’s rapidly evolving market for software-defined cars.
It acknowledged that it had struggled to deliver products offering better value than newer EV manufacturers.
The automaker now projects losses of up to 1.12 trillion yen ($7 billion), alongside investment losses of 150 billion yen and special losses of 570 billion yen. In response, some executive officers will voluntarily return up to 30% of their compensation.
According to the Financial Times, this would mark Honda’s first annual net loss since becoming a public company in the 1950s.
Honda confirmed that, despite cancelling three electric vehicle projects, its Ohio facilities would continue producing petrol and hybrid models. A company spokesperson explained that the automaker had established a highly flexible manufacturing environment in Ohio, designed to build products aligned with customer demand. He added that this flexibility remained central to Honda’s overall strategy.
The future of the Afeela 1 sedan, developed with Sony Honda Mobility, remains uncertain. Honda has promised to outline a restructured mid- to long-term automotive strategy at a press conference in May 2026.
