In 7 Decades, This Has Never Happened at Honda

Honda just logged a financial first it never wanted: an annual loss. The Japanese automaker reported a $2.7 billion net loss for the fiscal year ending March 31—its first since going public in Tokyo in 1957—after more than $9 billion in restructuring costs tied to a pullback from its aggressive electric-vehicle plans, reports the New York Times. CEO Toshihiro Mibe said demand and the business arena at large have "changed beyond our expectations," as interest cooled after early EV adopters, charging worries remained, prices stayed steep, and US subsidies were slashed.

Reuters notes that the news "underscores how risky an aggressive bet on EVs can be for a legacy automaker when it slams into weaker-than-expected demand." Honda has now scrapped its goal of selling only electric and hydrogen vehicles by 2040, a target set when US climate policy looked far more supportive, per the Times. The company is shifting its near-term bet to hybrids, promising 15 new high-efficiency models, including larger vehicles for North America, by 2030. It also aims to return to record profits by decade's end.

Honda is also struggling with cheaper Chinese competition in Asia, where its 2025 unit sales fell more than 20% compared with 2024. Multiple EV projects with General Motors and Sony have been shelved, though Mibe insists Honda will keep investing in "highly competitive" EV technology so it can move quickly if demand rebounds. "We will continue our research to develop future technologies, including electric vehicle batteries," he said on Thursday, per the AP. "We will get back on a growth track."