Major Japanese brand's crisis: Honda experience big losses as it overhauls its electric vehicle strategy for 2026

Honda has become the latest brand to be affected by the underperformance of its electric vehicles, according to reports.

The brand’s EV write-offs and expenses for developing its EVs increased to nearly $2.5 billion in the nine months up to the end of 2025.

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Its auto making business suffered a more than $1.5 billion operating loss for the first three quarters of this financial year.

It is the fourth-straight quarter the brand has recorded an operating loss in its auto making department, with losses expected to blow out to more than $6 billion for the full year.

Honda was targeting up to 2 million electric vehicle sales in 2030, but it is now expected it will only get to about 750,000.

The brand has been forced to comprehensively shake-up its EV plan, which was foreshadowed by CEO Toshihiro Mibe in May 2025.

“We intend to significantly revise our future EV strategy,” he said.

There will be more details on Honda’s new EV strategy at the start of the upcoming financial year, which gets underway in April.

The news comes after Ford reported heavy losses in the fourth quarter of this financial year, headlined by EV asset value decreases.

It is unclear what this news could mean for Honda in Australia, with the brand having no EV units on sale yet.

Honda Australia Director of Automotive Robert Thorp told CarsGuide in August 2025 that net zero emissions by 2050 is one of the company's objectives, with hybrid set-ups central to its approach.

All five of Honda’s models sold in Australia have hybrid choices as well as petrol, but it is not known yet, whether that will be enough to satisfy the Federal Government’s New Vehicle Efficiency Standard (NVES).

The brand has confirmed its Super-One city car will launch Down Under in the second half of 2026 as the first fully-electric model in its Aussie lineup.

Honda sales grew more than nine per cent in Australia in 2025, with its CR-V and HR-V SUVs leading the way.