Honda is feeling the impact of a significant shift in China’s automotive industry as the country moves towards an electric vehicle (EV) future. As reported Nikkei Asia, Honda has been forced to make difficult decisions, resulting in the announcement to cut 900 jobs from its joint venture in China, GAC Honda Automobile, following an 18.5% sales drop.
With China aiming for an all-electric vehicle market 2035, automakers reliant on traditional gasoline-powered vehicles are facing challenges. Honda, which mainly offers gasoline-powered and plug-in hybrid models in China, is now competing with the Chinese EV giant, BYD.
This trend is not unique to Honda, as other Japanese automakers such as Toyota Motor and Mitsubishi Motors have also experienced setbacks in China, leading to production cuts and sales declines. Meanwhile, Honda has announced a significant investment in electric motorcycles and mopeds, as well as plans to introduce 30 new electric models 2030.
While Honda’s transition to electric vehicles is not immediate, the company aims to leverage existing infrastructure for internal combustion engine models before establishing dedicated electric motorcycle production plants around 2027. In other news, China’s largest EV maker, BYD, achieved a sales record in November, surpassing Nissan. This demonstrates the strong performance of the EV sector, which is expected to continue growing.
Honda’s substantial investment and revised sales targets indicate its determination to succeed in the evolving landscape. The company’s commitment to adapt to changing consumer preferences includes initiatives such as online sales to enhance customer convenience. As the automotive industry continues to undergo profound changes, Honda is positioning itself to thrive in the electric vehicle market.