Honda Is Shifting Towards Hybrid with Less Focus ON EV’s

Honda has announced a shift in its focus towards hybrid vehicles, serving as a bridge to the electric vehicle shift.

Honda is strategically shifting its focus to hybrid vehicles to support the full electric vehicle (EV) transition. They have re-strategized their investments in EV by reducing them to 30%. The decision was taken due to a slowdown in global EV demand, evolving environmental regulations, and consumer hesitancy regarding full EVs.

Honda plans to significantly increase its hybrid car production. The company aims to introduce 13 new hybrid models globally between 2027 and 2031, with a specific target of selling between 2.2 million and 2.3 million hybrid vehicles annually by 2030. This is a substantial increase from the 868,000 hybrids sold in 2024.

Honda is actively developing new hybrid powertrain technologies, including a next-generation e: HEV system set to debut in 2027. These new systems aim for improved fuel efficiency (by over 10% compared to current systems) and reduced production costs (over 50% lower than 2018 models and over 30% lower than 2023 models). A dedicated hybrid system for large-sized vehicles, particularly for the North American market, is also in the works, promising powerful driving performance and high towing capability.

Honda is reducing its planned investment in electrification and software by 30%, from approximately $69 billion to $48.4 billion by 2030. Consequently, the company now expects electric cars to account for about 20% of its sales by 2030, instead of the previously targeted  30%. Honda has paused a C$15 billion (approximately $10.7 billion) plan to transform its Ontario, Canada, factory into an EV manufacturing hub, delaying the project by about two years.

Despite the near-term adjustments, Honda maintains its long-term vision of having battery-powered vehicles constitute 100% of its new car sales globally by 2040. The company’s new generation of EVs, showcased by the futuristic “0 Saloon” and “0 SUV” models, are still slated for production at Honda’s Ohio facility starting next year.

Honda plans to introduce its next-generation ADAS systems, capable of assisting with acceleration and steering throughout the entire driving route, in both EV and hybrid models starting around 2027. Honda views hybrids as a crucial bridge technology that can meet consumer needs and regulatory requirements during the transition period.