Japanese automaker Honda just cancelled the production of three planned made-in-the-U.S.A. electric cars, including the 0-Series SUV, the 0-Series Saloon, and the Acura RSX — and the company says it will write off massive losses as a result.
Still, better than building EVs nobody wants to buy. The company said the EVs had to go to avoid future losses, complaining about the “current business environment where the demand for EVs is declining significantly.”
I follow these things, and I’d somehow never even heard of Honda’s 0-Series vehicles — assuredly for “zero emissions” — introduced at the 2024 Consumer Electronics Show in Las Vegas, and were supposed to go on sale in the U.S. later this year.
The company’s 0-Series English-language and Japanese brag sheets are still up on the Honda website, for whatever that’s worth.
Honda blamed U.S. tariffs (I’ll come back to those in a moment), the “volatile policy environment surrounding EV incentives,” (as Car and Driver put it), fossil fuel regulations, and changing consumer priorities in China.
Honda says total write-downs could total $15.8 billion.
While the epic losses won’t all come at once, Honda says it expects to lose between $2 billion and $3.5 billion in the current fiscal year, ending this month. According to Financial Times, that’s Honda’s first-ever annual recorded loss since going public 50 years ago.
What’s maybe most impressive about losing nearly [dr_evil_voice] SIXTEEN BILLION DOLLARS [/dr_evil_voice] on EVs is that Honda didn’t even try that hard, at least not compared to certain other automakers I could name — and am about to.
GM said in January that it would suffer $7.6 billion worth of write-downs on its overblown EV plans, and in December, Ford announced a $19.5 billion write-down on its EV investments. That’s one of the largest in history.
Europe-based Stellantis took one look at Ford’s losses and said, “Hold my beer.”
Headquartered in the Netherlands, the Euro-giant also owns the old Chrysler Group brands, including Chrysler, Dodge, Ram, and Jeep. Despite Europe offering even bigger subsidies and stricter mandates for EVs than this country does, Stellantis last month announced a whopping $26.6 billion in EV losses.
Then there’s fussy old Toyota, which remained largely focused on hybrids and fuel-efficient ICE vehicles. That company seems to be doing just fine.
American tariffs might have complicated Honda’s poor planning, but as you can see, they weren’t primarily to blame. Those same tariffs were supposed to help GM and Ford sell their cars — including EVs — but American EV makers took their lumps, too.
The real culprit here, of course, is Big Government. Washington, Brussels, and Beijing went all-in on subsidizing and even mandating a market into existence — a market that there simply wasn’t enough demand to serve. Not even with all the subsidies and mandates. So automakers retooled manufacturing facilities, built massive battery factories, and designed EVs (and pricy software to run them) from the ground up. Now they have to throw out some of the designs, scale back the battery production, and re-retool the plants.
Thanks, Big Government!
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