Honda Kills Three Electric Vehicles for U.S.

Waning EV appetite and financial losses are to blame.

We should have seen this coming. Honda says it is cancelling three electric vehicles it had planned to build in the U.S., citing financial losses and slowing demand for EVs.

The news from Japan is not surprising given that much-touted plans for its next-generation 0 Series of vehicles, including a plant to be built in Canada, had already undergone changes.

Now Honda says it is cancelling the launch of the 0 Series SUV and the funky 0 Series sedan as, well as the Acura RSX. They were almost production-ready when Honda showed them off last year at CES. They are the first EVs for America that Honda developed in-house; the first EVs it put on sale here, the Honda Prologue and Acura ZDX, were developed in partnership with GM.

The first generation of 0 Series was to come from the retooled Marysville plant in Ohio with production set to begin this year. The next generation was planned to emerge from a retooled plant in Canada starting in 2028, but those plans had already been paused, as had the addition of a battery plant in Alliston, Ontario.

Too Much Red Ink

In a release, Honda said it is already looking at losses due to tariffs, declining interest in EVs, and slowing sales in Asia, especially China. Launching the three new EVs would be a further drag on finances.

“We determined that starting production and sales of these three models in the current business environment where the demand for EVs is declining significantly would likely result in further losses over the long term,” the company said.

The financial impact of the write-downs will be included in earnings for the current fiscal year that ends March 31 and some will continue into the next fiscal year, says Honda CEO Toshihiro Mibe. It means the year that was going to end in profits will now result in an operating loss as high as $15.8 billion and year-end losses of $5.1 billion to $7 billion.

Hybrids for the Foreseeable Future

Honda recently underwent a review of its overall strategy, concluding the appetite for EVs in the U.S. continues to wane. The automaker is focusing on hybrids, an area of expertise. Honda has planned a massive overhaul of its hybrid lineup, the platforms they use, and their drive units. On tap are new four-cylinder and V-6 engines, electric hardware, and battery packs. The first next-generation models are due in 2027.

The company is looking at its battery plant production with an eye to using the batteries for hybrids instead of EVs and also converting some to storage batteries, a switch other automakers are making as well.