Honda Posts First Annual Loss in Nearly 70 Years After $9bn EV Writedown

Japanese automaker Honda has reported its first annual loss in nearly 70 years as a listed company, driven by a massive writedown of more than $9 billion tied to its electric vehicle (EV) strategy.

The company posted an operating loss of around 414.3 billion yen ($2.6 billion) for the fiscal year ending March 2026, a sharp reversal from a profit of more than 1 trillion yen the previous year. The result marks Honda’s first full-year loss since it went public in 1957.

At the centre of the downturn is a significant restructuring of its EV business, with total EV-related losses estimated at about 1.45 trillion yen ($9–10 billion), driven by writedowns, cancellations, and delayed projects.

In response, Honda has officially scrapped its long-term EV sales targets, including its plan for EVs to account for 20% of global sales by 2030 and its ambition to transition fully to electric or fuel-cell vehicles by 2040.

The automaker is also reportedly suspending major EV investments, including a planned $11 billion battery and production facility in Canada, as it reassesses its electrification strategy amid weaker-than-expected demand and rising costs.

Despite the historic loss, Honda maintained investor confidence by keeping its dividend unchanged and pledging strong shareholder returns over the next three years. Its shares even rose after the earnings announcement, supported by strong performance in its motorcycle division, particularly in India and Brazil.

Analysts say the company’s setback reflects broader challenges facing legacy automakers as the global EV market slows, competition from Chinese manufacturers intensifies, and demand shifts toward hybrid models.

Honda now plans to refocus on hybrid and internal combustion engine vehicles while gradually scaling back aggressive EV expansion plans.