Honda Motor Co will discontinue gasoline vehicle production at one of its four plants in China, a move driven by shifting demand toward electric vehicles (EVs) in the world's largest auto market [1]. The plant affected is jointly operated with Guangzhou Automobile Group Co, and Honda is also considering ending gasoline vehicle output at another joint venture plant with Dongfeng Motor Corp [1].
Honda will continue to operate its two electric vehicle plants in China as it adapts to the growing preference for zero-emission vehicles [1]. The company aims to reduce its annual gasoline vehicle production capacity in China, which currently stands at 960,000 units [1]. In 2025, Honda produced 680,000 vehicles in China, marking a 16.4 percent decline amid intensifying price competition from local EV manufacturers such as BYD Co [1].
The automaker's sales in China have been under significant pressure, with March sales totaling 36,000 vehicles—a sharp drop from over 150,000 in March 2021 and representing the 26th consecutive month of declining sales [1]. Honda is reportedly lagging behind Chinese competitors in launching new models [1].
As part of its restructuring and EV revamp, Honda is expected to post a net loss for the fiscal year ending March 2026, which would be its first annual net loss since its listing in 1957 [1].
CONCLUSION
Honda's decision to halt gasoline vehicle production at a China plant underscores the company's urgent response to declining sales and the rapid shift toward electric vehicles in the Chinese market. The move signals significant restructuring as Honda faces mounting competition and prepares for its first net loss in decades.