Honda just lost money for the first time in 70 years
CNN • • business
Key Points:
- Honda reported its first annual loss since 1955, posting a net loss of $2.6 billion for the fiscal year ending in March, largely due to a $10 billion writedown on its electric vehicle (EV) investments.
- The pullback in EV plans by Honda and other automakers followed the Trump administration's rollback of stricter US emissions rules and the elimination of the $7,500 EV tax credit, which caused a sharp decline in EV sales.
- Automakers shifted focus back to profitable gasoline-powered trucks and SUVs, resulting in costly write-downs on EV investments; similar charges were reported by General Motors, Ford, and Stellantis.
- Despite these setbacks, automakers have not abandoned EV development entirely, as stricter emissions regulations remain in effect in Europe, Asia, and some US states like California.
- Competition from Chinese EV manufacturers is a growing concern for global automakers, though Chinese brands currently have limited presence in the US market.