Honda trembles: loss estimates of 3.7 billion euros

Honda expects a net loss of between 420 and 690 billion yen, or up to about 3.7 billion euros, for the fiscal year ending in late March, reversing its previous estimate of a profit of 300 billion. The announcement, made public in recent days, reflects a significant revision of the group’s financial prospects, with a simultaneous worsening of operating estimates. In this sense, the expected operating loss is now between 270 and 570 billion yen, compared to the previous estimated profit of 550 billion. To contain the economic impact, management has introduced rationalization measures, including a 30% cut in monthly compensation for three months for the CEO and vice president in fiscal 2026. Honda revises estimates downwards As part of the strategic reorganization, Honda confirmed the discontinuation of the development of three electric models intended for the North American market and also announced a cut in investments in the EV sector for the period up to 2030. From the previous 10,000 billion yen, in particular, it will go up to 7,000 billion. The EV penetration target in the global portfolio has also been scaled back, from the 30% previously expected to around 20% by 2030. The Japanese company attributes its choices to three substantial factors: the slowdown in global demand for 100% electric vehicles, regulatory changes in the USA including possible import duties, the removal of tax incentives and the easing of regulations on fossil fuels, and the intensification of competition in Asia, with particular reference to China, where investment write-downs may be necessary. Long-term targets do not change Despite the cuts and the revision of medium-term targets, Honda reaffirms its long-term commitment: the goal of marketing exclusively zero-emission models by 2040 remains confirmed, aligning with the decarbonization commitments announced five years ago. The new strategy appears oriented towards greater prudence on EV investments and a reallocation of resources, while the group evaluates the evolution of demand and the international regulatory context to define the next steps in the energy transition path.