In a surprising move, Honda Motor Co. announced it is cancelling three upcoming EVs that were planned to be built at the company’s EV hub in Marysville, Ohio.
The impacted vehicles are the Honda 0 SALOON, Honda 0 SUV, and Acura RSX SUV. All were just a few months away from the start of production.
Honda is taking this drastic action, according to a statement because of declining profitability. It cites two reasons for the decline: new U.S. tariff policies it thinks has had an “unfavorable impact” on its hybrid and gas car business, and declining competitiveness in Asia, particularly China.
In the U.S., it cites changes made to EV incentives – the USD$7,500 federal EV rebate program ended last Sept. 30 – and the relaxing of fossil fuel regulations as two main factors. Overall demand for EVs has been declining in the U.S., which was a factor in the decision.
Honda also says it is struggling to remain competitive in China, where consumers are more interested in software-derived features than traditional car attributes such as cabin space and fuel efficiency. It also noted Chinese buyers are more interested in homegrown brands like BYD, that are focused on software-based features and have shorter development cycles.
This decision is going to cost Honda a small fortune in write-downs in the short term. For the current fiscal year, ending March 31, the company expects to incur a loss of 110 to 150 billion yen (USD$10 – 15 billion).
Moving forward, Honda says it will “further strengthen” its hybrid models and employ a “fixed cost structure” for future product development. Future EVs will be rolled out with a long-term focus while, “monitoring the balance between profitability and market trends.”
Due to the projected losses, Honda says some of its executives will return part of their salaries (up to 30 percent for three months). As for the future, the company will hold a press conference in May to discuss mid-long-term strategy for its auto business.
Perhaps then we’ll get some insight into what the company plans to do with its Ohio EV hub. A similar hub in Canada, to be located at the company’s Alliston, Ontario assembly site, was paused in May 2025. Total cost of those two facilities combined is about USD$15 billion.
Full Honda statement can be found here.
Photos courtesy of Honda Motor Co.
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