Honda Hybrid Strategy 2025: Carmaker Reduces EV Push, Doubles Down on Hybrids
As demand for electric vehicles (EVs) slows globally, Honda Motor Co. is shifting gears. The Japanese automotive giant announced it will scale back its EV investment and instead prioritize hybrid vehicles as a core part of its strategy moving into the next decade.
Speaking at a press conference in Tokyo, CEO Toshihiro Mibe confirmed the company’s revised outlook: electric vehicles are now expected to account for just 20% of total sales by 2030, down from its earlier goal of 30%. “The market is hard to predict, but we see hybrids playing a stronger role for now,” he stated.
As part of this pivot, Honda has cut its planned investment in electrification and software by 30%, bringing it down to 7 trillion yen ($48.4 billion) by 2030. The move aligns with a broader trend across the auto industry, as several global manufacturers are pulling back on aggressive EV targets due to consumer hesitancy and relaxed government timelines.
For example, the Biden-era order in the U.S. targeting full EV sales by 2030 has been revoked by President Trump, leaving manufacturers caught in policy uncertainty.
Despite dialing back EV efforts, Honda is planning a strong hybrid lineup, with 13 new next-generation hybrid models scheduled to launch globally between 2027 and 2031. The company already offers several hybrid models—including the Civic, Accord, and CR-V—but aims to sell up to 2.3 million hybrid units by 2030, a significant jump from the 868,000 sold in 2024.
Honda is also developing a hybrid system for large vehicles, expected to debut later in the decade, to serve growing market interest in more efficient SUVs and larger family vehicles.
Earlier in May, Honda postponed a C$15 billion ($10.7 billion) EV manufacturing project in Ontario, Canada, citing declining demand. Nevertheless, the company reiterated its long-term vision of having all new vehicle sales powered by batteries or fuel cells by 2040.
Other automakers are experiencing similar recalibrations. Nissan recently scrapped plans for a new battery factory in Japan, and Jaguar Land Rover reportedly paused EV production at a planned facility in India.
With market realities reshaping the electrification narrative, Honda’s renewed focus on hybrids underscores a more measured, phased approach to sustainability—balancing innovation with demand.
