Honda Swings to First-Ever Net Loss — EV Strategy Overhaul Triggers Up to ¥2.5tn Charge
Honda Motor Co., Ltd. (TSE:72670) has revised its earnings forecast for the fiscal period ending March 31, 2026, after deciding to cancel three North America EV models and write off associated assets. The company now expects its first annual net loss since its 1957 stock market listing.
| Item | Before | After | Change |
|---|---|---|---|
| Revenue | ¥21.1tn | ¥21.1tn | — |
| Operating Profit | ¥550bn | △¥270–570bn | △¥820bn–¥1.12tn |
| Pre-tax Profit | ¥620bn | △¥820bn–¥1.12tn | △¥1.44–1.74tn |
| Net Profit | ¥360bn | △¥310–650bn | △¥670bn–¥1.01tn |
| Net Profit (parent) | ¥300bn | △¥930bn–¥1.27tn | △¥1.23–1.57tn |
| EPS | ¥75.05 | △¥105.07–172.62 | — |
| Equity-method Investment Loss | ¥1.1tn | ¥1.1–1.5tn | +¥400–500bn |
Honda cited the decision to halt development and production of the Honda 0 SUV, Honda 0 Saloon, and Acura RSX — three EV models planned for North American production — as the primary reason for the revision. Asset write-offs and impairment losses related to the electrification strategy, plus potential impairment on China investments amid intensifying competition, drive the bulk of the charge.
The current-year impact (¥820bn–¥1.12tn in operating expenses plus ¥400–500bn in equity-method losses) is expected to be followed by additional charges in subsequent years, with cumulative losses potentially reaching ¥2.5tn. President Toshihiro Mibe stated the decision was made with "great reluctance" and announced a partial return of executive compensation.
Source: Original filing (TDnet) | 日本語版
This article is for informational purposes only and does not constitute investment advice. Always verify against the original filing.