Honda suffered a big blow, loss of 16 billion dollars due to change in EV plan, now strategy will change in India

Honda Electric Vehicle Strategy: Japan’s famous automobile company Honda Motor has suffered a major setback in the field of electric vehicles. The company has recently made a shocking revelation that for the first time since entering the market in the 1950s, it has faced an annual loss.

As soon as this news came out, its impact was seen in the stock market also. According to the report, the company’s shares fell by more than 6 percent. It has also come to light that due to the change in its electric vehicle strategy, the company may have to face huge expenses and possible losses of up to $16 billion.

Why did the old electric strategy fail?

Honda explained in its official announcement that due to some major economic and policy changes it had to rethink its EV strategy. According to the company, the end of tax exemption on buying electric cars in America and the relaxation in rules related to petrol and diesel vehicles proved to be a big blow for them.

Apart from this, the sudden decline in demand for electric cars in North America also affected the company’s plans. This is the reason why Honda had to stop the development and launching projects of many of its electric models midway.

Increased pressure in China market

Apart from America, Honda is also facing tough competition in Asian markets. Especially the increasing dominance of local companies in China’s automobile market has weakened Honda’s position. The company has also indicated that the value of some investments made in China may have to be reduced. This may also affect the financial strategy of the company in the coming time.

Other companies are also changing EV plans

Honda is not the only company to change its strategy regarding electric vehicles. In recent months, big auto companies like Ford and Stellantis have also decided to revise their EV plans. This indicates that the global auto industry is currently resetting its strategies according to the demand and policies of the electric vehicle market.

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Focus on hybrid cars may increase in India

A major change may also be seen in Honda’s strategy regarding the Indian market. According to reports, the company is planning to focus more on hybrid (petrol + electric) models instead of fully electric cars in India.

In fact, the charging infrastructure in India is not yet fully developed, due to which many customers are hesitant in buying electric cars. In such a situation, Honda may prepare to strengthen the hybrid lineup by diverting its resources from EV projects. However, it is a matter of relief that the company’s motorcycle business is still performing strongly, which is compensating to some extent the losses in the car business.