Honda books ¥484.8bn of EV losses in one quarter, raises profit forecast

Honda Motor booked ¥484.8 billion of EV-related losses in operating profit in the July–September quarter and still raised its full-year operating profit forecast by ¥130.0 billion to ¥780.0 billion, according to the first-half results it presented on November 10, 2026. At the 156 yen per dollar Honda now assumes for the year, the loss comes to about $3.1 billion by our conversion.

The bill is the second installment of a strategy change. In the fiscal year ended March 31, 2026, Honda revised its product launch plans and cancelled the development and market launch of certain EV models, its results filing says, and its EV-related losses in operating profit that year came to ¥1,453.6 billion. This quarter's charge is ¥479.2 billion of incremental expenses related to the strategy change plus ¥5.6 billion of disposals and impairments of development assets and equipment. The filing says the additional provisions mainly include ¥508.7 billion of compensation to suppliers in connection with the procurement of parts for EV models, based on discussions with the suppliers. One payment stayed in the family: an affiliate booked a ¥41.8 billion net gain on compensation from a Honda subsidiary, part of a ¥49.7 billion equity-method gain that brings the quarter's net EV bill to ¥435.1 billion.

Quarterly operating profit fell 39.2% to ¥117.9 billion, from ¥193.9 billion in July–September 2025. Excluding EV-related losses, adjusted operating profit more than doubled to ¥602.8 billion. Honda kept its full-year EV-related loss forecast at ¥520.0 billion, unchanged from August 5, which by our arithmetic leaves about ¥35 billion for October through March.

The same presentation announces a new auto plant in Ohio to meet growing hybrid demand in North America, and Honda aims to lift North American capacity from 1.67 million to 1.91 million units in 2029. Honda sold about 12,000 EVs at retail worldwide in the quarter, down from about 32,000 in July–September 2025, against about 244,000 hybrids. Honda's plant announcement puts the Ohio factory, which it says can also build battery-electric vehicles, at $3 billion: roughly what the quarter's EV losses came to.