Blitz Bureau
NEW DELHI: In a shock move, Honda has cancelled the 0 Series SUV and sedan just months before they were set to enter production in the USA. This comes as the Japanese carmaker is looking to restructure its global EV strategy in face of a challenging financial situation.
The Honda 0 Series SUV was India-bound this year as a full import, but even that stands cancelled. However, the smaller, made-in-India 0 Alpha SUV is still on track.
The carmaker said that major policy changes in the US have created an “unfavourable impact” on the business. The Trump administration recently rolled back incentives on buying and manufacturing EVs allotted by the previous administration, and has also impacted profitability by imposing unfavourable tariff policies on gasoline and hybrid vehicles.
“Honda determined that starting production and sales of these models in the current business environment, where the demand for EVs is declining significantly, would likely result in further losses over the long term,” the company said in a statement.
The other factor that has impacted Honda’s profitability is growing competition from Chinese carmakers. It highlighted that customers in China are increasingly leaning towards software-based features and moving away from traditional hardware features. As a result, there has been a rapid emergence of new EV players who have leveraged their short development cycles in areas such as software-defined vehicles (SDVs) and ADAS technologies. By Honda’s own admission, this has led to a “decline in the competitiveness of Honda products”.
The write-down decision will result in losses directly attributed to the cancellation of 340 billion to 570 billion yen (£2.7bn) this financial year, Honda said. It warned that further losses in the next 2026-27 financial year are expected due to this decision.
“Honda automobile business has fallen into an extremely challenging earnings situation due to various factors, including its inability to respond flexibly to these changes in the business environment, compounded by a decline in the profitability of gasoline and hybrid models due to the impact of newly imposed tariffs,” the company said.
The write-down decision will result in losses directly attributed to the cancellation of 340 billion to 570 billion yen (£2.7bn) this financial year, Honda said. It warned that further losses in the next 2026-27 financial year are expected due to this decision.
Impact on India
In last October, Autocar India had exclusively reported that the 0 Series SUV was India-bound in 2026 as a flagship technology showcase. However, that’s off the cards now, with plans of production cancelled in the US.
Of greater importance to the Indian market is the smaller 0 Alpha SUV, which is one of the seven models originally planned under Honda’s 0 Series of EVs, and will be manufactured in India for both domestic and export markets. Autocar reached out to Honda India for a statement and was assured that “there are no changes to the India EV plans.” A Honda India spokesperson said, “The 0 Alpha SUV is still on track.”
In order to counter the losses, Honda will reorganise its businesses in key and emerging markets, with the company noting, “Honda will enhance the model line-up and cost competitiveness in India, where market expansion is expected.” The brand will also restructure its business around EVs, implementing what it calls a more flexible approach to future electric model launches.