Why Honda's First-Ever Loss and EV Retreat Are Forcing CEO Toshihiro Mibe To Pivot To Hybrid Cars

Honda is in a weird spot, at least by its usual standards. It just faced its first full-year loss ever, and the company canceled three electric vehicles that were planned for the U.S. It also canceled its planned collaboration with Sony on the Afeela EV. It also said that current popular models using internal-combustion engines would have their generational lifespans extended.

Not only that, but it's pulling out of the South Korea market, apparently closing an assembly plant in China, and reportedly freezing plans to build a large hub for building EVs in Canada.

Finally, Honda is likely to delay its timeline for implementing autonomous driving in its vehicles.

The company also has real-estate woes involving its home offices in Tokyo and its Formula One partnership with Aston Martin has had problems. Honda is supposed to supply Aston with engines, but problems with said engines have kept the team at the bottom of the constructors' standings.

What Torque News Found About Honda's F1 Problems

For those who don't follow racing in general or Formula One specifically, Honda's pairing with Aston Martin to provide F1 engines didn't go well at first. Aston Martin drivers completed just one race of the first three -- there were four retirements and one unclassified finish. 

Then F1 had an unplanned five-week break, and Honda engineers studied one of the cars during that time. When racing returned with the Miami Grand Prix earlier this month, Aston Martin drivers finished the race. They also completed the sprint race.

With vibration and reliability issues fixed, now the focus is on performance.

While F1 racing is separate from Honda's consumer product planning, the struggles add to public-relations problems caused by the sudden cancellation of EV plans, as well as the decision to extend the lifespans of aging platforms.

Honda Will Go Deep On Hybrids

So, with all that tumult in mind, Mibe is expected to present a plan that leans hard on hybrids.

Mibe came to Honda with a plan to move the brand away from internal-combustion engines and towards EVs by 2040. Now, as he faces the problems documented above, Mibe is expected to present a new plan. This updated road map to the near future will be reliant on hybrids -- Honda is developing new hybrid powertrains for small, medium, and large vehicles.

The small powertrain will likely be aimed at the Japanese market, with a 10 percent reduction in physical size.

The hybrid for mid-size vehicles will use a 2.0-liter direct-injection four-cylinder, while the powertrain for large vehicles will pair with a new V6. The large setup will use dual electric motors for all-wheel drive and is targeted for vehicles like the Honda Odyssey, Passport, and Pilot. Meanwhile, the mid-size vehicles will also get a new transmission and improved cooling, and the system will be 25 percent smaller. Honda also promises better rigidity and less noise from the new vehicles -- as well as better occupant protection in the event of a collision.

Honda currently sells only four hybrid models -- it's expected to launch 13 new hybrids under this new plan.

About The Author

Tim Healey is an experienced automotive writer and editor from Chicago. He has covered automotive news at Consumer Guide Automotive, Web2Carz, AutoGuide, and was the managing editor at The Truth About Cars. Tim is a member of the Midwest Automotive Media Association. You can find him on Facebook, X/Twitter, and on LinkedIn.