Honda Motor on Thursday reported its first annual loss since becoming a publicly traded company in Japan seven decades ago, as the costly retreat from its ambitious electric-vehicle targets plunged earnings into the red.<\/p>\n
The automaker reported a net loss of $2.7 billion for the fiscal year that ended March 31. Earnings were weighed down by more than $9 billion in restructuring charges and write-downs following a retrenchment of its E.V. strategy. It is the first loss that the 77-year-old company has reported since listing on the Tokyo Stock Exchange in 1957.<\/p>\n
The sharp downturn underscores the extent to which Honda \u2014 and many other automakers that poured billions into electric vehicles<\/a> \u2014 has been buffeted by cooling demand.<\/p>\n \u201cThe business environment and customer demand have changed beyond our expectations,\u201d Toshihiro Mibe, Honda\u2019s chief executive, said in a news conference in Tokyo on Thursday. \u201cWe were not able to respond flexibly enough,\u201d he said.<\/p>\n Just five years ago, Honda was racing to catch up to Tesla and Chinese rivals such as BYD in building electric cars. It pledged to make its entire lineup electric or hydrogen-powered by 2040, a more aggressive transition than rival Japanese automakers like Toyota, which remained cautious about fully electric cars and continued to throw its weight<\/a> behind hybrid and gasoline-powered models.<\/p>\n For some, Honda\u2019s rapid pivot to electric vehicles was unexpected for a company long known for its mastery of the internal combustion engine. Still one of Japan\u2019s top-selling automakers behind Toyota, Honda first made inroads in the United States in the 1970s with a fleet of low-cost vehicles powered by some of the world\u2019s most efficient engines.<\/p>\n Starting in 2021, Honda \u2014 an automaker that traditionally eschewed big strategic alliances \u2014 began investing billions to develop battery-powered cars both in-house and in partnerships with General Motors and Sony, the Japanese electronics giant. For a time, its 2040 target won praise from investors and environmental groups alike.<\/p>\n However, many consumers were not quite ready. After an initial wave of early adopters propped up sales, other mainstream buyers balked, largely because of lingering concerns about charging infrastructure<\/a> and high sticker prices. Then, last year, federal subsidies<\/a> for many electric models were effectively gutted under the Trump administration.<\/p>\n