Honda to close China plant(s)

Honda is preparing to shut at least one gasoline-car plant in China this year as it cuts capacity in a market that has turned sharply toward electric models. (msn.com) Two people familiar with the plan told Reuters that Honda will halt a plant run with Guangzhou Automobile Group this year and may suspend another with Dongfeng Motor Group in 2027. Honda has six car plants in China across those two joint ventures. (msn.com; autonews.com) Toyo Keizai reported the Guangzhou plant will close in June and the Dongfeng-linked plant could follow next year, cutting Honda’s annual China capacity to 720,000 vehicles. The two internal-combustion plants each have capacity of 240,000 vehicles a year. (asiaone.com; news.rthk.hk) Honda’s China business has been shrinking fast. Its vehicle sales in China fell to 852,269 in 2024 from 1.234 million in 2023, and Honda’s January 2026 production in China dropped 27.2% from a year earlier to 38,125 units. (gurufocus.com; global.honda) The pressure is coming from China’s rapid shift to new-energy vehicles, the local term for battery-electric and plug-in hybrid cars. In 2025, those vehicles reached about 51% of China’s new-car market, while foreign brands kept losing share to domestic makers. (oxfordenergy.org; automobility.io) Chinese groups such as BYD, Geely and Chery have been moving faster on lower-cost electric and hybrid models, while Japanese brands built their China business around gasoline cars and conventional hybrids. Reuters reported this week that Volkswagen also expects even tougher competition in China as the market slows. (cnevpost.com; msn.com) Honda is also reworking its strategy beyond China. On March 12, the company said it would cancel three electric-vehicle models planned for North America and warned it could post its first annual loss as a listed company after booking up to $15.7 billion in restructuring costs. (global.honda; money.usnews.com) Honda, Guangzhou Automobile Group and Dongfeng did not immediately respond to Reuters requests for comment on the reported China plant shutdowns. The next test is whether Honda can replace lost gasoline-car volume with enough electric and hybrid sales to keep its remaining China factories busy. (msn.com; asiaone.com)