EV Fiasco: Honda’s Profits Drop 42% Due to Electric Vehicle Charges

Honda Motor has reported a 42 percent decline in its profits from April to December of 2025, as the Japanese automaker navigates challenges from U.S. tariffs and electric vehicle asset write-downs.

The Wall Street Journal reports that Honda reported a massive 42 percent decline in net profits for the nine months ending in December, falling to 465.44 billion yen, equivalent to approximately $2.99 billion, compared to the same period the previous year. Despite these weaker results, the company maintained its annual profit forecast, signaling confidence in its ability to navigate current market challenges.

A significant factor in the profit decline was the company’s decision to book 267.1 billion yen in one-time provisions and impairments. These charges were related to electric vehicles sold in the United States and the write-down of EV development assets due to changes in the company’s vehicle lineup strategy.

The impairments reflect Honda’s broader strategic shift in its electric vehicle approach. In May, the automaker announced plans to reduce its EV investment by approximately $20 billion over the coming years, citing slower-than-expected demand growth for electric vehicles.

Breitbart News previously reported that Honda will refocus on hybrid vehicles instead of EVs:

On Tuesday, the Japanese automotive manufacturer said it will miss its previous goal of having electric vehicles account for 30 percent of Honda’s total car sales by 2030, according to a report by InsideEVs.

“Based on the current market slowdown, we expect EV sales in 2030 to fall below the 30 percent that we previously targeted,” Honda CEO Toshihiro Mibe said.

Mibe added that EVs might make up around 20 percent of the automaker’s vehicle sales by the end of the decade.

Beyond tariffs and EV-related charges, Honda faced operational disruptions in North America. The company’s automotive production was hampered by a shortage of semiconductor chips from Dutch supplier Nexperia late last year. This shortage occurred amid a diplomatic dispute between the Dutch and Chinese governments over control of the semiconductor manufacturer, highlighting the vulnerability of global automotive supply chains to geopolitical tensions.