Honda Stock Price Decline Expands, 2025 Fiscal Year Net Profit Forecast Revised to Massive Loss

On March 13, Honda’s stock price fell further, dropping by 6.5% latest.

In terms of news, the company announced on the 12th that its consolidated net profit forecast for fiscal year 2025 (April 2025 to March 2026) has been revised to a loss of 420 billion to 690 billion yen (approximately 18.2 billion to 29.8 billion RMB). This is the first time since its listing in 1957 that the company has reported an actual loss, compared to a previous forecast of a profit of 300 billion yen. The company stated that the main reason is the decline in demand for pure electric vehicles (EVs) in the U.S., leading to the suspension of development for three models planned for North American production.

The U.S. Trump administration’s removal of vehicle purchase tax incentives and other policies have created headwinds for EVs, causing significant losses for companies like General Motors (GM) and Ford.

As Honda adjusts its EV strategy, it is expected to include operating expenses of 820 billion to 1.12 trillion yen in fiscal year 2025. Expenses and losses related to this may also be recorded after 2026, and combined with the losses in 2025, the total could reach up to 2.5 trillion yen. The company explained that the recorded losses include not only the write-down of molds and specialized equipment but also compensation to suppliers.

Honda President Toshihiro Mibe stated during an online press conference that demand for EVs has sharply declined. Despite various measures, profitability remains challenging. Continuing production and sales under these conditions could lead to further losses.

The three models that have been discontinued are the EV series Honda SALOON and SUV, as well as the Acura RSX, a high-end brand launched in North America.