©Mufid Majnun via Unsplash
Japanese automaker Honda posted a billion-dollar loss in the 2025-2026 fiscal year. This also marks a historic first for the company as it has never before closed a fiscal year at a loss.
The Japanese automaker was significantly affected by U.S. import duties and more than 7.7 billion euros in restructuring costs related to its electric vehicle (EV) business. Honda still closed the previous fiscal year with a profit of 1.2 trillion yen (6.5 billion euros). Below the bottom line, however, is a hefty loss of 414.3 billion yen, or about 2.24 billion euros, for 2025-2026. A solid uppercut for the Japanese company since it has never been loss-making since its founding in 1948. However, Honda has some cards up its sleeve to once again build on past success.
Honda is the second largest Japanese automaker after Toyota and got into trouble because of its strategy around electric driving. As a result, the company had to write off billions. Moreover, in the United States, demand for electric cars cooled, while Honda could not capitalize on the growing popularity of hybrids. U.S. import duties also played firmly into Honda Motor's hands. At the same time, it faces stiff competition from local producers of electric vehicles in China, the world's largest car market.
Still, investors reacted positively to the figures. They said the outlook for the fiscal year ending in March was still better than expected. Despite those challenges, Honda expects to return to profitability this year by cutting costs and leveraging its profitable motorcycle division.
©Mufid Majnun via Unsplash