Honda Reports First Annual Loss Since 1955 After EV Investment Writedown

Honda reported its first annual net loss since 1955 after recording a substantial writedown on electric vehicle investments. For the fiscal year ending in March, the Japanese automaker took a 1.6 trillion yen charge, equivalent to nearly $10 billion.

The writedown erased what would have been a $7.4 billion profit and resulted in a net loss of 403.3 billion yen, or about $2.6 billion. The company also indicated it expects an additional writedown in the current fiscal year, though not large enough to produce another net loss.

Honda's results follow similar actions by other global automakers that had invested billions anticipating stricter U.S. emissions standards and broader EV adoption. Changes to those standards and the elimination of a $7,500 tax credit for EV buyers in the United States contributed to a sharp fall in EV sales after September.

A recent rise in gasoline prices has not led to a significant recovery in U.S. EV demand. Automakers have responded by refocusing on gasoline-powered trucks and SUVs, which generate higher profits. The industry shift has required substantial accounting adjustments for prior EV-related spending.

Motors recorded a $7.2 billion charge in 2025 tied to its reduced EV efforts but still reported an annual profit. Ford announced a $17.4 billion charge and posted a net loss for the year, while Stellantis reported a 25.4 billion euro charge, or about $29.7 billion, and also recorded a net loss.

Ford has said it expects further charges this year. Honda and its competitors have not abandoned electric vehicle development. tougher emissions rules remain in place in Europe and Asia. In the United States, California maintains a regulation that would prohibit sales of new gasoline-powered cars by 2035, though Congress has moved to block that requirement from taking effect.

Automakers also face growing competition from Chinese manufacturers that primarily produce electric vehicles. Those manufacturers currently have limited presence in the American market. Industry participants continue to monitor regulatory developments across multiple regions while adjusting investment levels to match demand.