Honda has reported its worst financial loss since it became a public company in 1957. The company revealed a loss of 423 billion yen (about $2.68 billion) for the financial year ending in March, confirming earlier predictions made in March. These figures are worse than during the pandemic years when Honda fully committed to electric vehicles (EVs) and withdrew from Formula 1 at the end of 2021.
Despite these losses, Honda stated that its financial situation will not impact Honda Racing Corporation (HRC) or its Formula 1 project. CEO Toshihiro Mibe explained that the loss is mainly due to significant investment costs in EVs. However, these investments have not yet produced the expected results, especially in the United States, where certain tax credits for EV purchases were removed.
As a response to its financial difficulties, Honda has paused an $11 billion investment plan to produce EVs and batteries in Canada. The company has also abandoned its earlier target to have 20% of new car sales be EVs by 2030 and the goal of selling only electric cars by 2040.
In the context of Formula 1, there are ongoing discussions about returning to internal combustion engines, such as V8s, powered by sustainable fuels. Some F1 teams, including Mercedes, have expressed interest in new engine regulations that would include internal combustion technology.
