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fliptop writes:

Honda is deepening its retreat from an aggressive electric vehicle rollout, canceling three U.S.-bound EVs and warning that the shifting market could result in major financial losses as it pivots toward hybrids:

The automaker recently announced it will halt development and launch plans for the 0 Series SUV, 0 Series Saloon and the Acura RSX. Those models had been slated for U.S. production as early as this year following factory retooling tied to Honda’s next-generation EV strategy.

Honda said the decision reflects a rapidly changing business environment, including slower EV demand, tariff pressures and weaker-than-expected product performance in key markets.

“Honda determined that starting production and sales of these three models in the current business environment where the demand for EVs is declining significantly would likely result in further losses over the long term,” the company said in a statement.

The financial impact is substantial. Honda said total losses tied to the move could reach as much as $15.8 billion. That includes operating expenses projected between roughly $5.2 billion and $7.1 billion in the current fiscal year, reversing what had been an operating profit forecast just one month ago into an expected operating loss.

[...] Honda’s challenges extend beyond North America. The automaker acknowledged it has fallen behind competitors in China, particularly in EV cost competitiveness and in-vehicle software. Sales in China dropped sharply last year, further weighing on overall performance.

Previously:

• Honda Will Build a CR-V-Based Fuel Cell EV in Ohio in 2024
• Honda and LG are Investing $3.5 Billion in New Ohio Battery Factory

Original Submission

fliptop writes:

Battery maker LG Energy Solution's second-quarter profit dropped 58% year-on-year to 195.3 billion won ($141m), the company said on Monday (8 July), as demand for electric vehicles (EVs) slows:

The South Korean-based battery company also saw its revenue drop 30% to 6.2 trillion won ($4.4bn).

The company also faces increased competition from its Chinese rivals, which has weakened its share of the market.

Car manufacturers have been calling for battery companies to create cheaper cells to lower EV prices, which has applied pressure to companies like LG Energy.

This led to LG Energy's chief technology officer, Kim Je-Young, stating that the company would commercialise dry-coating technology by 2028, a technology which makes battery manufacturing cheaper and more efficient.

Battery maker SK On declares 'emergency' as EV sales disappoint. Supplier to Ford and Volkswagen may have to be rescued by its South Korean parent as losses mount:

A leading South Korean producer of electric vehicle batteries has declared itself in crisis as its customers struggle with disappointing EV sales in Europe and the US.

SK On, the world's fourth-largest EV battery maker behind Chinese giants CATL and BYD and South Korean rival LG Energy Solution, has recorded losses for 10 consecutive quarters since being spun off by its parent company in 2021. Its net debt has increased more than fivefold, from Won2.9tn ($2.1bn) to Won15.6tn over the same period, as western EV sales have fallen far short of its expectations.

With losses snowballing, chief executive Lee Seok-hee announced a series of cost-cutting and working practice measures last Monday, describing them as a state of "emergency management".

[...] SK On has made a series of aggressive investments in the US and Europe in recent years, betting on a widely predicted boom in demand for EVs. However, it has since announced extended lay-offs for workers at its plant in the US state of Georgia and delayed launching a second plant in Kentucky, a joint venture with its principal US customer Ford.

Previously:

• LG Energy Solution to Spend $3 Billion to Expand EV Battery Production in South Korea
• Honda and LG are Investing $3.5 Billion in New Ohio Battery Factory
• Ford Motor Company is Planning a Big EV Future

Original Submission

fliptop writes:

LG Energy Solution said on Monday that it will spend 4 trillion won, or approximately $3.07 billion, up until 2026 to expand its electric vehicle (EV) battery production in South Korea:

The funds will go into expanding and building new battery production facilities at the Ochang industrial zone located in Cheongju, the capital city of North Chungcheong Province southeast of Seoul. LG Energy Solution already operates a cylindrical battery production facility at Ochang.

Additional production lines to be built there will adopt the latest smart factory solutions such as logistics automation, remote support, and intelligent manufacturing, the South Korean battery maker said.

The local governments of North Chungcheong Province and Cheongju said they will provide financial and administrative support to LG Energy Solution for the plan. The move by the company is expected to create around 1,800 new jobs.

Previously: Honda and LG are Investing $3.5 Billion in New Ohio Battery Factory

Original Submission

fliptop writes:

As a metric of just how much damage the push to "electrify" everything on wheels has caused [Ed's Comment: In the USA] , it's hard to surpass Honda CEO Toshihiro Mibe's announcement the other day that Honda – Honda! – suffered its first-ever money-losing year last year:

"The outlook is very challenging. However, we would like to explain the circumstances leading to this management decision and the future direction for rebuilding the mid-to long-term strategy for our automobile business," he said.

[...] Honda – like a number of other vehicle manufacturers that drank the EV Kool Aid – has cancelled several pending EVs that had been scheduled to make their debut this year, including the entire "0" series. It turns out zero will be made, which is better than zero dollars being earned (and many dollars probably lost).

"We made this decision with a heavy heart, believing that introducing these three models to market without an outlook for business viability may lead to an early discontinuation of production, which could cause a concern and inconvenience to our customers as a result of potential damage to the value of the Honda brand."

The Prologue – Honda's first EV – is also the first Honda to be cancelled after just three years of availability. It ought never to have seen the light of day – and not just because it's another over-priced ($40k to start) crossover that goes half as far as $25k gas-engined crossovers and tethers its owner to a charge cord – but also because it wasn't even a Honda. It was a reskinned Chevy Blazer EV, with some trim/feature tweaks. This saved Honda some money, by not wasting it on R&D'ing its own EV – but it also arguably damaged Honda's brand, something far more costly.

Previously:

• Honda Hits Brakes On EV Rollout Amid Rising Losses
• Honda Shows Low Speed, Narrow BEV for City Delivery
• Honda and LG are Investing $3.5 Billion in New Ohio Battery Factory

Original Submission