By ZHOU Shuxi
Facing declining sales, Dongfeng Honda has come up with an aggressive plan to transition to full EV production, aiming for over 50 percent electrification by 2025 and ceasing new fuel vehicle releases in 2027. Success depends on coming up with competitive vehicles.
Swift transition is critical
One of the most successful ICE car makers in history, Honda's impression on the NEV market so far has been negligible.
Currently, Honda offers only one pure EV, the unpronounceable e:NS1, with sales this year still below 3,000. The e:NS2 will not be along until 2024. In the hybrid segment, the CR-V and Inspire attracted little interest. A quick transition is essential.
In the first half of this year, Honda sales declined by 32.8 percent, the worst performance among mainstream JV brands in China. Sales of its CR-V, Civic, and XR-V slumped to varying degrees.
Domestic brands dominate
The lack of competitive NEV offerings has knocked on to losses in the fuel vehicle market. In contrast, Chinese domestic brands are rising rapidly due to cost-effectiveness and meeting younger consumers’ tech expectations.
Chinese domestic brands may surpass foreign brands in market share for the first time this year. The 50-50 equity joint venture model is becoming challenging to sustain.
The Chinese NEV market is dominated by domestic brands, influencing consumer expectations. Some perceive joint venture brands as lagging in the NEV domain.
All-electric future
In China, electric vehicles are projected to account for over 50 percent of sales by 2030. Most automakers have laid out electrification goals.
Various automakers, including Volkswagen, have announced ambitious electrification plans. Volkswagen aims to stop selling gasoline vehicles in Europe by 2035.
Honda hopes to create a new independent brand and accelerate launches. Upgrading existing stores and establishing new community shops are part of their marketing strategy.
