From 2027, Honda will begin launching next-generation hybrid models featuring an all-new hybrid system and platform, with plans to launch 15 next-generation hybrid models globally by the end of FY30.Honda Motor Co. on Thursday announced a strategic reset of its automobile business, shifting focus towards hybrid vehicles and cost restructuring amid changing global market conditions, while reaffirming its long-term carbon neutrality target.
The Japanese carmaker also reiterated its focus on the Indian market, with plans to leverage its strong two-wheeler base in the country, where it sells nearly six million motorcycles annually, to capture step-up demand from motorcycle customers moving to cars.
Honda Director, President and Representative Executive Officer (Global CEO) Toshihiro Mibe, speaking at a business briefing on May 14, in Tokyo, Japan, said the company will rebuild its automobile business structure over the next three years by improving its cost base, increasing development efficiency and reallocating resources to priority regions.
Honda is targeting consolidated operating profit including motorcycles and financial services of more than 1.4 trillion yen, an all-time high, in the fiscal year ending March 31, 2029.
Honda’s India plans
In India, Honda said it will begin introducing strategic models tailored for local demand from 2028, targeting two key categories — vehicles under four metres in length and the mid-size segment. Honda also said it has established Honda Digital Innovation India and will utilise a captive finance company in India, expected to become operational before the end of FY27, to support sales expansion.
The carmaker plans to increase annual motorcycle production capacity from 6.25 million units to around 8 million units by 2028, while strengthening its position as an export hub.
Hybrid push takes centre stage
A key pillar of the new roadmap is a stronger push for hybrid vehicles. Honda said it will reallocate more development and production resources towards hybrids, which are currently witnessing high demand. From 2027, Honda will begin launching next-generation hybrid models featuring an all-new hybrid system and platform, with plans to launch 15 next-generation hybrid models globally by the end of FY30, primarily in North America. It also plans to introduce large-size hybrid models in the D-segment or above in North America in 2029.
Honda showcased two prototypes at the briefing — the Honda Hybrid Sedan Prototype and the Acura Hybrid SUV Prototype — scheduled to go on sale within the next two years.
The carmaker said it is aiming to reduce the cost of its next-generation hybrid system by more than 30 per cent compared to the hybrid system introduced in 2023. It also plans to improve fuel economy of next-generation hybrid models by over 10 per cent, while enhancing driving performance through a new electric AWD unit.
The company said it is also progressing with the development of next-generation ADAS (advanced driver assistance systems), with a planned market launch in 2028. The automaker aims to apply the technology to more than 15 models over five years.
Long-term EV roadmap continues
Despite the pivot towards hybrids, Honda reiterated its commitment to achieve carbon neutrality by 2050 through a multi-path approach including EVs, hybrids, carbon-neutral fuels and offset technologies.
Honda said it will continue development of all-solid-state batteries and apply its ASIMO OS software not only to EVs but also to hybrid models.
“Honda will focus on rebuilding its automobile business structure over the next three years and strive to achieve consolidated operating profit… of more than 1.4 trillion yen, setting an all-time high,” Mibe said.
The company is pursuing a “Triple Half” approach to reduce development cost, development timeframe and development workload by half compared to 2025 levels.
Honda plans to halve development timelines for minor model changes starting this fiscal year, and for full model changes beginning with projects starting in 2028.
