Honda Is Betting $3 Billion On Hybrids As It Pulls Back From EVs

The automaker had ambitious plans for EVs in the U.S. Now, it’s spending big on a new factory and a new hybrid lineup.

Photo by: Honda

By: Iulian Dnistran

Nov 10, at 2:54am ET

Comment

Honda is spending $3 billion on a big hybrid push in the U.S.
The company is building a new car factory in Ohio, which will be able to accommodate gas, hybrid, and electric cars.
Elsewhere, the automaker is retooling factories to get them ready for the upcoming hybrid boom.

Honda is building a new car factory in the United States, which will primarily manufacture hybrid and traditional gas vehicles. The new facility, which is estimated to cost $3 billion, will be Honda’s fourth auto plant in Ohio and the company’s ninth car-related production facility in the U.S.

The move is part of the Japanese automaker’s push to introduce no fewer than 15 new hybrid models globally, with the majority of them being destined for the American market, too. It’s also Honda’s first big step away from its ill-fated electric-car push, which ended up with a completely new vehicle platform and three EVs being retired before even one production-ready unit had rolled off the assembly line.

Honda's New Manufacturing Plant Location In Ohio

Photo by: Honda

As a reminder, the Acura RSX, Honda 0 Series Saloon, and Honda 0 Series SUV were supposed to go into production at a new EV hub in Ohio, but the entire plan was scrapped due to major financial losses. After canceling the 0 Series project, the company posted its first loss in nearly 70 years, with $9 billion going down the drain.

After the whole EV debacle, Honda decided to go back to the drawing board and chose ultra-efficient hybrids as its next big thing in the U.S. The car manufacturer is already knee-deep in the development of multiple hybrid models, with the first cars expected to debut in 2028.

To support the new strategy, Honda’s new plant, which is located right next to three of its other facilities in Ohio, is scheduled to become operational in 2029. According to the company, the new location will add over 2,000 jobs and will be able to manufacture 240,000 vehicles annually, raising the automaker’s total annual U.S. production capacity to 1.3 million cars. What’s more, the new Ohio plant will increase Honda’s hybrid powertrain system capacity by 250% in the state.

Honda's new Ohio auto plant location in relation to current Honda facilities

Photo by: Honda

All this being said, the latest Ohio factory is being built with flexibility in mind. Despite being aimed at hybrids at first, the company said that it will be able to add EVs into the mix in the future, if needed.

Elsewhere, Honda is investing in retooling factories to support its big hybrid push. The Alabama Auto/Engine Plant, the Anna Engine Plant in Ohio, the Transmission Plant in Ohio, and the Transmission Plant in Georgia are undergoing upgrades right now, adding equipment and new lines.

What do you think?

View

Comments

Earlier this year, when the car manufacturer announced its hybrid plans, two new vehicles were brought on stage: a Honda-badged sedan and an Acura-badged crossover. Neither has been confirmed, but we do know that electric all-wheel drive will be offered as part of the next-generation hybrid powertrain, and that crossovers will make up most of the lineup.

According to the Japanese automaker, the new system is designed to deliver 10% more efficiency than the current generation that debuted in 2023.