Honda will close one of its combustion engine plants in China and pause production at another factory as part of a strategic shift towards electric vehicles (EVs). The Japanese automaker plans to open two new EV factories in China by the end of the year with its partners, GAC and Dongfeng.
The closure of the combustion engine plant, operated jointly with GAC, is scheduled for October, while production at another Honda factory, in partnership with Dongfeng, will be paused starting November. These moves will reduce Honda’s annual vehicle production capacity in China from 1.49 million to 1.2 million units.
Despite this reduction, the shift is expected to be temporary. Honda aims to focus more on electric vehicles, planning to establish two new factories exclusively for EV production. These facilities, also in collaboration with GAC and Dongfeng, are set to bring China’s annual capacity back to 1.44 million vehicles.
The new plants will manufacture the ‘Ye’ electric vehicle series, which was specifically developed for the Chinese market and introduced in April. The series name ‘Ye’ (烨) translates to “shining brightly” in Chinese.
Honda’s decision reflects a broader trend among Japanese automakers, including Nissan, who have faced challenges as electric vehicles have increasingly captured market share in China. Like Volkswagen, Honda has seen its position eroded by the growing dominance of Chinese manufacturers such as BYD, which currently leads the market in new energy vehicles.
