Honda: Why Electric Cars Are Not The Priority
Honda’s Journey to Carbon Neutrality
Honda, one of the world’s leading car manufacturers, no longer considers electric cars as the only solution to achieve carbon neutrality. Although previously the company allocated large funds for electrification, they are now reevaluating the strategy and considering various technology options that can help achieve these environmental goals.
Last year, Honda allocated 10 trillion yen (about $68 billion) for the electrification project. However, a few months later, the budget was reduced by 30 percent. This shows that the company is starting to look more broadly ahead and not just focus on electric cars.
Honda’s long term goals
Nonetheless, Honda remains committed to long-term targets to achieve carbon neutrality in all of the company’s products and activities by 2050. In a recent statement, the company stated that electric cars are not the only way to carbon neutrality. They believe that there are many ways to achieve this goal, including the use of other technologies such as hydrogen fuel cell vehicles.
Honda Australia CEO, Jay Joseph, explained that a battery electric car is one of several ways to achieve carbon neutrality. He emphasized that the company is developing a solid-state battery and will also develop other technologies that support the achievement of these goals. One example is the CR-V E:FCEV, a fuel cell vehicle with a plug-in hybrid feature equipped with a 17.7 kWh battery.
Competition in vehicle technology
Apart from Honda, other car manufacturers such as Toyota and Hyundai also remain committed to the development of hydrogen-fueled vehicles. Even BMW plans to launch a fuel cell vehicle in 2028 in collaboration with Toyota. On the other hand, Stellantis recently abandoned hydrogen efforts and called it a “special segment”.
Toyota, which is another Japanese brand, believes that the powertrain diversity still has room to develop. They believe that the hydrogen combustion engine can be an alternative to electric cars. Together with Mazda and Subaru, Toyota is developing a carbon-neutral engine that can use liquid hydrogen, biofuels, and synthetic fuels.
Infrastructure challenges
Even so, the hydrogen refueling infrastructure is still very backward. According to H2Stations.org, only about 1,160 refueling stations operated globally at the end of last year. The infrastructure for synthetic fuel is even less, with only a few exceptions such as the Porsche pilot plant in Chile.
Some people argue that car manufacturers are catching up with hydrogen and synthetic fuel, but skepticism of electric cars is still there. One of the figures who are often mentioned is Akio Toyoda, CEO of Toyota. In early 2024, he estimated that battery electric cars would never exceed the 30 percent market share. However, the data shows that electric cars are getting more and more popular.
electric car battery growth
The International Energy Agency (IEA) reported that conventional electric cars accounted for more than 20 percent of global sales by 2024 and are on track to surpass 25 percent this year. China is the main driver of demand, while Europe has also shown significant growth. According to the European Association of Car Manufacturers, EV accounted for 17.5 percent of new car sales in the first half of 2025, up from 13.9 percent in the same period last year.
With this development, it seems that the electric car battery will continue to get attention and support from the market. However, Honda and other manufacturers remain committed to a broader approach, taking into account various technologies as part of the carbon neutrality strategy.
