When Honda Motor Co. in Japan announced March 14 that it was scrapping plans for three electric vehicles to be made in Ohio, local officials remained outwardly optimistic, despite Honda being told to retool its manufacturing plants in Marysville and East Liberty in Union and Logan counties, respectively.
U.S. tariffs, waning demand for electric vehicles and economic uncertainty had forced executives in Tokyo to cancel development of its 0-Series SUV, 0-Series Saloon and Acura RSX, each of which were to be built in Ohio.
But in a May 14 news release, the company announced another shift in plans, to now produce more hybrid and conventional-engine vehicles in North America, including in Ohio.
Jubilence has now been added to the optimism, as the company that’s been a mainstay in central Ohio for almost half a century appears to have right-sided its strategy.
“I think it’s positive news. it’s a great step forward,” said Eric Phillips, Union County’s economic development director.
There are more than 14,000 Honda workers in Ohio, most in Logan and Union counties, but also in Anna in Shelby County where engines are built.
“What’s remarkable about Honda is that they’re going to celebrate 50 years in Ohio in a couple of years. And that’s a great milestone. They were the first ‘Intel’ in Ohio,” Phillips said of the automaker’s comparison to the semiconductor giant’s projected $28 billion investment at its New Albany foundry. “They’ve (Honda) invested upwards of $16 billion in Ohio, with over half that in Union County.”
Starting in 2027, Honda will begin launching its next-generation hybrid models. The vehicles will have all-new hybrid systems and platform, Toshihiro Mibe, director, president and representative executive officer of Honda, said in remarks from Tokyo.
By the end of 2030, Honda is planning to launch 15 of these next-generation hybrid models globally, primarily focused in North America, which is a priority region, according to Mibe. The lineup will include large-size hybrid models.
Honda is striving to reduce the cost of its next-generation hybrid system by more than 30% compared to the hybrid system introduced in 2023, according to the company.
Details have not been released regarding where in Ohio, or elsewhere, the new vehicles would be built. The company has other manufacturing plants in Alabama and Indiana.
Phillips said that locally, Honda can simultaneously produce two or three models at a time in its factories and that pivoting to a new product line would not be difficult.
“They can make any type of vehicle and can switch back and forth. It’s very versatile. They’ve always been a smart company making great decisions,” said Phillips. “They’re pivoting to make themselves more profitable.”
Ohio remains ‘critical to Honda’s success,’ company says
Honda spokesman Chris Abbruzzese said Ohio’s operations “have never been more critical to Honda’s success – both today and in the future.” The company has “highly flexible automotive manufacturing … focused on meeting the needs of our customers, including the growing demand for hybrid vehicles while continuing to offer affordable gasoline-powered models.”
Underlying the optimism was initially a concern, however, especially when Honda’s first-ever losses were reported in March at $9 billion, largely due to the slide in demand for electric vehicles.
“I think overall, especially in central Ohio, where (the region) developed around Honda’s presence, definitely it can concern us, that things are going to be okay,” said Noriko Mills, executive director of the Japanese-America Society of Central Ohio.
And there are also questions about sustainable energy taking a backseat to fossil fuels in powering cars.
“The political environment is not certain, and the current administration is going away from clean energy to regular oil and gas. And that is not helping the community or the United State in going to clean energy. And we are a very automotive-driven society,” said Mills, who recently retired from Honda after more than 28 years in human resources.
But not taking bold action to reverse the red ink could be dire.
“If we don’t pivot right now, it could be worse. We have to trust the leadership of Honda. And Honda has been very resilient,” Mills said.
The company has also emphasized greater production efficiency and strengthening profits, all while making its vehicles able to connect to existing autonomous infrastructure, like the 35 miles of Route 33 “smart highway” between Dublin and East Liberty, said Phillips. The concept was to create a “living lab” for testing autonomous and connected vehicle technologies.
The company announced a next-generation advanced driver assistance systems (ADAS) with plans for a market launch in 2028. And Honda plans to apply ADAS to more than 15 models over the next five years.
Vehicles currently have sensors and computer upgrades added to improve safety. But Honda’s approach “allows that connectively from radio waves instead of sensors… they want all their vehicles to have it,” said Phillips.
“We focus so much on the EV, but the autonomous vehicle is something that saves lives, and that’s so important,” Phillips said.
Jeffersonville battery plant sees adjustment with hybrid switch
Honda’s joint venture with LG Energy Solution, called L-H Battery Company and operating in Fayette County, will convert parts of its Jeffersonville production lines to hybrid battery production.
“The future business opportunities outlined by Honda align with the technology and manufacturing expertise we have developed thus far at L-H Battery,” said Caroline Ramsey, company spokesperson.
In addition to North America, Honda has also positioned Japan and India as priority markets. In addition, Honda will pursue similar initiatives in China, where Honda strives to fundamentally strengthen its competitiveness.
Growth and development reporter Dean Narciso can be reached at dnarciso@dispatch.com.
This article originally appeared on The Columbus Dispatch: Honda’s pivot from EVs to hybrids could be big for Ohio, local leaders say
Reporting by Dean Narciso, Columbus Dispatch / The Columbus Dispatch
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