Honda is phasing out key models and closing plants in China as sales plummet and EV competition rises. See which models are affected. Read more!
Honda is currently undergoing a significant strategic retreat in the world’s largest automotive market. Facing a steep decline in demand and fierce competition from domestic electric vehicle (EV) giants, the Japanese automaker is aggressively scaling back production and phasing out several key models across China.
A Dramatic Slump in Sales
The numbers tell a sobering story. According to recent data, Honda’s sales in China plummeted by 48.3% in April compared to the same period last year, with only 22,595 units sold. The downward trend continues on a larger scale; year-to-date sales have dropped by 28%, totaling 145,065 vehicles.
This decline has forced Honda to enter a “warehouse clearing” phase, where dealerships are tasked with selling off existing inventory rather than receiving new shipments from the factories.
The “Death Row” of Models
Several popular models are now in the process of being phased out or seeing their production drastically reduced. Honda is currently adjusting its operations for the following vehicles:
- Honda ZR-V: This compact SUV has seen a staggering price collapse. Once launched at 210,000 NDT (approx. $29,900), some inventory is now being liquidated for as low as 84,800 NDT (approx. $11,700) to clear stock.
- Honda Fit & LIFE: The iconic hatchback (Fit) and its twin (LIFE) have largely stopped accepting new orders. Dealerships are now solely focused on selling remaining stock.
- Honda Accord e:PHEV & e:NS1: Even Honda’s electrified offerings aren’t safe. The e:NS1 electric SUV has seen a significant sales drop due to the overwhelming dominance of local Chinese EV brands.
- Honda Integra: Production for this sedan is being narrowed, with manual transmission versions disappearing entirely as the factory focuses on a limited number of specific trims.
Structural Downsizing: Plant Closures and Capacity Cuts
The production cuts are part of a wider structural reorganization. Honda operates in China through two main joint ventures: GAC Honda and Dongfeng Honda. Both are now feeling the pressure.
The Huangpu plant under GAC Honda—responsible for the ZR-V, Fit, and Integra—is expected to cease production by June. Meanwhile, Dongfeng Honda’s facilities are projected to close as early as 2027.
Following this restructuring, Honda’s annual internal combustion engine (ICE) production capacity in China is expected to shrink from approximately 1.2 million vehicles to just 720,000 units.
A Broader Trend for Japanese Automakers
Honda is not alone in its struggle. Toyota, another titan of the Japanese auto industry, is also seeing its influence wane in China. In March, Toyota’s sales dropped by 8% year-on-year, and its market share has consistently declined for two consecutive periods this year, sitting at 7.7% in March.
The rise of affordable, high-tech domestic EVs in China has created a challenging environment for legacy manufacturers. For Honda, the shift toward a leaner operation is a necessary survival tactic in a market that is rapidly pivoting away from traditional combustion engines toward a software-driven, electric future.