FAR EAST: JAPAN REPORT
Honda plans to end production of the Honda e EV by January 2024. This is the company’s first mass-produced EV, but sales have been sluggish, falling short of the annual domestic sales target of 1,000 units. Going forward, the company will focus on commercial light EVs, which will be launched in the spring of 2024, to increase the electrification rate of the vehicles it sells.
The Honda e was launched in 2020. The vehicle is priced at 4.95 million yen and has a range of 259 km (WLTC mode). Sales in Europe have already been discontinued. Sales in Japan will also be discontinued once stocks run out.
The Honda e was not originally intended to be a high-volume model, but it did not meet its sales target. The company plans to expand the model lineup, starting with the N-VAN e:, a light electric vehicle to be launched next year.
Source: The Nikkei
PSR Analysis: The Honda e was not in the luxury price range, but with its compact body size it was suitable for Japanese road conditions and wit its futuristic design, it was the right approach for the first stage of Honda’s EV penetration in Japan. The end of sales of such a flagship model shows the difficulty of EV penetration in Japan.
In the first half of 2023, 22,857 EVs (standard passenger cars) were sold, which is only about 1.67% of the total sales volume. In addition, sales of light EVs totaled 25,807 units in the first half of the year. Therefore, including mini-vehicles, total EV sales were 48,664 units, or 2.38% of all EVs sold (standard passenger cars and mini-vehicles) (PHEVs accounted for 25,163 units, or 1.23%).
Of course, not only Honda, but also Toyota, Nissan, and many other Japanese manufacturers are selling EVs, but there are many issues that need to be resolved before EVs can be widely adopted in Japan.
Weak consumer attitudes form a high hurdle for switching from existing engine models. Manufacturers and the government are promoting V2X and environmental performance, but it will take time for full-scale adoption. PSR
Akihiro Komuro is Research Analyst, Far East and Southeast Asia, for Power Systems Research
