The year 2024 has not been an easy year for Honda when it comes to its business operations in China. Its revenue occupied the second place, with the unit sales decreasing to 852,269 units, a 30.9% decline. This has been the first time Honda has sold fewer than one million cars in this region in the past nine years. I think it is especially due to the competition from local manufacturers and the reduced demand for ICE (Internal Combustion Engine) vehicles. Looking at the case of Honda, one will find that the company is at the crossroads in an evolving automotive industry.

The Rise of Electric Vehicles

China has become one of the world’s largest markets for EVs, where its market share of new car sales in the past year was 40%. Leading this charge is BYD, as the Chinese carmaker associated 3.83 million of its total passenger car sales with BEVs or PHEVs. This will be four times what it sold in the past year, 2019, and diminish the market share of major brands like Honda severely. There is no doubt that the demand for electrified vehicles is now apparent, meaning that Honda had to rethink its plan in going forward there.

Strategic Production Changes

To adapt to such changes in market conditions, Honda has not remained idle as well. The idea is to reduce production of engines at a factory in Guangdong province by half and is reducing its capacity in this region. The sources, which include Nikkei Asia report, indicate that the production line in the Dongfeng Honda Engine factory is set to shut down by the end of this month. The manufacturing capability reduction at its joint venture operates at annual speeds of 520,000 units to about 260,000 units. Honda halted automotive manufacturing at its joint venture partnership with Guangzhou Automobile Group, which previously manufactured 240,000 vehicles annually.

Honda plans to decrease its local manufacturing quantity below 1.49 million early vehicles in 2024 by dropping to about 960,000 units. The news media has it that Honda is undertaking early retirement packages for those employees that are being laid off due to the shut down of the plants, further demonstrating the company’s wish to manage the change.

Embracing the Future with the S7

Honda has already joined the race towards electric vehicles, which is evident by its new addition to its fleet, the S7. This model belongs to a segment that boasts close competitors in the form of Tesla Model Y, Onvo L60 and Zeekr 7X. The S7 is currently available in two variants with 89.8 kWh battery options and up to 404 miles of range, the base model costs from ¥259,900, equivalent to $36065. It could also be seen as Honda’s strategic shift towards the future mobility in China.

End Note

I believe that the latest developmental direction of electric cars in China is very good for Honda and fittingly timed. Overall performance of the company can be attributed to the company’s ability to respond to some of these factors, as highlighted by the following insight. It is for this reason that as the global automotive industry shifts to the next phase, Honda’s determination in electrification may actually be the key to more growth and product development.

Currently, Maryland Attorney General Anthony Brown has set a massive sum to receive from Darcars Honda. Through this settlement, customers will be refunded up to several million dollars as a way of compensating for the damages caused to them by the dealership. It is still unsure about the total, but it can be stated that the dealership used many manipulations in its operations. Thus, the government alleged that the dealership submitted ‘unfair and deceptive trade practices’ that affected consumers’ interest.

What Went Wrong?

A challenge was that the Darcars Honda sold cars at a 2% ‘sales commission,’ which in fact was not a commission. And this fee was quite unlawful according to the laws of Maryland. In addition to that, through the exclusion of markups and added equipment, the dealership also advertised the vehicles for sale at cheaper prices than the actual cost of the cars. This mere deception made many customers to fall into the trap.

Moreover, Darcars Honda stated that the business engaged in the addition of various unwanted equipment and products to the sales transactions without customers’ consent. The legal bodies, as represented by the Attorney General’s Office, established that the dealership was in breach of the law to do with the disclosure of processing fees and also did not put the allowed “price statement” on every new vehicle that the dealership was displaying for sale.

Impact on Consumers

These practices significantly affected consumers. Once again, to either ‘negotiate’ or pass adequate information or price list, selling vouchers, contracts, receipts and any other related working papers attached to the relevant sales transactions failed to contain itemized breakdowns of the displayed products. One of them was taking tens of thousands of dollars to buy a number of items and being charged a commission of 600 dollars which I only saw in the papers after we left the store. I asked to have the form that they use to display the costs in their stores; they said no because it is a policy that they cannot allow me to have it.

Settlement and Its Implications

It prohibits Darcars Honda from using such practices in future and requires the recovery of funds for the affected customers. Furthermore, the dealer has offered to make a contribution to the Executive Head of the Attorney General’s Office amounting to $3 million. In a statement, Brown stated that car is one of the biggest assets, which when purchased, one spends a lot of money on. Therefore, Marylanders should not be charged even higher due to such an unlawful business strategy by a dealer.

This settlement is a clear indication of the Attorney General’s Office’s aim at preventing unfair business conducts. To my thinking, this is a good move in ensuring that the automotive industry becomes fair much as it becomes more open.

My Personal Opinion

To a certain extent, the settlement also helps to remind consumers and they should carefully read these documents every time they are in such important purchases. It is quite disheartening to read such reports, but I am pleased that the Attorney General’s Office has done something against Darcars Honda.

End Note

This case reveals why it is necessary to have some regulations that shall guard the consumers. Buyers should always be alert and ask for any segment of a purchase that he or she finds ambiguous or uncomfortable. I just hope that it brings some relief to the customers and is also capable of setting a precedence to discourage such practices in the other car dealership companies.

Japan’s major English daily newspaper, Yomiuri Shimbun, reported that Honda dared to pressure Nissan into scrapping the e-Power hybrid system and instead using its hybrid system. Concerning this proposal, Nissan was not happy and the relationship between the two companies even deteriorated. Both automobile companies remain open to future cooperation in the field of electrified cars.

The e-Power system in Nissan refers to a different category of hybrids as a whole. Unlike a typical hybrid, an e-Power system doesn’t physically couple the ICE with the wheels in any way. Rather, the ICE serves as a manner in which it forms a battery that is charged by an electric motor. This enables Nissan vehicles to simulate the execution of an electric vehicle (EV), which is proving to be distinctive from EVs and hybrids.

Nonetheless, Nissan is willing to progress its e-Power technology even after the failed merger discussion. The automaker aimed to create the 3rd generation of the e-Power system, and its efficiency will be 20% more than when they started it in 2016. Also, it is expected that this next-gen system is going to be 15% more cost-effective on highways than the second-gen setup. Nissan also wants to cut costs by 20 percent compared with the first gearing up, which was used on the Note compact hatchback.

U.S. markets form part of the strategic locations where Nissan plans to introduce its third-generation e-Power system alongside other regions. Nissan plans to begin production of the Nissan Rogue e-Power with this hybrid technology starting from the fiscal year 2026 (April to March 2027) schedule period. During fiscal year 2025-2026, from April 2025 until March 2026, Nissan will introduce a Rogue model that functions as a plug-in hybrid vehicle. The technology will launch in Japan’s minivan version starting this fiscal year 2025/26 and the Qashqai model produced in Europe around the same timeframe.

This pressure to shift strategies sees Honda pressure Nissan to drop e-Power technology in favor of its hybrid system in electric vehicles. Due to the changing perspectives of automakers across the globe to increase fuel efficiency and decrease emissions, the option of hybrid technology is considered a strategic move. It is possible that Honda preferred their hybrid system for these reasons because of their strategic viewpoints in terms of technology and market segmentation.

Although the opportunity to combine Honda and Nissan failed to come into existence, the market remains highly dynamic. However, both are crucial for the collection’s progress toward electrified transportation with different technological beliefs and developments. In this context, it can be assumed that in the coming years, many of them will remain purely offensive and at the same time cooperate and compete with each other.

Thus, the scrapped merger deal between Honda and Nissan points towards the reality of strategic management, especially in key sectors such as hybrid facilities. As the two companies have pursued rather different strategies, though, their quest for the development of electrification remains clear and unbroken. Due to the increasing awareness and shift towards sustainable automotive solutions, the developments and decisions made by car giants such as Honda and Nissan are essential in defining the future generation of vehicles.

In December, two of the Japanese manufacturers, Honda and Nissan, the second and third car manufacturers, stated that they would finalize the negotiations by June 2025 and set the formation of a holding firm by 2026.

What was equally apparent at the time of the announcement of merger talks was Honda’s message to Nissan over the organization’s operational issues. During one press conference in December, Honda claimed that Nissan’s renewal was possible only if there were plans for a merger. Nissan, which has been experiencing severe financial woes in the past year, declared a global restructuring plan in November that comprised of slashing jobs by 9000 and halting production by 20%. Yet, the plans employed through FMC and the restructuring initiatives as a comprehensive turnaround strategy did not fit the notion that Honda expected to be presented as a firm with a strong and well-substantiated strategy.

The disagreements followed the issue of the structural form through its progressive stages as a merger. However, Honda proposed that Nissan should be made one of its subsidiaries so as to guarantee the long-term future of the partnership. This move was instigated as a result of the low rate at which Nissan was adopting channel change strategies, a factor that Honda did not want to allow to compromise on network merger success. However, this move was not very well accepted at Nissan’s board level, hence a clear sign that the company had embraced a decisive step towards the non-merger.

The collapse of the negotiations displays the diplomacy, bargaining, and power relations that are usually evident in a partnership between two separate corporations. The situation at the early stages of the merger was filled with more expectations, but the latter was not so bright due to the differences in strategy development priorities and issues such as control and governance. The proposal to make Nissan a subsidiary was especially fraught with controversy, which can be explained by the weakening of Nissan’s authority and Honda’s desire to set up its management.

This comes after there have been several postponements on the disclosure of details concerning the synergism strategy. Scheduled for the end of January, the meeting was rescheduled for mid-February; this time was chosen due to the lack of common positions on important questions.

As the two-car majors get ready to declare their first-quarter figures covering the period to December, investor interest is likely to turn to where each car maker intends to go alone. But even in the year of the pandemic, it has become clear that when the strategic visions and, therefore, tactical needs start diverging in a fast-changing industry, such as the automotive industry with new focuses on electrification and digitalization, the alliance becomes unsustainable.

For both Honda and Nissan, those new moves will entail the need to review its strategies and map out new ways of expansion and cooperation. The automotive industry is highly competitive, and therefore it will keep its eyes on these two companies as they adjust strategies in their mission for sustainable growth.

Source: Reuters.com

A Surprising Revelation

Automakers and especially car lovers across the globe were taken for a surprise in December when two major competitors, namely Honda and Nissan, revealed that they were in discussion of joining forces and forming a single company. The consolidation of these two giants was once predicted to alter the face of the Japanese automobile market, and it came with its own set of factors that could either be an opportunity or a threat. However, it has become evident that the involved factors have made it mandatory to take time when undertaking due process.

Political Underpinnings

Former Nissan and Renault Chief Executive Officer Carlos Ghosn stated that the Hondas’ active participation in such a proposed merger may not be entirely voluntary. Specifically referring to a report by Ghosn, it can be pointed out that the Japanese Ministry of Economy, Trade, and Industry wants Honda to agree on the merger in order to steady Nissan’s financial condition. This statement suggests the existence of more profound economic schemas, which indicates that the merger is more than just for the two organizations.

Condition for Merger: Nissan’s Turnaround

It is evident that Honda’s management has stated that the merger can only take place if Nissan demonstrates its operational and financial credibility. Honda is not convinced by Nissan’s global restructuring strategies, which include sacking 9,000 people, abroad cutting production capacity by 20%, and early retirement measures implemented in three American plants.

As cited in the sources, Honda expects Nissan to undertake even deeper cost reductions, while Kyodo New reports agree on the same. Based on research done, it seems that Honda’s current leadership, headed by its President and Chief Executive Officer, Toshihiro Mibe, has the firm belief that Nissan should be ready to become a strong independent company before any merger can take place.

The Mitsubishi Question

Complicating the matter further is the role Mitsubishi plays in such forums. While rather vague, included as it is in the coordination change, Mitsubishi has made it clear that it favors stability and aims at continuing as an independent entity. The company is actually planning only a few mergers with Honda and Nissan without the intention to go full mergers.

This position puts Mitsubishi in a very good standing when it comes to looking for partnerships that suit its interests without having to go private. It seems that Mitsubishi has agreed to decide on the right course of action by this month.

Personal Perspective

Lately, I have done my best to absorb as much information as I can about the automotive industry, and I would like to believe it is wiser to postpone the development of the merger between the companies of Honda and Nissan. They are high; therefore, engaging in such a transformation procedure without a proper assessment might threaten the sustainability of the outcomes in the companies’ environments.

Honda is perfectly right to refuse Nissan the green light for restructuring until the company provides a clear plan of how it is going to go about it. For Mitsubishi, the option I spoke of its ability to stay unaffiliated may enable the firm to better respond to the successive changes shaping the market since they can probably foster more specific and advantageous contracts.

Looking Ahead

Some of the issues affecting the automotive industry include new trends in consumer interests and the shifting to electric cars, and some decisions made in addressing such matters will thus be keenly observed. The impact on decisions throughout the sector will be inevitable in one way or another, depending on whether the merger takes place or not. At this moment, there is only the specified mid-February when both Honda and Nissan will comment something on the topic. Up until now, the industry is “on standby,” eager to find out how these giants of Japanese car manufacturing will define their further development.

Therefore, the fact that Honda and Nissan have postponed the announcement of their merger update to mid-February shows that such a large-scale measure is not decided easily. This is achieved while stressing internal reorganization, external forces, and positioning strategies. I will therefore wait for future developments, which remain a clear indication of the dynamic world of the automotive industry.

It is the partnership of these two giants these two giants began in March 2024 and then it was growing. An MOU for the strategic avenues of cooperation in the automotive area of vehicle intelligence and electrification has been made, causing the brands to be completely intertwined. Another agreement was made in August to deepen the cooperation in other technological sectors. Now that the idea of part integration is gradually transitioning to full integration, it is high time to consider what we have learned so far.

In the next few months, a committee of staff from the two brands will review the modalities of integrating operations. The extensive review will include vehicle platform, research and development cooperation, product integration and procurement systems, financial integration, operational optimization, and human resource integration. At the moment, the plan calls for a clear and binding understanding of the business integration to be reached by June, 2025. Then there would be government approval for the merger required and approval from the shareholders of the two companies, namely Honda and Nissan, which is in April 2026.

However, as stated within the new merger, they will both retain their separate identities, just like Stellantis does today. But they will both continue to be parts and platforms, although to be called a new, as yet unnamed, company. As for the equity, Honda and Nissan would be delisted from the Tokyo Stock Exchange and then be succeeded by the new holding firm by late summer 2026. I find it quite peculiar that Honda would become a majority in controlling the management of the new company.

However, a crucial component left out of this announcement regarding a joint venture is Renault and Mitsubishi. Both companies entered into an alliance with Nissan in 1999 and at the moment, Renault owns the majority of Nissan. Renault Group, in their short statement, said that they shall take all possible steps in the best interest of Renault Group and its stakeholders.

If everything is smooth and this new holding company is passed with shareholder approval, then it will be taken as one of the biggest automobile conglomerates. This new upcoming merger between such giant automobile industries as Honda and Nissan is going to change the face of the global automotive industry entirely and we are eager to see more of it.

That being said, this action isn’t without its danger; it is truly a large step. For instance, prior cooperation in the automotive industry has not yielded desirable results every time. Although taken at the last minute, this move demonstrates that Honda and Nissan remain determined to remain competitive in the constantly transforming average automotive market.

Second, more aggregation of consumers and merchants might also bring greater cost-effectiveness, while synchronizing the R&D process across functions can lead to better innovative technology. For customers, this translates to possibly; better goods and, in some cases, more reasonable or relatively cheaper prices. It is a giant step towards consolidation in the automotive sector and we are looking forward to see the resultant phenomenon in the global auto market.

We eagerly expect the creation of this new holding in 2026, and we hope that the merger will be fruitful for both Honda and Nissan and for their customers, employees, and shareholders. It remains to be seen what new strategic alliance can be defined in the development of the automobile industry.

In my childhood, my father had a beautiful, shiny car, a 1990 Premode from a Honda company founded in Japan. It’s interesting how I could tell by his car form and engine that he was a smooth, intelligent, and sophisticated man. I frequently found myself seated in the right-hand front passenger seat, star-struck by the car and the glorious ride as the speed through the urban setting. It is for this reason, therefore, that expectation for the new 2025 Honda Prelude is braced with a sense of prologue.

Despite the fact that the official word from Honda is still lacking about the comeback of the Prelude, there are numerous reports about possible preparations for the creation of a new sports coupe. Although more on the car has yet to be revealed, we can look at the automaker’s latest releases to have an idea of what the new Prelude may import.

First of all, it is realistic to assume that the new Prelude will embody the liberal use of progressive and, moreover, ecological facilities. Honda has been in the hybrid and electric vehicle category and one would expect such a model in the 2025 model in order to meet a new sustainable car usage market. This could include a potent, yet efficient hybrid powertrain or a fully electric model as an option.

Apart from environmental solutions, the 2025 Prelude is expected to reflect the brand’s safety enhancement aspects. Safety has always been an area Honda has focused on, and it would make perfect sense to see the latest technology to protect drivers installed in this Prelude. Toy with collision avoidance systems today and lane-keeping assistance tomorrow, the new Prelude now has the potential to revamp safety in the market of sports cars.

Much of the fun in owning a carburetor car is therefore felt when it comes to its performance. As true with tradition in the case of Preludes, the new model would have to provide an exciting driving experience to the drivers. They hypothesized it would feature an awesome engine, most likely a turbocharged 4-cylinder, to make sure that it would have spirited acceleration. The ride height would be adjustable in order to ensure comfort as well as offer the driver that extra advantage over other motorists on the road.

Of course, the design of the new Prelude is of equal importance as well as the car’s performance features. The 2025 model would bear the perfect proportions of the aerodynamic and sporty elements with contemporary hints of modernism. That is why it is possible to speak about personal visions; thinking of a car of such type, in my mind, I can easily visualize a car with spicy lines and as low as possible look, mixed with a rather sleek and rich color palette, which is rather appropriate for any kind of auto lover.

Lastly, as many of us probably eagerly await the release of the new main attraction of the 2025 Honda Prelude model, I can hopefully recall the time my father and I spent together in that ’90s version of the car. As such, I hope the new Prelude will excite the next generation, similar to before, knit the bond between a parent and their child, and build a future where driving is safe, sustainable, and exciting for all.

Until then, I’ll let my mind wander with these thoughts of the new 2025 model, specifically the Honda Prelude.

2025 Honda Prelude – Photo Gallery

Honda’s investigation showed that the problem is that one or several steps in the assembly chain are out of order: both parts are melded together before one should have been fused to another part; this not only results in an incomplete connection but also a lack of a tight seal between these two parts. In response, the automaker put into practice improved assembly processes on October 18.

The automaker said it first learned of the possible issue on May 13, 2024, when it received the first warranty claim complaint. This was reported to Honda through a dealership which noticed the possible problem while conducting a pre-delivery inspection. A week later, Honda found six other vehicles with half-completed fuel pipe connections still on its lot as of May 20.

Based on further analysis over the subsequent months, Honda made the decision on November 21 to give a safety recall on this problem, despite having not received any reports of any deaths or injuries resulting from this problem.

Owners of about 200,000 affected vehicles will receive postcards from Honda, directing them to take their Pilot and Passport SUVs to an authorized dealer to check and fix the defect. Services technicians will carefully look at the connection, and they will calibrate the connection to be proper for the two parts to fit. Honda is hoping to start the notification process in early next year.

The 11^th generation Honda Civic was teased last November and now the final version is nearing production. The car is expected to rollout by the end of this year as a 2022 model. The sedan is one of the most popular in America and “the most popular vehicle, car or light-truck with millennials, Gen Z and first-time buyers.”

The vehicle does not have a game-changing design. It seems Honda has tried to play it safe, which might be a wise move considering how radical redesigns are received in the market. However, the Japanese auto manufacturer has promised the car will be thrilling to drive.

The new model has smaller wheels and a tamer paint colour. We have to wait and see what the 2022 Civic’s interior looks like. For now a teaser sketch should suffice. Honda states that the full specs and more photos will be shared on April 28th.

We expect the engine of this civic will be a 2.0 litre inline-four on the base model and a more powerful turbocharged 1.5 liter inline four as an option. A manual transmission might be offered but only in the performance variants such as the Si and Type R.  

The company says the Civic will go on sale this summer, with a hatchback version following several months later.

When it starts arriving at U.S. dealerships a few months from now, the civic will be priced higher than the previous model.

When it comes to the facelift, Honda has only changed the front fascia by removing all unnecessary bells and whistles. Instead, the front-end represents a more elegant and stylish look. The front-grille has been widened to blend in with the sleek headlights, while the fog light openings have been reduced in size to give the sedan a sense of practicality. Honda has also improved the LED lights to illuminate more of the front allowing the driver to see further down the road. The changes apply to both the low beam and the high-beam functions. Moreover, a new color has been added to the line-up called, ‘Sonic Grey Pearl’, which will only be available on selected trims.

Inside the cabin, the standard display has been upgraded to the 8.0-inch infotainment system that hosts both Apple CarPlay and Android Auto. If you opt for the EX-L and Touring variants Honda gives you wireless Apple CarPlay and Android Auto. What’s more, the rear passengers also get two USB ports along with the standard two ports in the front.

The Japanese auto giant has not changed the powertrain specifications for the 2021 Honda Accord, but it has improved the engine’s performance via an upgrade in the software. As a result, the engine will drive smoother and will become more efficient as it depends more on the hybrid system.

When it comes to safety, the Honda Accord gets a better lane-keeping assist, adaptive cruise control along with a rear-seat reminder, and a rear seatbelt reminder. The higher trims get an additional feature called the low-speed braking assist that will prevent any accidents while parking.

Video showing the interior of the All-New 2021 Honda Accord:

The 2021 Honda Accord has 10 different variants, each of which has several luxury features to choose from. The sedan starts at $24,770 with the range-topping trim priced at $36,240.