Honda is set to reduce its engine production capacity at its plant in Guangzhou, China.
The company plans to consolidate its two existing production lines into one, reducing its annual engine assembly capacity from 520,000 units to 260,000 units. This accounts for approximately 30% of Honda’s gasoline engine sales in China.
Earlier this year, Honda halted operations at one of the three gasoline vehicle assembly plants run by its joint venture with Guangzhou Automobile Group (GAC).
Honda’s performance in the Chinese market has been challenging. In 2024, its vehicle sales in China dropped to 850,000 units, a 30% decline from the previous year.
Honda launched its first dedicated EV production facility in Wuhan, Hubei Province, last year to accelerate its transition to electric vehicles. The company has commenced operations at another EV-exclusive plant in Guangzhou, increasing its total annual EV production capacity to 240,000 units.
Honda’s strategic restructuring reflects its efforts to adapt to the rapidly shifting trends in the Chinese automotive market.
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