Honda CEO Says “Can’t Force Customers To Shift From Petrol/Diesel To EVs” – Here’s Why
A majority of automakers in the last few years have been pushing the electric vehicle agenda. This was mainly due to pressure from various governments and other stakeholders. However, in recent months, most automakers have cut back on their EV plans and are now shifting their focus to hybrids and ICE vehicles. Recently, Honda’s CEO, Toshihiro Mibe, made an important statement, emphasizing that the transition from internal combustion engine (ICE) vehicles to electric vehicles (EVs) cannot be forced upon customers.
Honda CEO’s Statement
Recently, at the Monterey Car Week, Honda’s CEO stated, “You can’t force the customer to change their mind, really, and to some degree [you can incentivize] them, but we just can’t force the people living in, say, the Midwest, with no charging stations.”
He also added, “Even with incentives, they will not change from ICE to BEV. I believe it will be very difficult to force people to go for it. We need to prepare the ecosystem gradually and let them migrate little by little.”
Mibe continued, “We’re closely monitoring the number of [new] charging guns per electric vehicle, so it’s not a very rapid growth, but gradually and steadily, it is increasing.”
What Does This Mean?
From the statements of Honda’s CEO, it can be understood that automakers are acknowledging that the current infrastructure for EVs is not up to the mark. This means that even if the government or automakers force buyers to shift to BEVs, it will not be effective.
It can also be noted that the Honda CEO acknowledges that the transition to EVs will only happen when the issues related to EVs are first resolved. These issues include charging infrastructure, range anxiety, high upfront costs, and other concerns. He also highlighted that merely incentivizing car buyers to purchase EVs is not the solution.
Automakers Are Shifting Their Focus
As EV sales are currently on a downtrend, many automakers, including Honda, are now shifting their focus toward hybrid technology. Hybrids, which combine traditional ICE engines with electric motors, are increasingly being seen as a more practical solution in the transition toward full electrification.
Many experts believe that hybrids offer the benefits of electric driving, such as reduced emissions and fuel savings, without the downsides associated with pure EVs, like limited range and the need for extensive charging infrastructure.
Mibe also explained Honda’s strategy, stating, “We believe in a multi-pathway approach. Hybrids, hydrogen fuel cells, and EVs will all play a role in the future of mobility. Each market has different needs, and we must be flexible in our approach.”
Ford and Other Carmakers Are Also Cutting Back on EV Plans
Other major automakers, like Ford Motor Company and Mercedes-Benz, have also recently announced their decision to scale back their EV investments and focus more on hybrids. The American giant cited high costs, supply chain challenges, and uncertain consumer demand as key reasons for this strategic shift.
In a similar fashion, Mercedes-Benz and Cadillac have also slowed down their EV rollouts. They have expressed concerns over battery technology, charging infrastructure, and the readiness of consumers to embrace fully electric vehicles.
Global Scale Back from EVs
In Europe and China, stringent regulations and generous incentives are driving the push towards electrification. However, in other regions, including the United States and India, there is a growing recognition that a one-size-fits-all approach may not be feasible. The varying levels of infrastructure development, buyer readiness, and economic conditions mean that hybrids and ICE vehicles still have a significant role to play.
EV Sales Are Falling
Recent sales data has highlighted that EV sales are falling across the globe. BEV sales have decreased from 8.1% of the total light-duty vehicle (LDV) market in the fourth quarter of 2023 to 7.0% in the first quarter of 2024.
Despite the introduction of new models and increased governmental support, many buyers are still reluctant to make the switch. This trend is not confined to the U.S.; in China, the world’s largest EV market, growth has also slowed down after years of rapid expansion.
Europe, which had seen a significant uptick in EV sales due to stringent emission regulations, is now witnessing a slowdown. India, too, is experiencing a similar trend. Tata Motors, the country’s largest electric carmaker, has reported a significant slowdown in its EV sales over the past few months.
Despite launching new models like the Nexon EV and the Tiago EV, Tata Motors in June 2024 reported a 15% decrease in EV sales compared to the same period last year. This was the fourth consecutive month of declining sales.
In July 2024, the company sold 2,300 units, down from 2,700 units in June and 3,100 units in May. April saw the sharpest decline, with only 1,900 units sold compared to 4,500 in March.