Honda's Large Electric SUV Cancelled after Billions Cut Out of Electric Car Development

Jul 13, 2025 6:00 AM

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Honda has reduced their electric vehicle development funding by 3 Trillion Yen (approximately $31.4 Billion AUD) and has all but cancelled plans for a large electric SUV.

This decision comes amid the backdrop of slowing EV sales and the signing into law of the Big, Beautiful Bill in the United States which sees the $7,500 in federal tax credits that came with new EVs fall by the wayside.

Immediately finding itself on the chopping block as a result of this is Honda’s large, seven-seat electric SUV that was set to arrive in 2027 as part of the new 0 Series range. It appears now that those plans have been halted.

The new 0 Series also includes a sedan and a mid-size SUV, set to arrive first in North America in the first half of 2026 followed by Europe and Japan, however, no plans have been confirmed to bring the 0 Series range to Australia.

With funding for EVs scaled back, the Japanese marque is instead pivoting toward hybrid vehicles, with 13 new hybrid models reportedly launching between 2027 and 2030.

Honda’s move away from electric vehicle development to focus on hybrids reflects an industry shift occurring among legacy car manufacturers, with brands like Ford, Mercedes, Porsche, Audi, Lotus and Volvo all among the brands that have scaled back their EV plans.

Honda sell five hybrid models in Australia in 2025

Honda currently offers Five hybrid models in Australia, including the Accord and variants of the Civic, HR-V, ZR-V and CR-V.

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FAQ

Has Honda cut its EV spending?

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Honda have cut the equivalent of around $31 Billion AUD out of its EV development.

Why has Honda cut its EV spending?

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Honda has likely cut its EV spending due to slowing EV sales and the implications of the Big Beautiful Bill in the United States which will see the end of tax breaks for electric vehicles.

Have any cars been cancelled by Honda because of the spending cut?

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Honda have reportedly halted plans for a large electric SUV because of the spending cuts.

What are Honda going to do now that they have cut EV spending?

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Honda are instead going to be focusing on hybrid vehicle development.

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Jack MacKenzie

Jack MacKenzie first wrote about cars at the age of 11 as “The Car Buyer of the Future” for Best Selling Cars Blog, having already spent the previous year creating car videos of his own. This set him off down the road to becoming an automotive journalist, joining CarSauce as a university graduate 11 years later. Jack made a name for himself in the world of motorsport, both real and virtual. He published videos on YouTube with a heavy focus on sports car and endurance racing, and has previously written for The Checkered Flag, Coach Dave Academy, Sim Grid and SimStaff. Jack’s daily driver is a 916 Alfa Romeo Spider, and on the weekends, he races go-karts in endurance races across his home state of New South Wales.