Honda CEO Takahiro Hachigo says there’s no future for EVs. Or maybe he didn’t. Comments Hachigo made recently indicate he doesn’t see “a dramatic increase in demand for battery vehicles.” Much of the confusion comes from analysis / commentary from other media outlets reacting to a recent interview with Automotive News Europe. Hachigo appears, at worst, to be honest in noting that demand sucks currently for fully electric vehicles. That honest appraisal disheartens EV-enthusiast journalists who dislike an executive who isn’t a full-on cheerleader for battery electric vehicles.
Tesla has shown there’s a market for pure EVs, not just hybrids, not just plug-in hybrids (PHEVs). Similarly, two decades ago, Toyota showed there’s a market for hybrids that went a mile or two on battery power, the rest of the time on gasoline (but still managed impressive mpg increases). Their dominant products sucked the oxygen out of the market for a decade or more.
What Honda CEO Hachiago Really Said
Here’s the key points from an interview of Hachigo with Automotive News Europe editors Jamie Butters and Hans Greimel, through a translator:
Q (ANE): Honda wants two-thirds of its global sales to come from electrified vehicles by 2030. What is your road to electrification when demand for hybrids and EVs is still undeveloped?
A (Hachiago ): I believe hybrid vehicles will play a critical role. The objective is not electrification, per se, but improving fuel efficiency. And we believe hybrid vehicles are the way to abide by different environmental regulations.
Q: What about full-electric vehicles?
A: Are there really customers who truly want them? I’m not so sure because there are lots of issues regarding infrastructure and hardware. I do not believe there will be a dramatic increase in demand for battery vehicles, and I believe this situation is true globally. There are different regulations in different countries, and we have to abide by them. So it’s a must to continue R&D. But I don’t believe it will become mainstream anytime soon.
What we hear from Honda’s head guy is what you’d expect to hear from pragmatic automaker: a straightforward appraisal of where the market is today. He did not, unlike other CEOs, complain that governments need to underwrite a big charging infrastructure first.
What we hear from some of our fellow editors tracking EVs is disbelief that Honda hasn’t gotten with the program. From Elektrek (“Honda CEO says ‘There Will Be No Dramatic Increase EV demand’”):
Honda EV Plus: first modern EV, 1997-99, 80-100 miles range, 300 built.
The automotive industry is operating on two completely separate alternative planes of existence. Readers of this site are familiar with the overwhelming evidence of EVs approaching an inflection point, and the last gasps of internal combustion. Let’s call that reality. And then there’s Honda’s Takahiro Hachigo, joined by executives from Toyota (and others). In their alternative universe, the inevitability of a pure-electric future is not proven. Nobody wants them.
… Nearly four decades ago, Honda introduced the first engine technology to meet US Clean Air Act standards without the need for a catalytic converter. In 1999, the Honda Insight was the first hybrid. But that’s ancient history. Today, the company remains fixated on 20-year-old technology rather than innovating for the new electric age. … At the same time, Hachigo’s latest statements are entirely out of step with the times. The imperative of global climate change is too urgent for minimal compliance and CES eye candy.
And from Jalopnik (“Ghostly Specter Of Honda’s CEO Still Not Convinced Electric Cars Are A Thing”):
Here comes Honda CEO Takahiro Hachigo, rising from the dead to walk among us in the year 2019—a year in which Tesla has sold more than 255,000 cars [worldwide]—to inform us he is still not sure about this whole electric car thing, revealing himself to be not a man but a ghost of a bygone era.
Honda is also designing a modular electric car platform which they hope to have ready by 2025. Does that count as “anytime soon?” By automaker timelines, probably not, which means there’s plenty of time for more CEOs to die and rise from the dead before Honda completes its EV platform for a future it doesn’t think will happen.
One company dominated hybrid sales 20 years ago: Toyota. Now Tesla is doing the same with EVs. Four-fifths of EVs sold in the US are Teslas. After that, only Chevy, Nissan and BMW sell more than 5,000 EVs year. (Source: Statista)
The EV Market Is Good (For Tesla)
Automakers have lots of rules to follow: crash protection, safety equipment, emissions. Also they have to make money for shareholders. And stay in business. Right now, Tesla dominates battery-electric vehicle sales, controlling 80 percent (182,000) of the 228,000 pure EVs sold in 2018 in the US, which is 1.0 percent of all US sales. What’s left is table scraps. Chevy has 8 percent of the EV market (0.1 perecent of all vehicles sold), Nissan 6 percent of EVs (0.1 percent of all sales). For everybody else, it rounds to 0.0 percent unless you go to two decimal places.
Honda sold 948 Clarity BEVs in 2018. That is a small number: one of every 1,500 Hondas sold, one of every 18,000 cars sold (all brands) in 2018. Clarify is actually three vehicles: a fuel-cell car that converts hydrogen to electricity, a BEV (the sub-1,000 sales), and a plug-in hybrid. Together they accounted for 20,000 Clarity sales, but virtually all of them were PHEVs. Honda marketed the Clarity BEV as a comfortable family car (think Accord with batteries instead of gasoline). But with an EPA combined-driving range of 89 miles, it was a challenging car to sell. Honda will move into 2020 with the fuel cell and PHEV but not the Clarity EV.
Critics scoff at PHEVs as uninteresting for the long term, and they’re probably right. For. The. Long. Term. But in the US with its greater driving distances than Europe, they make sense. You can drive to and from work on electricity alone if you remember to recharge when you get home. And then on weekends you go where you want, mostly on gasoline. Meanwhile, battery technology is improving at about 20 percent a year, so four to five years from now, a 100-mile Clarity BEV could be a 200-mile Clarity. (And, okay, a 250-mile Tesla could be a 500-mile Tesla.) So Honda could lay low until 2025, rejoin the fray then, and not miss a lot of EV sales in the US. In Europe, the company may face regulatory pressure to act sooner.
The Honda E is part of a new architecture coming within five years.
Honda’s Roadmap for Electrification
Honda e, due in 2021 in Europe – Honda’s first minicar since 2001.
Honda will bring to bring to market an electric city car in 2020 called the Honda E, in the spring of 2020. At 157 inches, it’s smallish for the US market. Over the summer Honda told investors and media it’s developing a dedicated EV platform for midsize and large sedans and SUVs. The first vehicles will come to market in 2025. It’s this timeframe that has some media critics upset with Honda.
Right now in the US Honda has these alternative vehicles:
- Honda Accord Hybrid, 48 mpg city / 46 mpg highway, this from what measures as a full-size car.
- Honda Insight third-generation compact hybrid, 48 mpg city / 46 mpg highway
- Honda Clarity PHEV, BEV, hydrogen fuel cell through 2019.
- Honda CR-V Hybrid, due early 2020, targeting Toyota RAV4.
Honda appears to be intercepting the glidepath toward higher-efficiency, zero-tailpipe-pollution vehicles. Europe especially is pushing automakers toward cleaner, higher-efficiency vehicles. Honda will begin selling the retro-look Honda e next year in Europe, with a goal of at least 10,000 units a year, possibly more. The Honda e, a minicar, will allow Honda to meet EU CO2 targets in 2020 and 2021 without paying fines.
While we live on the same planet and breathe the same air (more or less), Europe feels the shock more when Russian or the Middle East countries restrict access to petroleum – the US can always “drill, baby, drill” (per Sarah Palin – and Europe is also more concerned about clean air. The US’ concern about fuel consumption and clean air depends a lot on who’s in the White House come 2021. Currently the US supports aggressive petroleum-source development and extraction.
Now Read:
- 2018 Honda Clarity Review: This Midsize Plug-In Hybrid Could Be Your Only Car
- 2018 Honda Accord Review: Way Better, and Honda Even Fixed Display Audio
- 2019 Honda Insight Review: A Better-Looking, 50 MPG Civic
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