Electric Zhijia News, on May 15, according to Nikkei Asia, interface and other media reports, due to the decline in sales, Honda is reducing its full-time production staff in China, Guangqi Honda has begun to solicit voluntary resignation among regular employees, and about 1,700 workers have agreed to leave, accounting for about 14% of its total production employees. In addition, Honda may also reduce the number of days of operation at its factories in June.
Jiemian News confirmed this matter to Guangqi Honda and received a positive reply: the solicitation has just been launched, and employees can independently propose it according to their wishes, and Guangqi Honda will compensate employees in accordance with laws and regulations, and the specific compensation plan has not yet been determined. The purpose of the plan is to accelerate the transformation of Guangqi Honda's new energy strategy, and the production will also be adjusted with the reduction of the production team, but the specific production plan adjustment has not yet been clarified.
Honda's choice to lay off workers at its joint venture in China is an example of how Japanese automakers are coping with fierce price competition in China, especially in a Chinese auto market where EV penetration has begun to break 50 percent. In terms of sales, since the sales reached a record high in 2020, Honda's sales in China have declined for three consecutive years, from 1,561,500 units in 2021 to 1,234,200 units in 2023, of which Guangqi Honda's sales have declined from 780,000 units to less than 650,000 units, and the annual decline continues to increase.
From January to April this year, Honda's sales in China were 280,700 units, down 10.9% year-on-year. Among them, Guangqi Honda's sales were 141,600 units, a year-on-year decrease of 19.01%. Honda expects sales in China to be 1.06 million vehicles in fiscal 2024, down 13% from the previous year and about 40% below the all-time high in fiscal 2020.
On April 16, Honda China officially unveiled its new pure electric brand "Ye". According to the plan, the "Ye" brand will launch 6 electric vehicles by 2027. At the same time, Honda China reaffirmed that it will achieve 100% electrification by 2035. At this press conference, Honda China brought a total of three new cars, namely Ye GT Concept, Ye S7 and Ye P7. The GT Concept is similar to a coupe and will be officially launched in 2025, while the other two models are positioned close to SUVs. Among them, the Ye GT is still a concept car, the P7 will be put into production by Guangqi Honda, and the S7 will be put into production by Dongfeng Honda and will be launched by the end of the year.