Honda will leverage EV hardware in a new all-wheel drive system for future hybrids, while also targeting two million annual EV sales by the end of the decade, according to a Thursday business update from the automaker.
The all-wheel drive system for hybrids will use an electric motor developed for EVs to power one axle, eliminating the mechanical connection between the internal-combustion engine and that axle. It sounds similar to what Toyota does in most of its current all-wheel drive hybrids, which use an electric motor to power the rear axle exclusively, and will be used in conjunction with an updated version of Honda’s two-motor hybrid system.
Honda is already targeting 50% hybrids, as part of a plan to make hybrid versions of all its core models rather than hybrid-specific models. Under this strategy, for example, the Honda Insight will be replaced by a Civic Hybrid. It appears to be working well so far; we found the current CR-V Hybrid to be the brand’s best gas-fueled SUV.
A timeline for the AWD hybrids wasn’t given, but it appears to fit in Honda’s efforts to improve the business structure of its hybrids for 2026 to 2030. The current CR-V Hybrid does offer AWD, but it’s a mechanical system that relies on the motor system in front for rear wheel torque.
Honda preparing EV hub in Ohio
On the EV front, Honda is investing 10 trillion yen (about $65 billion at current exchange rates) over 10 years to ramp up production. It claims to already have a “positive outlook” for securing enough batteries for annual production rates of two million EVs by 2030, and expects to reduce the cost of batteries sourced in North America by 20% in that timeframe. It’s also targeting a 35% reduction in overall production costs.
Indeed, Honda’s planned expansion at two plants in Ohio, with more to come, plus recent delays and slowdowns in plans from other automakers, indicates that at face value, it might outpace all but Tesla. In 2025, Honda expects a U.S. joint-venture battery plant with LG to start production at an annual capacity of 40 gigawatt-hours.
Much of this infrastructure will support production of next-generation Honda EVs dubbed the 0 Series. Honda plans to launch seven models in this series by 2030, with technical improvements like lighter body shells and powertrain components, the latter developed with lessons learned from Formula 1 racing and the automaker’s hybrid models. That will reduce weight by approximately 220 pounds over previous Honda EVs, the automaker claims.
Honda 0 Saloon concept
Most of Honda’s future EV innovations were mentioned to Green Car Reports as we talked through the elements of the platform in its two 0 Series concepts revealed in January. But in this latest announcement, Honda also mentioned “posture control technology” derived from its robotics work.
What this presentation is missing is the potential of an affordable Honda EV for the U.S. That’s something Honda CEO Toshihiro Mibe told Green Car Reports and others in January might only be possible with battery innovations.
