Honda's China sales have plunged from 1.62 million vehicles in 2020 to just 640,000 last year.
Despite that 60% decline, the Japanese automaker is not giving up on the world's largest auto market.
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It recently announced a 10-year extension of its joint venture partnership with Guangzhou Automobile Group (GAC) through 2038.
A Long-Term Bet on China
Honda and GAC have been building vehicles together in China since 1999.
To date, the joint venture has produced over 11 million cars.
Last year, the GAC joint venture contributed 340,000 units to Honda's total China sales, while the Dongfeng joint venture accounted for the rest.
In a statement to Nikkei Asia, a Honda spokesperson said the extension allows the company to assess the business environment as the market shifts rapidly.
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However, simply staying committed does not guarantee success.
Chinese buyers are increasingly choosing local brands that offer competitive pricing and advanced technology.
Honda launched its Ye series of EVs in China in 2024, including the P7 built with GAC and the S7 built with Dongfeng.
But these models have not been particularly desirable in the Chinese market.
No new GAC Honda models are planned for China this year.
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To turn things around, Honda will need to offer competitively priced vehicles with strong technology appeal.
