GAC Honda is shifting development leadership to local teams in China, a move that underscores how severe its sales slump has become.
The joint venture aims to cut development costs in half by letting Chinese teams decide what future models should be.
New Strategy for China
GAC Honda plans to boost local production efficiency by 20 percent and establish more than 1,000 new sales outlets.
Sales of its models have dropped 53 percent this year to around 80,000 units through July.
Honda and GAC recently confirmed their joint venture will run through 2038, with a plan to speed up EV development.
Over the next two years, they will jointly develop two electric models for China and two new hybrids, adding four electrified vehicles.
GAC vice president Lin Zhibin said the companies will better integrate supply chain resources to halve costs and cut development time.
Local teams, not Japan, will lead model creation, focusing on connectivity features developed in China.
GAC Honda will also work more closely with GAC dealerships and service networks.
Last year, GAC Honda sold 352,000 vehicles, down from a 2020 peak of 807,000.
Details on next-generation models are limited, but the electric P7, unveiled in 2024, has yet to succeed.
