Honda, a leading engine manufacturer, is facing challenges in the EV era.

Honda produces the most engines globally, which are used in approximately 27 million vehicles, tools, and other products, with the majority being internal combustion engines.

The company is a renowned supplier of engines to successful Formula 1 teams, a popular car manufacturer in the U.S. and worldwide, and the creator of iconic sports cars such as the Type R range of high-performance Acura and NSX supercar.

Despite facing challenges in certain regions, particularly China, and being impacted by the rise of electric vehicles, Honda has been slow in releasing new models and has relied heavily on partnerships to maintain its position.

The company, once known for its innovative engine designs, now faces criticism for its lack of creativity and predictability.

The company produced both affordable cars, like the Civic, and high-performance vehicles, such as the NSX, which challenged the established manufacturers in the luxury car market, mainly European brands like Ferrari, Lamborghini, Porsche, and McLaren. The NSX was not only lighter than its competitors but also equally powerful, enjoyable to drive, and cost less, according to Karl Brauer, an executive analyst at iSeeCars.

"For decades, they had not been challenged like that, but then suddenly, they had to reevaluate their production process for a capable sports car due to the NSX's impact," he stated.

The NSX was representative of what Honda was capable of at that time.

"Jake Fisher, senior director of auto testing for Consumer Reports, stated that no one else could match the quality of Honda's vehicles. However, the issue with Honda is that their manual transmissions, which were once smooth and enjoyable to drive, are no longer popular among buyers. Additionally, their high-revving engines, which were previously reliable, are now experiencing powertrain issues."

This is where Honda has moved from leader to laggard.

Honda's first two new EVs for the U.S. market, the Honda Prologue and the Acura ZDX, are built using the Detroit automaker's EV platform.

Honda has an in-house EV plan and its own platform. The company is investing $65 billion globally in EVs and software, including $11 billion in Canada and $3.5 billion for facility upgrades in the United States.

In 2023, the company was the second-best-selling brand of hybrids in the United States, surpassed only by Toyota.

Boosting Honda's sales in the short term may be possible, but it's uncertain how long it will last.

"According to Gregory Noble, a professor emeritus at the University of Tokyo's Institute of Social Science, who specializes in the Asian and global auto markets, the world is rapidly moving towards battery-electric vehicles. However, it is uncertain if they can keep up with this shift."