A behind-the-scenes power struggle at Honda Motor has surfaced after retired senior executives attempted and failed to remove Chief Executive Toshihiro Mibe over mounting concerns about the company’s strategy in China and its electric vehicle (EV) direction, according to reporting by Reuters. The dispute highlights deepening tensions within one of Japan’s most prominent automakers as it grapples with structural challenges in a rapidly shifting global auto industry.
According to Reuters, a group of former Honda executives began holding private discussions late last year to assess the company’s performance and identify what they believed were strategic failures under Mibe’s leadership. These conversations, which reportedly included meetings, messages, and occasional interactions with current executives, focused on what participants described as missteps in China and a costly EV strategy.
The former executives accused Mibe of neglecting China, the world’s largest automotive market, and pursuing an electric vehicle strategy that they said had contributed to significant financial losses. Reuters reported that critics within the group also alleged that the CEO placed excessive attention on corporate activities such as sponsorships, rather than core business operations. By April, former Honda chief executive Nobuhiko Kawamoto reportedly confronted Mibe directly in Tokyo and urged him to resign, although Mibe refused to step down.
Despite the internal pressure, Honda’s board has continued to back Mibe, Reuters reported. The CEO, who assumed his position in 2021, remains in office even as the company faces financial strain linked to its EV investments and broader market challenges. The situation underscores the declining influence of corporate alumni in Japan, where increasing corporate governance reforms have strengthened the role of independent directors.
Honda’s challenges are compounded by external pressures in the global automotive sector. Reuters reported that Japanese automakers remain heavily dependent on the United States market, where profitability has been squeezed by tariffs and reduced electric vehicle subsidies. At the same time, domestic demand for EVs in Japan remains limited, leaving manufacturers caught between legacy combustion-engine businesses and costly transitions toward electrification.
The company has also faced increasing competition from Chinese automakers, which have rapidly expanded their presence in the EV market with lower-cost, software-driven vehicles. Reuters noted that this shift has intensified pressure on traditional manufacturers such as Honda, which have long relied on precision engineering and slower, more methodical development cycles.
In response to its financial challenges, Honda recently scaled back parts of its EV strategy, including reversing its earlier commitment to go fully electric by 2040 and writing down significant EV-related costs. Reuters reported that these adjustments followed the cancellation of multiple EV development projects, contributing to losses estimated in the billions of dollars.
Within Honda, Reuters also highlighted internal tensions between business divisions, particularly between the motorcycle segment, which remains highly profitable, and the automotive division, which has been under financial pressure. Some employees reportedly believe that profits from motorcycles have effectively subsidized the struggling car business, adding to internal friction.
The leadership dispute also reflects broader changes in Japanese corporate governance. Reuters reported that independent directors now play a greater role in decision-making, reducing the influence of retired executives who once held significant informal power within companies like Honda. In this case, the board’s nominating committee—composed largely of outside directors—supported Mibe’s continuation in office despite calls for his removal.
Honda has stated, in response to Reuters inquiries, that it was not aware of discussions held by former executives and emphasized that its strategy focuses on cost control, supplier coordination, and ongoing technological development. The company also defended its branding and sponsorship activities as part of its corporate strategy.
As Honda attempts to stabilize its EV transition and regain momentum in key markets such as China, Reuters reported that Mibe has introduced cost-reduction measures and internal restructuring efforts. However, analysts and industry observers cited in the report suggest that the company remains at a critical juncture, facing intense pressure from global competition, internal divisions, and the high cost of transforming its core business model.
