KALIMANTAN UTARA — Honda has issued a stark ultimatum to its suppliers: cut prices drastically, or risk being left behind. The Japanese automaker aims to save 1.5 trillion yen ($9.4 billion) by 2030 through a sweeping cost-reduction drive, according to internal documents and a person familiar with the matter.
The strategy was revealed as Honda managers briefed suppliers on the new targets, as reported by Reuters. The maker of the popular CR-V sport-utility vehicle is now demanding aggressive price concessions to weather what it calls a "panic-induced" cost crisis affecting every automaker outside China.
This pressure campaign reflects a broader industry shake-up. With Chinese EV manufacturers scaling rapidly, legacy automakers are being forced to find efficiencies at unprecedented speed. Honda's directive signals that suppliers will bear the brunt of this financial recalibration.
The cost-cutting push comes at a pivotal moment for the industry. August sales data and Tesla's latest Full Self-Driving push in the European Union add further complexity to an already volatile automotive landscape. Meanwhile, Chinese EV makers are expanding into Canadian markets, intensifying competitive pressure on established players.
