Japan-based Honda Motor is planning to introduce a small electric vehicle (EV) with a price tag below $30,000 in North America, potentially as early as 2026, reported Nikkei Asia.

This move is part of Honda's strategy to expand its presence in the battery-powered car market,

The Japanese automaker plans to manufacture this cost-effective model locally, reported the publication.

It is expected to be part of the "Honda 0 Series" EV lineup, which the company showcased through prototype models, the Honda 0 SUV and Honda 0 Saloon, at the Consumer Electronics Show in Las Vegas last month.

Production of these two models is scheduled to commence at American Honda Motor Company’s facility in Ohio.

The Honda 0 SUV is slated to be the first off the production line, with its North American launch scheduled for the first half of 2026, followed by a rollout in global markets.

Honda has been relatively slow in the race to dominate the EV market, falling behind US, European, and Chinese firms such as Tesla, Volkswagen, and BYD.

However, the company has set goal for battery-powered and fuel-cell vehicles to constitute 100% of its new car sales by 2040.

Earlier in the month, American Honda Motor Company projected a 6% increase in vehicle sales to 1.51 million units by 2025, following a 9% rise to approximately 1.42 million in 2024.

The company attributed last year's sales boost to an "easing of production constraints," which facilitated a consistent supply of products to dealerships.

The CRV mid-size SUV emerged as the top-selling model in the previous year, with 402,791 units sold, half of which were hybrid versions.