Japanese automaker Honda Motor plans to close at least one of its joint venture plants in China this year, as the company continues to adjust its capacity in line with demand, according to reports citing sources with knowledge of the company.

The reports suggest that Japan’s second-largest automaker plans to close an internal combustion engine (ICE) vehicle assembly plant in Guangzhou owned by GAC Honda Automobile Company, its joint venture with Chinese state-owned Guangzhou Automobile Group (GAC), as early as June 2026.

The sources also suggested that Honda ​is considering suspending ICE vehicle production at a plant owned by its Dongfeng Honda Automobile Company joint venture with state-owned Dongfeng Motor Group, based in Wuhan, this year. The company has a total of six vehicle assembly plants in operation in China, split between these two joint ventures.

Honda’s vehicle production in China fell by over 16% to 682,289 units last year, down from 816,597 in 2024, as the company struggled to keep up with the country’s rapid transition to new energy vehicles (NEVs). This compares with peak output of 1.57 million units in the country in 2019.

The company’s total production capacity in China is estimated at around 1.2 million units, which was reduced following previous restructuring. Honda said it had not released a statement regarding the plant closures and declined to comment on these latest reports.

Last month, the automaker announced that it was writing down the value of its Chinese auto business due to the production capacity cuts and falling sales. This followed the announcement earlier this year that it would incur a one-off global restructuring cost of US$ 15.7 billion, relating mostly to cutting back its US battery electric vehicle (BEV) programme.