Honda to make organisational changes to improve competitiveness in rapidly changing auto landscape

Honda has announced it will make organisational and operational changes set to come into effect on April 1, 2026 as it attempts to sharpen its response to a rapidly evolving global automotive landscape. This comes after the automaker reported less than desirable results in the third quarter of its financial year ending March 31, 2026.

In 2020, Honda separated two key research and development functions – the development of production models and research on future technologies – as a way to enable each group to focus on its roles. According to the company, this decision was fruitful in terms of business and technological competitiveness.

However, with the global environment changing faster than expected, Honda says it is making revisions to be able to deliver. To this end, Honda R&D Co., the R&D subsidiary of Honda, will absorb the R&D functions of the Automobile Development Operations as well as SDV Business Development Unit, the latter currently parked under Automobile Operations.

With this change, Honda will have a structure where the entire process, from the selection of technology themes through product market launches, is one integrated flow to drive the entire process at speed, while flexibly responding to the changes in business environment.

Meanwhile, Automobile Operations will be reorganised to include the new Business Strategy Unit and Regional Business Unit starting April 1, 2026. The business functions currently served by the SDV Business Development Unit will be integrated into the new Business Strategy Unit, with the former business unit set to be disbanded.

Honda says this will help in terms of profitability, as it enhances its product planning and sales capabilities in light of market dynamics and customer needs, while also strengthening the competitiveness of its products from the mid- to long-term perspectives.

Moving away from Automobile Operations, Honda’s Motorcycle and Power Products Operations will also see some big changes. The most significant is merging the functions that were being handled separately for electric models and internal combustion engine models. This integrations covers sales, business strategy as well as product development to ensure more efficient resource allocation for the full chain of what gets built and sold.