Honda posted its first-ever loss. Here's what happened.

Honda (HMC) stock is in focus after the company posted its first-ever loss. Yahoo Finance Senior Autos Reporter Pras Subramanian breaks down the details.

Alright, Pras, so Honda posts its first ever loss, right? Okay, but the stock pops. What's the story here?

Yeah, I mean, look, they're they're going to book a $10 billion loss on all the EV stuff that related charges, you know, not just it's cars, it's the parts, it's the suppliers, it's the factories, it's all this stuff they're not going to be doing. Um, but shares are popping here. I'm getting my uh this warning here to update my software as I'm as I'm reading my notes here.

Don't do it. Don't do it. take half an hour.

I'm not doing it, I'm not doing it. Every time, worst time. Um shares are popping, guidance better than expected, right? So they lost 2.6 billion US dollars this year. It's seeing a 3.2 billion dollar gain outbring profit next year for fiscal year 2027. They have fiscal your uh situation there. So that's good for them, right? Um they're out with the EVs. So what's, you know, what's coming in? A bunch of hybrids, um new sedans and SUVs. So there's some enthusiasm there. But you know, we're talking offline about Honda, you know, they really need something to kind of jazz up the brand. You got Toyota, you got Nissan, you got Honda, right? Toyota's got its own thing going on. quality. They got some sports cars. They got some they got some oomph going on there.

Nissan always had a had an enthusiast edge with sports cars and and things like the X which is kind of come back. Honda needs to get that back. They have reliability, they have great brand names like Accord, CRV, Passport, Pilot, but they need to get some oomph back in there.

Let me ask, when you look at that report, what, if anything, my friend, did that suggest to you about just where the consumer is at, what they're looking for in their next vehicle?

I mean, if you look at what Honda's saying, 15 new uh hybrids by I believe 2030 or so. Um makes you think, oh, consumers want hybrids. They want the the flexibility of of of the of of of cheaper, uh more efficiency, more range, but they don't want to get rid of gas. Okay, so Honda is saying, we we hear the consumer loud and clear. We're going to do that. Uh so I guess that's what they're saying. Uh again, um these cars tend to be not the most exciting cars, right? So, you kind of got to fit that power train in the right body, the right the right sort of uh uh form factor. And I think what Americans are saying is like, yeah, we want our crossovers and SUVs, but I think there's an opening there for more uh uh sexier cars. So so they today they showed two cars in Japan. They showed a uh um an Acura SUV. looks pretty standard. But then they showed a Honda as a sedan that looked really interesting. kind of a departure from what they're normally doing, very conservative styling. So I think Honda's listening a bit there. We're going to do mix of power trains, and then we're going to do interesting designs. So we'll see.

When you look broadly just across the auto sector right now, like who looks smart? Who had the right strategy? Was it was it the folks who went like pure EV, right? Was it the folks who said, we'll keep a foot in hybrid? Like who looks smart to you?

you know, you got to look at in terms of people who aren't looking too smart, you got to see, you got to look at Stelantis and Ford, even GM too, they went really they pushed forward in that EVs and they're paying the price. uh to of billions of dollars. We saw Honda here. But you know, I I got to bring up Toyota again because they didn't actually go too far into EVs. They were always number one in hybrids and they stuck with that. They said, hey, you know what? We're not sure that Americans and people uh especially in western countries want to buy this many EVs. And then and then secondly, they thought for the amount of battery it takes to make one EV, we can make 100 hybrids. They did that and that's working out well, well, but they're now Toyota's investing in five new EVs to the US market. What are they thinking? Are they are they saying that the time is starting to happen now? Uh are they are they are they making a mistake? Uh what what's their game plan there? I think they're they're thinking that they're going to catch that wave before it actually kind of crests. And with regards to the fact that high high gas prices are here to stay for a while, maybe they caught that just right. So I would say Toyota's smart here, um but you never know. This is like this industry is so wild with people trying to think they know what they what's going to happen. Talk look at Jim Farley two, three years ago, he looked like a genius. Um and now he's sort of rejiggering everything.

Uh, speak of Jim Farley tomorrow. I think we're talking Bronco. I believe, I believe. He's not tomorrow's show.

Look,

Yeah. Deep tease. Deep tease.

Deep tease. Deep tease.

Thank you, Pras. Appreciate it.