Honda and GAC Group Extend Joint Venture Through 2038

On July 20, 2026, Honda Motor Co. and Guangzhou Automobile Group Co., Ltd. (GAC Group) agreed to extend their joint venture partnership, GAC Honda, until 2038. The agreement maintains the existing ownership structure while focusing on rebuilding competitiveness in the Chinese market by accelerating the transition to new energy vehicles.

Established in 1998 and based in Guangzhou, GAC Honda has sold over 11 million vehicles since production began in 1999. Despite this history, the venture has struggled with China's rapid shift toward electrification and intelligent vehicle technologies. Sales dropped 53% to 64,150 units in the first half of 2026, trailing domestic Chinese manufacturers.

As part of a broader restructuring, Honda may cease internal combustion engine vehicle production at GAC Honda to prioritize battery electric vehicles for both local and overseas markets. The company intends to leverage the combined technologies and resources of both partners to offer products tailored to diverse customer needs in the world's largest automobile market.