We’ve all been focusing on America and how tough it is to maneuver its car market. Do they want big luxury SUVs? Small, cheap Chinese cars? But that’s distracted us from other markets around the world. Apparently, Honda is leaving Korea’s market after 23 years.
At a press conference, Honda Korea — the Korean sales unit of Japanese automaker Honda Motor — said it will cease all vehicle sales in Korea by the end of this year. Said Head of Honda Korea Lee Ji-hong: “We have carefully reviewed our business direction in light of changing market conditions and exchange rate fluctuations.”
Honda won’t be leaving Korea entirely. It will focus on the motorcycle side of things, making more competitive products, and providing customer service to existing vehicle customers. No layoffs or reorganizations have been announced yet. Honda has been in Korea since 2001, launching vehicle sales in 2003. While the motorcycle market has been going well, the vehicle side hasn’t been reaching expectations. As of March 2026, Korea has sold 108,600 cars in Korea. This is despite a wide range of attempts at innovation, like offering online vehicle sales.
“It is regrettable to end business [in Korea], but we will faithfully respond to the consumers so they do not feel uneasy,” said Ji-hong.
Is Honda in deeper trouble than we think?
Honda’s seemingly sudden departure from Korea follows years of declining sales. Exchange rates, import fees, and currency conditions were the main factors behind the carmaker’s decision to leave Korea, according to the carmaker. However, a lack of options was another glaring issue: Honda only sold the Accord, CR-V, Odyssey, and Pilot in Korea. While these vehicles are staples, they are not anything too exciting. It also canceled the development of its upcoming EVs, further limiting its lineup to pretty dull vehicles that don’t really push boundaries.
But is this really a sign that Honda is in trouble? Some believe so, noting that Honda’s lack of EV plans indicates the automaker is falling behind. It can’t keep up with China’s cheap EVs and hasn’t figured out a way to thrive in that segment or pivot to another. While floundering in the U.S. market is a given for most automakers right now, it seems Honda is struggling in other countries as well. In China, Honda’s vehicles sales have been dropping for five years in a row now — falling 24% in 2025. The automaker started closing plants, unable to keep up. Now, it’s struggling to figure out Korea.
However, Honda isn’t alone. Nissan left Korea in 2020. Toyota is the only big Japanese brand left. It may not really be a Honda problem.
“There’s now not much reason to choose Japanese cars, when local carmakers have improved technologically, and there are more choices in the market,” Kim Ki-chan, an emeritus professor at Catholic University, said. “Japanese carmakers were not able to divert from their analog-based production system, and they were unable to adapt to the change.”
Honda is not the only major automaker that’s struggling to find its place in the car market now that EVs are taking over. Its technology is a bit behind, especially in batteries and software development. I think it’s too early to claim Honda is on its way out, but it will need to figure out a way to grow sales outside the EV segment or create a standout EV that it won’t eventually cancel.
