Semiconductor shortages force Honda to halt China production year-end, report says
Honda Motor plans to temporarily suspend vehicle production at its GAC Honda joint-venture factories in China from late December, a move notable given China’s core sales market and substantial production base for the company. The stoppage shows that supply chain disruptions continue to affect manufacturing schedules despite earlier expectations of normalisation.
According to a report citing InvestingLive, all three GAC Honda joint-venture plants in China will fully halt vehicle production from December 29 to January 2. The suspension applies to complete vehicle manufacturing operations at these facilities during the five days.
Honda stated that the primary reason for the production halt in China is the ongoing semiconductor shortage. The company acknowledged that chip supply conditions had previously shown signs of improvement, but the latest shutdown indicates that semiconductor availability remains insufficient to support uninterrupted production.
In 2024, Honda produced approximately 816,597 vehicles in China, representing about 22 percent of its global output. The company also sold over 850,000 vehicles in China that year, underscoring the country’s significance as both a major production hub and a core sales market for Honda.
The temporary suspension represents a setback relative to Honda’s earlier guidance. The automaker had previously said that production conditions were expected to return to normal starting in late November. The newly announced stoppage indicates that supply chain challenges remain unresolved, complicating efforts to restore stable output levels.
Investor reaction reflected these concerns. On the day the report was published, Honda’s share price fell by approximately 1.5 percent on the Tokyo stock exchange. The decline reflected market concerns that persistent supply constraints, combined with weak demand, could weigh on the company’s earnings performance in the period ahead.
In addition to the China shutdowns, Honda also plans brief production pauses at its domestic facilities in Japan. The company said that its Japanese plants will suspend production on January 5 and January 6. These pauses place the China stoppage within a broader pattern of supply-related production adjustments.
The reported production suspensions highlight the continued impact of semiconductor shortages on Honda’s manufacturing operations. Despite earlier signs of improvement, the company’s latest scheduling changes indicate that chip-related bottlenecks continue to influence production planning in China and other markets.
