Tag: Honda

From Watts Up With That?

By Gary Abernathy

This article was originally published at The Empowerment Alliance and is re-published here with permission. 

The importance of codifying into law the guarantee of affordable, reliable energy for all Americans is driven home by the current turmoil surrounding Honda, which “reported its first annual loss since becoming a publicly traded company in Japan seven decades ago,” as reported by the New York Times back in May.

Why did a company considered one of the most stable in the world suddenly suffer such a catastrophic about-face? In large part because it relied on Biden administration policies designed to funnel industries into a future where fossil fuels would be completely phased out.

Honda decided to gamble its prospects on the Biden era fantasy, but when Donald Trump took office in January 2025, the new administration quickly changed course, canceling policies that were based on climate change hysteria and resetting the economic course of the U.S. and, by natural progression, much of the world.

As described in a follow-up Times story last month, just five years ago, Toshihiro Mibe, Honda’s chief executive, “pledged that by 2040, the Japanese automaker — long celebrated for its mastery of internal-combustion engines — would spend tens of billions of dollars to phase them out in favor of electric vehicles.”

But consumer demand for EVs began to wane – not because of free market factors, but because consumers had been manipulated by government policies that either limited their choices or penalized them for going against the government grain. Putting all its eggs into the EV basket, Honda was caught flat-footed when government policies changed.

“Honda’s troubles reflect a broader reckoning across the automotive industry,” according to the Times. “In some ways, the company has become a poster child for legacy carmakers, from Volkswagen to Ford Motor, that wagered billions on a rapid shift to an electric future, only to be caught flat-footed when consumer demand cooled.”

Again, let’s say this slowly so everyone can follow: Consumer demand didn’t cool because fickle buyers couldn’t make up their minds between internal combustion engines and EVs. Deep into its story, the Times finally acknowledges the real reason for the briefly growing popularity of EVs in the first place: “The Biden administration added momentum by offering billions in subsidies and consumer tax credits.”

There we go. More than anything, the promise of billions in government subsidies convinced many consumers, automakers and other industries to go full-steam-ahead into a future where fossil fuels would be a distant memory.

Then what happened?

“In the United States, Honda’s largest automobile market, the Trump administration’s elimination of federal tax credits for electric vehicles has sapped demand, contributing to the automaker’s first annual net loss in its seven-decade history as a public company. It has since abandoned its goal of going all-electric by 2040,” according to the Times, finally nailing the determining factor of Honda’s fall – government policies that can fluctuate wildly from one administration to another.

Offering a real chance to bring certainty and confidence to the energy market – and avoid the kinds of wild industry swings that happened to Honda and others – is the Affordable, Reliable, Clean Energy Security Act (ARC-ES) introduced last year by Rep. Troy Balderson (R-Ohio). ARC-ES would guarantee that our most effective, affordable and reliable energy sources, such as natural gas, would always remain an important part of the U.S. energy mix – a certainty that would provide a steadying ballast for corporate decision-makers.

Despite seeing its influence wane at the federal level, the radical left climate movement has hardly given up. As noted here before, after reading the tea leaves from the Trump administration, the left has taken its battle to the states. Fortunately, the believers in affordable and traditional energy are also working at the state level, with Louisiana becoming the first state to codify ARC-ES into law, and other states considering similar legislation. As Louisiana Gov. Jeff Landry said, state policy will be “to ensure our electricity is affordable, reliable, and clean energy security for our state.”

While battles are being waged at both the state and federal levels, what needs to be remembered is that the government policy has real and lasting consequences. And as the Democratic Party is rapidly being coopted by socialists in primary after primary, average Americans have more reason than ever to fear that government will – someday soon – mandate which energy resources are
acceptable, and which are not.

As we see with the case of Honda, private companies that plan their futures based on subsidies and mandates can face disaster when those policies – whether for or against – are suddenly reversed.

That’s why it’s crucial to bring stability to the political landscape – stability that can only be effective when all energy resources are allowed to be part of the mix, rising or falling on merit, not politics.

While embedding the principles of ARC-ES into agency rulemaking would be a good start, codifying them into law at both the state and federal levels while Congress, the White House and most states are under Republican control would make energy security much more reliable for industry planners.

While American industry deserves assurances that their long-term planning can confidently include affordable, reliable energy sources without those choices being mandated away by the next set of climate fanatics who might find themselves in office, consumers are at more risk than anyone of having their lives upended by the whims of radical left government policy. Let’s remove that risk and codify the guarantee of energy security for every American.

Gary Abernathy is a longtime newspaper editor, reporter and columnist. He was a contributing columnist for the Washington Post from 2017-2023 and a frequent guest analyst across numerous media platforms. He is a contributing opinion columnist for The Empowerment Alliance, which advocates for realistic approaches to energy consumption and environmental conservation.

This article was originally published by RealClearEnergy and made available via RealClearWire.