Honda Motor Co., Ltd. HMC has decided to wind down its automobile sales operations in South Korea by the end of the year as part of efforts to streamline its business structure and sustain mid- and long-term competitiveness.
The company entered the market with motorcycles in 2001 and expanded into car sales in 2004. As of March 2026, it had sold around 108,600 cars and about 420,600 motorcycles in the country. Honda had been offering models like the Accord and CR-V in the market.
However, South Korea remains a relatively small and challenging market, dominated by domestic players like Hyundai Motor Company and Kia Corporation, while competition from Chinese brands has intensified. Honda’s car sales fell to just under 2,000 units last year, marking a decline of more than 20% year over year.
Despite exiting car sales, Honda will continue providing after-sales support, including maintenance, parts and warranty services. The company plans to work closely with dealers to ensure a smooth transition and maintain service stability. Honda will now prioritize its motorcycle business in South Korea, expanding its lineup and enhancing customer experience in the segment.
Besides high competition, Honda is confronting several other headwinds in its global operations, including slower growth in the electrification market, relaxed environmental regulations across multiple countries, a shift away from multilateral free trade amid rising protectionism and increased supply chain vulnerabilities due to broader global sourcing.
Honda’s Zacks Rank & Key Picks
HMC stock currently has a Zacks Rank #4 (Sell).
Some better-ranked stocks in the auto space are Standard Motor Products, Inc. SMP, Magna International MGA and Geely Automobile GELHY. While SMP sports a Zacks Rank #1 (Strong Buy), MGA and GELHY carry a Zacks Rank #2 (Buy) each at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for SMP’s 2026 sales and earnings implies year-over-year growth of 3% and 9.5%, respectively. The EPS estimates for 2026 have decreased 4 cents over the past 60 days.
The Zacks Consensus Estimate for MGA’s 2026 sales and earnings implies year-over-year growth of 2.3% and 19%, respectively. The EPS estimate for 2026 and 2027 has improved 10 cents and 30 cents, respectively, over the past 60 days.
The Zacks Consensus Estimate for GELHY’s 2026 sales and earnings implies year-over-year growth of 73.6% and 28.9%, respectively. The EPS estimate for 2026 has improved 15 cents over the past 90 days, while that for 2027 has risen 12 cents over the past 30 days.
7 Best Stocks for the Next 30 Days
Just released: Experts distill 7 elite stocks from the current list of 220 Zacks Rank #1 Strong Buys. They deem these tickers "Most Likely for Early Price Pops."
Since 1988, the full list has beaten the market more than 2X over with an average gain of +23.9% per year. So be sure to give these hand picked 7 your immediate attention.
See them now >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Honda Motor Co., Ltd. (HMC): Free Stock Analysis Report
Magna International Inc. (MGA): Free Stock Analysis Report
Standard Motor Products, Inc. (SMP): Free Stock Analysis Report
Geely Automobile Holdings Ltd. (GELHY): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).