Honda’s EV Plans Will End Mega-Dealerships


Honda’s electrification plans might result in a complete redesign of traditional mega-dealerships. The company aims to offer flexible spaces and dealerships with fewer EVs in the inventory.

By 2030 Japanese automaker Honda expects BEVs and FCEVs to be responsible for around 40% of its US product portfolio. To achieve this target, the company is partnering with General Motors to use GM’s Ultium battery architecture. The platform will underpin two electric offerings, including the all-new Honda Prologue, planned for 2024. As the Japanese brand preps for the release of the Prologue, the company is overhauling Honda’s mega-dealerships to offer a more EV-friendly space.

The company wants to redesign the dealerships to offer more flexible spaces and is updating the buying process to bestow customers with a new purchase experience. As a result, Honda plans to offer smaller dealerships with less dealer space and less EV inventory. This means that the mega-dealerships we are so familiar with are quickly coming to their end.

Electric vehicle pioneer Tesla was the first automaker to employ this business model. Afterwards, companies like Rivian Volvo and Ford started using e-retail and direct sales for their electric models like the C40 Recharge, Mustang Mach-E and the all-new F-150 Lightning. Honda is also considering developing a virtual showroom.


The new dealership design will be similar to a retail space which will act as a pit stop in the purchase process.

As a result of the ongoing pandemic, the semiconductor shortage has limited the inventories of almost every major automaker. Therefore companies are struggling to meet their sales targets. The new retail spaces will be a destination where customers can pick up their EVs after making their online purchases. The new stores will also double as a location where owners can go to service their cars.

Interestingly enough, even in the fallout of COVID-19, automakers are reporting steady growth in EV sales. The dealerships that fail to scale usually get bought out. However, even these consolidated mega-dealerships cannot sustain their business model in the age of digitization. The high cost of managing extensive inventories results in the downfall of these mega dealerships. Thanks to online reservations, companies no longer have to put up with unwanted cars, which they later have to sell at a discount.

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