Back in 2020, Honda decided it was going to quit Formula One which created a string of events which has in some way revolutionised the sport.
The reason the Japanese manufacturer was diverting its vast spend on the pinnacle of motor racing was to shift its development budget away from internal combustion engines and toward “carbon neutrality, sustainability, and mass-production electric vehicle (EV) technologies.”
A Historic Financial Blow
Now these plans lie in ruins as the Japanese road car manufacturer has published its first-ever financial report declaring losses since the Japanese manufacturer was listed on the stock exchange in 1957.
And those losses are not exactly minimal. At 423 billion yen ($2.68 billion) for the fiscal year ending in March together with gigantic 1.68trillion yen write down, this kind of spend and losses amount to more than Liberty Media paid for F1.
The Red Bull Powertrains Catalyst
The impact of Honda initially withdrawing from F1 was that Red Bull Racing took the historic decision to become the first-ever engine customer team in the sport to build its own powertrain entirely unaided.
Now the Red Bull Powertrains division has developed a miraculous product not far behind that of Ferrari and Mercedes. The reasons Honda decided to leave F1 were based on their guesstimates of what the future of road car manufacturing would and should look like in the future.
The “Once-in-a-Hundred-Years” Industry Shift
Honda’s President and CEO at the time, Takahiro Hachigo, emphasised that the entire automotive landscape was undergoing a massive, generational transition toward electrification.
“In the meantime, as the automobile industry undergoes a once-in-a-hundred-years period of great transformation, Honda has decided to strive for the ‘realisation of carbon neutrality by 2050.’ This goal will be pursued as part of Honda’s environmental initiatives which is one of the top priorities of Honda as a mobility manufacturer.” — Takahiro Hachigo, Honda President and CEO (Official Press Conference, October 2, 2020).
Diverting R&D Resources to Green Technology
Honda explicitly stated that its top engineers and financial resources needed to be moved from the racetrack to the laboratory to solve consumer energy problems.
“To this end, Honda needs to funnel its corporate resources in research and development into the areas of future power unit and energy technologies, including fuel cell vehicle (FCV) and battery EV (BEV) technologies, which will be the core of carbon-free technologies.
As a part of this move, in April of this year, Honda created a new centre called Innovative Research Excellence, Power Unit & Energy… Honda made the decision to conclude its participation in F1” — Official Honda Corporate Statement (October 2, 2020).
The Ultimate Formula One Irony
The following year being Honda’s final official season in F1, the irony of the company’s decision was beyond belief as the 2021 season concluded with Red Bull in partnership with Honda breaking a seven-year domination by Mercedes of F1. Max Verstappen beat Lewis Hamilton on the final lap of the final race in Abu Dhabi to claim the drivers’ world championship driven by Honda power.
With the FIA instigating a freeze on F1 engine development the following season until 2026, Honda remained nominally in F1 supporting Red Bull with their existing F1 engine rebadged as Red Bull Powertrains (RBPT).
Championship Success and a New Partnership
The following three years brought the Japanese manufacturer even more F1 success; another three drivers’ titles along with two constructors’ titles in their Red Bull association.
Having tasted success once again after years in the wilderness, it appeared the collective psyche back at Honda HQ decided they could continue their F1 project along with their plans for the autocar electrification revolution.
Yet Red Bull Racing had moved on and despite the offer from Honda to continue their partnership, the Austrian-owned racing team under the leadership of Christian Horner decided they would plough their own furrow in the future. So Honda found a new bedfellow in Aston Martin and announced their F1 future together in May 2023.
The Problem with the 2026 Engine Rules
Honda along with Audi and Mercedes had driven the new F1 power unit agenda in the FIA power unit manufacturers’ working party. The three insisted on a powertrain which received 50% of its output from the battery and the rest from the internal combustion engine.
The committee set out to design a horse and the result we now see is in fact a camel. Not only has the electrification dream ruined F1 for now, but it appears the global vision for electrified road-going cars is not being realised either.
The Market Backlash and Strategic Reversals
According to CEO Toshihiro Mibe, the massive deficit announced by Honda is the result of gigantic up-front investments in electric vehicles (EVs) that have yet to yield expected returns. A major roadblock has been the United States market.
Following President Donald Trump’s decision to scrap the $7,500 EV consumer tax credit in September 2025, EV adoption slowed dramatically. In response to these market shifts, Honda is pivoting its automotive strategy:
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Canada Investment Paused: An $11 billion plan to build EVs and battery manufacturing plants in Canada has been suspended.
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Sales Targets Scrapped: Honda has abandoned its target for EVs to make up 20% of its global sales by 2030, alongside pausing its goal to sell exclusively electric cars by 2040.
What This Means for F1’s Engine Future
Honda’s retreat from aggressive electrification mirrors a shifting sentiment inside the F1 paddock. When the 2026 engine regulations were originally drafted, manufacturers like Honda and Audi pressed heavily for high electrification. Today, the sport’s leadership is reconsidering that trajectory in favour of sustainable internal combustion engines (ICE).
After all, there are 2 billion road-going vehicles in existence across the planet right now and the swiftest fashion to reduce carbon emissions and ‘save the planet’ would be to design carbon-neutral fuels for them to run upon.
A Shift in Leadership Vision
F1 CEO Stefano Domenicali admitted that the sport may have catered too much to manufacturer visions of the future at the time the current hybrids were conceived.
He recently observed that the global outlook has since evolved, stating he wants to see “sustainable fuel at the centre of the future, with a different balance of what could be the electrification in the future with a strong internal combustion engine.”
The Promised Return of the V8
“A V8 will definitely return. It’s coming. At the end of the day, it’s a matter of time. In 2031, the FIA will have the power to do it, without any votes from the power unit manufacturers… But we want to bring it one year earlier, which everyone now is asking for” — Mohammed Ben Sulayem, FIA President.
F1 Must Move Away from Road Relevance
Formula One and its governing body must learn the lesson from the heavy price the sport is paying presently. Fans are up in arms over the ‘fake racing’ and ‘yo-yo overtaking’ the massive electrification of the engines has brought about and the drivers are unified that this is “far from how F1 should be.” – Carlos Sainz.
It is a seismic moment for the biggest annual global sport in the world to digest. Just as the multibillion-dollar sport of horse racing no longer has any association with its previous form of public transport – so motor racing needs not to be associated with ‘road car relevance’ and the auto manufacturers must be prevented in future from using F1 as their own personal technical laboratory.
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With over 30 years of experience in Formula 1 as an insider journalist, I have built trusted connections across the paddock, from race engineers and mechanics to senior team figures. At The Judge 13, I and a handful of trusted colleagues share exclusive Formula 1 news, expert analysis and behind-the-scenes stories you will not find in mainstream motorsport media.
A.J. Hunt is Senior Editor at TJ13, where Andrew oversees editorial standards and contributes to the site’s Formula 1 coverage. A career journalist with experience in both print and digital sports media, Andrew trained in investigative journalism and has written for a range of European sports outlets.
At TJ13, Andrew plays a central role in shaping the site’s output, working across breaking news, analysis, and long-form features. Andrew’s responsibilities include fact-checking, refining editorial structure, and ensuring consistency in reporting across a fast-moving news cycle.
Andrew’s work focuses particularly on the intersection of Formula 1 politics, regulation, and team strategy. Andrew closely follows developments involving the FIA, team leadership, and driver market dynamics, helping to provide context behind the sport’s biggest stories.
With experience covering multiple seasons of Formula 1’s modern hybrid era, Andrew has developed a detailed understanding of how regulatory changes and competitive shifts influence the grid. Andrew’s editorial approach prioritises clarity and context, aiming to help readers navigate complex developments within the sport.
In addition to editorial duties, Andrew is particularly interested in how media narratives shape fan perception of Formula 1, and how reporting can balance speed with accuracy in an increasingly digital news environment.
