Japan's Honda Motor plans to launch a small electric vehicle priced below $30,000 in North America by as early as 2026, the Nikkei newspaper said on Tuesday, as it plays catch-up in the battery-powered car market.

According to Nikkei, Honda plans to launch a smaller EV priced under $30,000 in the US as early as 2026. It will be made locally, starting with the batteries, to cut costs. The new EV is expected to be the entry-level model for its upcoming Honda 0 Series. It will be a cornerstone for Honda’s global expansion.

The affordable Honda EV, which could go on sale by 2026, may be produced in the Ohio factory, avoiding potential tariffs

The company has a target to have battery-powered and fuel-cell vehicles make up all of its new car sales by 2040. Shares of Honda Motor ( HMC) traded flat in premarket action at $28.80 vs. the 52-week range of $23.41 to $37.90.

Honda Motor Co., a Japanese automotive giant, is poised to make a significant push into the North American electric vehicle (EV) market with a strategic focus on affordability. According to a report in the Nikkei newspaper,

Honda (NYSE:HMC), the Japanese automaker plans to launch a new electric vehicle in North America that will be priced below $30,000, Nikkei reported on Tuesday.

Honda is gearing up to add the first mainstream electric car into the New Zealand market. The awkwardly-named e:Ny1 was the brand’s second electric car following the prototype-like 'e' city car that was not officially sold new in Australia (though there are grey import examples running around).