Honda said on Monday that it would phase out all diesel cars by 2021 in favour of models with electric propulsion systems, as the Japanese carmaker moves to electrify all of its European cars by 2025.

Honda is the latest carmaker to cut production of diesel cars to meet stringent global emissions regulations. The plan is part of its long-term goal to make electric cars, including all battery-electric vehicles, to account for two-thirds of its line up by 2030 from less than 10% now.

By next year, according to European Union emission targets, CO2 must be cut to 95 gram per km for 95% of cars from the current 120.5 gram average, a figure that has increased of late as consumers spurn fuel-efficient diesels and embrace SUVs. All new cars in the EU must be compliant in 2021.

For Honda, declining demand for diesel vehicles and tougher emissions regulations have clouded its manufacturing prospects in Europe.

Honda said in February it would close its only British car plant in 2021 with the loss of up to 3500 jobs.

Japan's third biggest carmaker has said it would cut the number of car model variations to a third of current offerings by 2025, reducing global production costs by 10% and redirecting those savings toward advanced research and development. 

Reuters