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Honda and LG invest $4.4 billion in U.S. battery plant

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Daniel Rufiange
Partnerships between battery makers and automakers are on the rise, proof that the electric shift has reached a tipping point.

If some people still have doubts about the electric shift, pay attention to all the news about the construction and agreements for the manufacturing of batteries and the exploitation of the resources that compose them; they speak for themselves.

The latest in line involves Honda and South Korean battery manufacturer LG Energy Solution. Together, the two firms will invest US$4.4 billion on a new battery plant in the United States. Honda wants to eliminate gasoline-powered vehicles from its lineup by 2040.

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The planed factory will have an annual capacity of about 40 gigawatt hours and mass production is expected to begin in late 2025, Honda said Monday via a statement. The new partners will form a joint venture this year in which Honda will hold a 49 percent stake by investing 1.7 billion. Construction is expected to begin in early 2023.

What is not yet known is where the plant will break ground. Bloomberg reported in June that Ohio was the leading candidate. This makes sense, because the Japanese firm already has car manufacturing plants there.

Honda plans to invest $36 billion to make its electric shift over the next decade, all while introducing some 30 new models.

"Honda is working to achieve its goal of carbon neutrality for all products and operations of the company by 2050. In line with our long-standing commitment to building products close to the customer, Honda is committed to local sourcing of electric vehicle batteries. This initiative in the U.S. with LG Energy, the world's leading battery manufacturer, will be part of such an approach by Honda," said Toshihiro Mibe, Honda's chief executive officer, via the company's statement released Monday.

 

Daniel Rufiange
Daniel Rufiange
Automotive expert
  • Over 17 years' experience as an automotive journalist
  • More than 75 test drives in the past year
  • Participation in over 250 new vehicle launches in the presence of the brand's technical specialists