The Japanese automaker Honda Motor Co. and South Korean battery maker LG Energy Solution Ltd. recently announced a joint investment of $4.4 billion in the United States to produce lithium-ion batteries for Honda electric vehicles in the North American market.
As of now, the location of the planned battery plant is not yet finalized but its construction is expected to begin in early 2023. By the end of 2025, the mass production of advanced lithium-ion battery cells will commence at its full capacity, according to CBS News.
“Honda is committed to the local procurement of EV batteries which is a critical component of EVs,” Honda CEO and President Toshihiro Mibe said in a statement. “This initiative in the U.S. with LGES, the leading global battery manufacturer, will be part of such a Honda approach.”
The establishment of the said joint venture is anticipated for this year, and the deal’s closing is contingent upon regulatory approval.
“Our joint venture with Honda, which has significant brand reputation, is yet another milestone in our mid- to long-term strategy of promoting electrification in the fast-growing North American market,” said LG Energy Solution Chief Executive Youngsoo Kwon.
According to a joint statement, the factory would only make batteries for Honda vehicles built in North America, including the luxury brand Acura.
LG, the leading producer of lithium-ion batteries for EV and power systems, has already formed joint ventures with Hyundai Motor Group in South Korea, General Motors, and Ford Motor Co. in the United States. Although the firm has activities all around the world, including the United States, China, and Australia, its headquarters are in Seoul, South Korea.
“Honda is working toward our target to realize carbon neutrality for all products and corporate activities the company is involved in by 2050,” said Honda Chief Executive Toshihiro Mibe.
Due to concerns about climate change, pollution, and rising gas prices, the demand for electric vehicles is anticipated to increase in the United States and many other countries. Therefore, leading automakers in the world are expanding their EV lines to catch up.