Honda and LG Energy Solutions are going big on US-made EV batteries.
In Seoul, Honda and LG Energy Solutions (LGES) announced a partnership to manufacture EV batteries in the US. These lithium-ion batteries are planned to be used in future Honda and Acura vehicles, as the brand transitions to offering only EVs by 2040. The batteries made in this future US factory will find their way into Honda EVs, exclusively.
This new joint-venture plant will have $4.4 billion from Honda and will have a production capacity of 40GWh (gigawatt-hours), annually. The location hasn’t been finalized, but Honda and LGES plan to break ground on the factory in 2023, with goals to start full-scale battery production by the end of 2025. LG and Honda chose the United States to build, for strategic reasons. The two companies believe that “expanding local electric vehicle production and ensuring the timely supply of batteries would put them in the best position to target the rapidly-growing North American EV market.”
The LGES/Honda plant seems like the prime opportunity to make Honda EVs more competitive. The Inflation Reduction Act eliminates tax credit subsidies for EVs not made in North America, and EVs that don’t use North American batteries. A North American battery plant would be just what Honda needs to assure its models are eligible for tax credit subsidies.
These battery manufacturing plans are part of Honda’s goals; first full electrification by 2040, then total carbon neutrality by 2050.
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