Honda Motor and LG Energy will build a $4.4 billion EV battery plant in the US

Honda Motor and LG Energy will build a $4.4 billion EV battery plant in the US
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TOKYO/WASHINGTON, August 29 (Reuters) – Japan’s Honda Motor Co (7267.T) Korean battery supplier LG Energy Solution Ltd will build a new $4.4 billion lithium-ion battery plant for electric vehicles in the United States. (373220.KS)the two companies said Monday.

Battery makers are trying to ramp up production in the US, where the shift to electric vehicles (EVs) could increase as the country imposes stricter regulation and tightens tax credit eligibility.

The location of the plant has not been specified, the companies said, but two people briefed on the matter confirmed that Honda is seriously considering Ohio, home to Honda’s main U.S. factory.

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The companies aim to achieve about 40 GWh of annual production capacity with batteries supplied exclusively to Honda facilities in North America to power Honda and Acura EV models.

The pair are expected to form a joint venture before starting construction of the plant, with construction scheduled to begin in early 2023 and mass production by the end of 2025.

Ohio Governor Mike DeWine said his administration is working with Honda and LG to select Ohio for this new electric battery plant. Sources briefed on the matter said an announcement on the location could come within weeks.

The US government is pushing policies designed to bring more battery and EV production to the country.

President Joe Biden this month signed a $430 billion climate, health care and tax bill that makes electric vehicles assembled outside North America ineligible for tax credits. read more

The Honda Motor logo is pictured at the 43rd Bangkok International Motor Show on March 22, 2022 in Bangkok, Thailand. REUTERS/Athit Perawongmetha

White House Deputy National Climate Advisor Ali Zaidi praised Honda LG for the “huge investment” he said catalyzed climate and infrastructure legislation.

US Energy Secretary Jennifer Granholm said the administration is “bringing back domestic battery manufacturing to provide Americans with good-paying jobs that will power the electric vehicle revolution.”

California unveiled a plan last week that would require all new cars sold in the state to be either electric or plug-in hybrids by 2035. read more

The two companies said the combination of strong domestic electric vehicle production and timely supply of batteries will make them “best positioned to target the rapidly growing North American electric vehicle market.”

LG Energy Solution, which mainly develops lithium-ion battery materials and next-generation batteries, also supplies EV batteries and has signed joint venture agreements with General Motors. (GM.N)Hyundai Motor Co (005380.KS) and Stellanthis (STLA.MI). read more

In July, Panasonic Energy Co., a unit of tech conglomerate Panasonic Holdings Corp. (6752.T) and Major Tesla Inc (TSLA.O) The supplier said it has chosen Kansas for a new battery plant with an investment of up to $4 billion. read more

Earlier this year, Honda aimed to introduce 30 EV models globally and produce about 2 million EVs annually by 2030. read more

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Reporting by Satoshi Sugiyama and Heekyong Yang in Seoul and David Shepardson in Washington; Edited by Rashmi Aich Krishna Chandra Eluri, Kirsten Donovan, and Chris Reese

Our standards: Thomson Reuters Trust Principles.

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