Battery cells for electric cars: Honda and LG to build joint factory in US

Honda and LG Energy Solutions (LGES) this week began building a joint factory in the US to produce batteries for electric cars. For this, the two companies have jointly undertaken a joint venture for the first time, a Japanese car company and a Korean battery manufacturing company. The total investment is $4.4 billion, but Honda also plans to produce electric cars in North America.

A battery plant is being built in Fayette County, Ohio, and is expected to create 2,200 new jobs. Construction of the 185,000 square meter factory is scheduled to be completed by the end of 2024. The first lithium-ion batteries could be delivered to Honda’s car factories from the end of 2025. The companies estimate the total capacity of all battery cells produced there to be 40 gigawatt hours per year. These batteries will be used exclusively in Honda’s electric cars sold in North America.

Honda is converting factories to electric cars

At the same time, Honda plans to invest $700 million to convert existing car plants in Ohio to electric car production. These are to be equipped with suitable batteries through a new battery plant. Production and sales of Honda’s electric cars in Ohio are scheduled to begin in 2026. By 2040, the Japanese group wants to transition its car production to fully electric vehicles.

LGES is one of the largest battery manufacturers in the world and produces over 200 gigawatt hours per year. By the end of 2023, the Korean company wants to increase this to a total of 300 GWh. News from Honda And the joint venture is tentatively called LH Battery Company. Most battery cells in electric cars still come from China.

The head of the joint venture cites growing demand for electric cars, particularly in the US, as the reason for choosing the location for battery cell production. However, subsidies may also have played a role, as there has been a boom in battery cell production in the US due to tax incentives. The US government’s anti-inflation bill passed in 2022 makes manufacturing in the country more attractive.

(fds)