Kurt Verlin
No Comments

Honda and LG to Build $4.4B Battery Factory in U.S.

Decrease Font Size Increase Font Size Text Size Print This Page
Youngsoo Kwon and Toshihiro Mibe
Youngsoo Kwon (left), CEO of LG Energy Solution, and Toshihiro Mibe, President and CEO of Honda Motor Company
Photo: Honda

The Honda Motor Company and LG Corporation today announced they will invest $4.4 billion in a joint venture in the United States to produce car batteries, intended for use in Honda and Acura EV models in North America.

Construction is expected to begin in early 2023 and production ready by the end of 2025, with an annual production capacity of approximately 40 GWh. However, the site of the new battery factory has yet to be decided. One of the most likely candidates is Ohio, as the automaker already has a massive manufacturing complex near Marysville — and Ohio Governor Mike DeWine is trying to ensure it happens.

Related: Top reasons to buy a Honda

“With automakers moving to manufacture more and more electric vehicles, we want Honda to expand its operation in Ohio,” DeWine said. “For almost 40 years, Ohio has been at the center of Honda’s North American vehicle production, and we are working with Honda and LG to ensure that they choose Ohio for this new electric battery plant.”

This announcement is part of a growing trend in the industry as automakers expand their partnerships with battery manufacturers to stay ahead in the race toward an EV future. Last year, Toyota announced it would invest $3.4 billion in U.S. battery production through 2030, including a new plant. GM’s own partnership with LG involves two Ultium battery plants, one in Ohio and another in Tennessee.

Like Toyota, Honda has been somewhat slow to put all of its eggs in the EV basket, believing that demand is not quite there yet and that it isn’t necessarily the best way to achieve carbon neutrality. Its target of 100% electrified vehicle sales by 2040 is behind its peers, though its goal to “realize carbon neutrality for all products and corporate activities the company is involved in by 2050” is about in line with the rest of the industry.

A recently passed U.S. law includes a $7,500 incentive to EVs that contain a battery built in North America with 40% of the metals mined or recycled on the continent. This new Honda venture shows that how incentives can be for manufacturers just as much for buyers.