Honda to Invest $39 Billion With Focus on EVs, Batteries
The motor conglomerate aims to launch 30 EV models worldwide
April 18, 2022
Honda Motors has announced that it will invest approximately 5 trillion yen (~$39.84 billion) in electrification and software technologies to accelerate its business globally in the next ten years. The motor vehicle conglomerate plans to invest 8 trillion yen (~$63.74 billion) in research and development until 2030.
Honda will build a demonstration line to produce all-solid-state batteries in North America, allocating approximately 43 billion yen (~$342.65 million). Through this investment, Honda will launch two mid-to-large-scale electric vehicles (EV) models by 2024 — Prologue SUV and Acura brand, jointly being developed with General Motors (GM).
Starting this financial year, Honda has moved its core technology areas from its product-based organizations and combined under the newly formed Business Development Operations. These core areas include electrified products and services, energy, battery, mobile power pack, hydrogen, and software technologies.
Battery procurement strategy
Honda aims to stabilize the procurement of liquid lithium-ion batteries in each operating region by focussing on building external partnerships. It will procure Ultium batteries from GM in North America. In Japan, Honda will procure batteries for mini EVs from Envision AESC. In China, it will strengthen its collaboration with Contemporary Amperex Technology, a global lithium-ion battery manufacturer.
Honda will begin the adoption of its e-architecture in 2026, an EV platform to combine the software and hardware platforms.
The company is also set to device reliable connected frameworks in its EVs where users will be connected to the energy and information stored in every product.
Honda plans to launch 30 new EVs by 2030
In its partnership with GM, Honda intends to make EVs affordable by 2027, with a competitive price range to match the gasoline-powered vehicles, beginning with North America.
In Japan, the company is mulling the introduction of personal-use mini-EVs and EV Smart Utility Vehicles (SUV) by 2024. It also plans to launch a commercial-use mini-EV model in the 1-million-yen price range in the same year.
Honda also announced that it will introduce ten new EV models by 2027 in China. The motor giant plans to erect a dedicated EV plant in Guangzhou and Wuhan.
Overall, the motor conglomerate aims to launch 30 EV models worldwide by the end of the decade, with a production volume of over 2million units every year.
Honda issued green bonds worth $2.75 billion in March 2022 and intends to allocate the proceeds to develop and produce zero-emission vehicles.
The company will fund startups with high-potential advanced technologies and business models for 10 billion yen (~$79.70 million) each year.
In November 2021, Honda and construction engineering company Black & Veatch successfully tested the prototype Honda Autonomous Work Vehicle (AWV) at a Black & Veatch construction site in New Mexico.
According to a recent report by BloombergNEF (BNEF), the investments in electrified transport, including electric vehicles and associated infrastructure, were $273 billion in 2021. The investment in electrified transport increased by 77% due to the surge in sales of electric vehicles. The industry is expected to overtake renewable energy in dollar terms in 2022.