Honda Motor, LG Energy to build $4.4 billion US EV battery plant

TOKYO/WASHINGTON, Aug 29 (Reuters) – Japan’s Honda Motor Co (7267.D) Korean battery supplier LG Energy Solutions Ltd. will build a $4.4 billion lithium-ion battery plant for electric vehicles in the United States. (373220.KS)Both companies said Monday.

Battery makers expect to ramp up production in the US, where the shift towards electric vehicles (EV) could increase as the country implements tighter regulations and tightens tax credit eligibility.

The companies said the location of the plant has not been finalized, but two people briefed on the matter.

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The companies are aiming for 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 establish a joint venture before building the plant, with construction scheduled to begin in early 2023 and mass production by the end of 2025.

Ohio Gov. Mike DeWine said his administration is working with Honda and LG to “make sure Ohio is chosen for this new electric battery plant.” An announcement on the location could be made within weeks, sources briefed on the matter said.

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

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

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

Ali Zaidi, the White House deputy national climate adviser, hailed the Honda LG as a “great investment,” saying he was motivated by climate and infrastructure laws.

U.S. Energy Secretary Jennifer Granholm said, “The administration is bringing back domestic battery manufacturing to provide good-paying jobs for Americans powering the EV revolution.”

California announced a plan last week to require all new vehicles sold in the state to be electric or plug-in electric hybrids by 2035. read more

The combination of strong local electric vehicle production and timely supply of batteries will “position it well to target the rapidly growing North American EV market,” the two companies said.

LG Energy Solutions, which is mainly involved in developing lithium-ion battery products 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 Stellandis (STLA.MI). read more

In July, Panasonic Energy Co acquired technology conglomerate Panasonic Holdings Corp. (6752.D) And a big Tesla Inc (TSLA.O) The supplier said it has chosen Kansas as the site for a new battery plant with an investment of up to $4 billion. read more

Earlier this year, Honda set a target of launching 30 EV models globally and producing around 2 million EVs annually by 2030. read more

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Reporting by Satoshi Tsukiyama and Heekyong Yang in Seoul and David Shepherdson in Washington; Editing by Rashmi Ich Krishna Chandra Eluri, Kirsten Donovan and Chris Rees

Our Standards: Thomson Reuters Trust Principles.

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