Honda partners LG Energy to build EV battery plant in this country

Japanese automaker Honda Motor Co has partnered Korean battery supplier LG Energy Solution Ltd to set up a new lithium-ion battery plant for electric vehicles in the US, the Nikkei business daily reported. The move comes as various battery makers in the country are looking to increase production, making a shift toward electric vehicles. This could, in turn, increase as the country implements stricter regulation and tightens tax credit eligibility.

Both the companies are expected to invest on a scale of several hundred billion yen, the report added. The US government has been pushing policies designed to bring more battery and EV manufacturing into the country. US President Joe Biden recently signed a $430 billion climate, health care and tax bill that would render electric vehicles assembled outside North America ineligible for tax credits.

Last week, California announced a plan mandating all new vehicles sold in the state by 2035 to be either electric or plug-in electric hybrids. Now, both Honda and LG Energy Solution will establish a joint venture to start producing lithium-ion batteries in Ohio, US, where Honda's main factory is located, the report stated.

LG Energy Solution is mainly engaged in the development of lithium-ion battery materials and next-generation batteries as well as supply of EV batteries. It has signed joint-venture agreements with General Motors, Hyundai Motor Co and Stellantis.

In July, Panasonic Energy Co, which is a unit of tech conglomerate Panasonic Holdings Corp and a major Tesla Inc supplier, said it had selected Kansas as the site for a new battery plant with investment of up to $4 billion. Earlier this year, Honda laid out a target to roll out 30 EV models globally and produce about 2 million EVs a year by 2030.