In order to acquire batteries for fully electric vehicles, Honda Motor Co announced recently that its Chinese unit will form a joint venture with Dongfeng Motor Group and Guangzhou Automobile Group Co. at the end of the month.
To ensure a stable supply of batteries, the automaker’s Chinese branch has also agreed to strengthen its current collaboration with CATL, the largest battery manufacturer in the world.
Currently, the batteries for Honda’s joint ventures Dongfeng Honda and Guangqi Honda, which manufacture and sell four-wheel cars in China, are purchased separately from CATL.
However, the most recent adjustment will enable centralization of battery purchase through the soon-to-be-launched joint venture. Dongfeng, Guangzhou, and Honda will each contribute 25% to the joint venture, which will have a 50% Honda investment.
The Japanese automaker recently said that it had formed a partnership with trading company Hanwa Co to secure a stable supply of metals used in batteries for electrified vehicles.
This year Honda laid out a target to roll out 30 electrified vehicle (EV) models globally and produce more than 2 million EVs a year by 2030. It aims at selling only fully electric vehicles and fuel cell electric vehicles by 2040.
Honda Chief Executive Toshihiro Mibe said, “As far as resource investments over the next 10 years go, we’re going to invest about 8 trillion yen in research and development expenses.”
He also said Honda wanted to establish a dedicated electric vehicle production line in North America, where it will also procure Ultium batteries from General Motors Co.