LG Energy Solution (LGES) and Honda Motor Co. announced on Monday that it had agreed to form a joint venture to manufacture lithium-ion batteries in the US. The plant will power Honda and Acura electric vehicle (EV) models for the North American market.
LGES and Honda will invest a total of $4.4 billion to establish this joint venture. The plant will produce bag batteries and will be supplied exclusively to Honda facilities in North America.
Honda CEO Toshihiro Mibe said in a statement: “In line with our longstanding commitment to building customer-friendly products, Honda is committed to local procurement of EV batteries, a component importance of EVs”.
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The location of the plant is yet to be determined but construction will begin in early 2023, allowing for mass production of advanced lithium-ion battery cells by the end of 2025.
LGES and Honda decided to build a plant in the United States to get closer to the rapidly growing electric vehicle market in North America.
LGES CEO Youngsoo Kwon said: “Our joint venture with Honda, which enjoys considerable brand reputation, is another milestone in our mid- and long-term strategy to promote electric power. gasification in the rapidly growing North American market.
Although the US accounts for only 10% of the global electric vehicle market, the US market grew 62% year-on-year in the first half of 2022, according to a report released by the company. Report of Canalys.
The plant hopes to have an annual production capacity of 40 GWh, which is an incredible capacity. In mid-2018, the Tesla Gigafactory I in Sparks, NV reached an annual capacity of about 20 GWh, making it the highest-volume battery plant in the world, according to Tesla’s website.
