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LG Energy Solution and Honda to form a joint venture

LG Energy Solution (LGES) and Honda Motor Co. announced Monday an agreement to establish a joint venture (JV) to produce lithium-ion batteries in the United States.

According to a joint statement, the production is intended to power Honda and Acura EV models for the North American market.

With this agreement, LGES and Honda will invest a total of $4.4 billion and establish a new JV plant in the United States.

The plant is intended to have an annual production capacity of approximately 40GWh.

The pouch-type batteries produced at the new JV plant will be supplied exclusively to Honda’s North American facilities.

Although the location of the JV plant has not yet been finalized, based on Honda’s plans for electric vehicle production in North America, the two companies intend to begin construction in early 2023, with the goal of enabling the start of mass production of advanced lithium-ion battery cells by the end of 2025.

LG Energy Solution and Honda made the decision to establish the joint venture battery plant in the United States based on the shared belief that expanding local EV production and ensuring timely battery supply would put them in the best position to target the rapidly growing North American EV market.

“Our joint venture with Honda, which enjoys a significant brand reputation, is a further milestone in our medium- to long-term strategy of promoting electrification in the fast-growing North American market,” said Youngsoo Kwon, CEO of LG Energy Solution.

LG Energy Solution

“As our ultimate goal is to earn the trust and respect of our valued customers, we aspire to position ourselves as a leading battery innovator by collaborating with Honda in pursuing its major electrification initiatives, as well as providing sustainable energy solutions to demanding end consumers,” Youngsoo added.

For his part, Toshihiro Mibe, resident, CEO and representative director of Honda Motor Co, commented that Honda is working toward its goal of achieving carbon neutrality in all products and corporate activities in which the company is involved by 2050.

“In keeping with our long-standing commitment to build products close to the customer, Honda is committed to local procurement of electric vehicle batteries, which is a critical component of electric vehicles. This initiative in the U.S. with LGES, the leading global battery manufacturer, will be part of this Honda approach,” said Mibe.

 

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