Honda and LG Energy Solutions joint venture (JV) broke ground on their $3.5 billion EV battery plant in Fayette County, Ohio, Tuesday as the company aims to begin mass production in 2025.
Honda and LGES break ground on $3.5 billion Ohio EV plant
A few months ago, in October, Honda and LG Energy Solutions (LGES) formed a new joint venture while committing to invest $3.5 billion in a new electric vehicle battery factory in the state.
The announcement is part of automakers’ strategy to turn Ohio into Honda’s “EV hub,” including a separate $700 million investment to retool three plants in the state for EV production.
As part of the automaker’s commitment, the new battery production facility will manufacture pouch-type batteries, which will be supplied to Honda’s plants for future EVs. Honda said construction was planned for early 2023, and the company is sticking to its timeline.
According to Honda In America’s Twitter post, LGES and Honda JV kicked off construction on its $3.5 billion EV battery plant Tuesday.
Honda expects the new facility to be completed by the end of 2024, enabling them to start mass-producing EV battery modules using advanced pouch-type lithium-ion cells by the end of 2025.
Annual production capacity is expected to reach 40 GWh when the facility is fully operational.
Honda recently announced it was overhauling business operations, including creating a new Electrification Business Development Operations to consolidate and streamline development in order to accelerate its EV rollout.
The Japanese automaker revealed its first electric SUV, the Honda Prologue, co-developed with GM, in October. The Prologue will begin pre-sales this year, followed by deliveries in 2024 alongside Acura’s first fully electric vehicle, the ZDX.
Honda’s CEO, Toshihiro Mibe, who took over in 2021, is trying to get the company back on track to stay competitive. The Ohio battery plant will play a central role in Honda’s EV strategy in the US.
Despite having plans to build on its own e: Architecture EV platform, it won’t be until 2026, in line with when the battery plant is expected to become fully operational. Until then, the automaker will rely on GM’s technology.
The new plant and EV platform will help Honda streamline production and lower costs, but that won’t be until at least a few more years.
The competition is already achieving double-digit (or 100%) EV sales while expanding production capabilities. Honda may risk doing too little too late with a few years left before its plans come to fruition.