Honda and LG Energy will invest $4.4 billion in a joint venture battery plant in the US

Today in South Korea, Honda and LG Energy announced a joint venture they're creating for the US market. This joint venture will be tasked with establishing a plant for EV batteries in the US.

The batteries made there will be used to power Honda and Acura EVs sold in the North American market. The total investment from the two companies in the EV battery factory will be $4.4 billion. The plant aims to have an annual production capacity of around 40 GWh.

It will make pouch-type batteries, and supply exclusively to Honda facilities in North America. The location of the plant is "yet to be finalized", which most likely means there are still harsh negotiations ongoing with US states regarding tax breaks and various incentives.

That said, construction on the battery factory is planned to begin in early 2023, in order to enable the start of mass production of cells by the end of 2025. LG Energy and Honda chose the US for the battery plant site in order to be in the best possible position to target "the rapidly-growing North American EV market".

Toshihiro Mibe, Honda's President and CEO, said:

Aligned with our longstanding commitment to build products close to the customer, Honda is committed to the local procurement of EV batteries which is a critical component of EVs. This initiative in the U.S. with LGES, the leading global battery manufacturer, will be part of such a Honda approach.