Honda Motor
Japan-based Honda and Korea-based LG say they'll be investing $4.4 billion to establish the new plant with a goal annual production capacity of around 40 gigawatt hours. The batteries manufactured in the plant will be used in Honda and Acura EVs manufactured in North America.
"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," Honda CEO Toshihiro Mibe was quoted in a press release.
Recently, Honda announced that it was aiming to release 30 new EV models and 2 million individual EVs by 2030.
In all likelihood, the plant will be located near one of Honda's four U.S. assembly plants, but the companies have not yet finalized their decision. Honda has one factory in Indiana and one in Alabama, as well as two in Ohio including the company's main plant.
While government officials ranging from local lawmakers to the President himself have been calling for a market-wide transition away from gas-powered vehicles, the limited supply of lithium-ion batteries has been a major hurdle for EV development and production.
Developing lithium-ion battery materials and lithium-ion battery alternatives is the primary focus of LG. Along with Honda, the energy company is also building a number of new plants with General Motors
The number of new battery plants being built in the U.S. has been rapidly increasing, representing a major shift towards EVs and away from gas-powered vehicles.
Currently, construction is either planned or underway for new battery plants from Toyota Motors
The shift towards EVs has also been seen in new legislation: in August, California introduced new regulations stating that the sale of new gas-powered vehicles will be banned in the state after 2035. The sale of used gas-powered cars will still be allowed after 2035, and there are no restrictions on the possession of traditional combustion vehicles.
However, the Biden Administration recently fumbled its efforts to encourage the transition to EVs. The Inflation Reduction Act signed by President Joe Biden on August 16 was meant to be "the biggest step forward on climate ever", but the bill also introduced new regulations on EV-tax credits that may inadvertently make it more difficult to purchase EVs.
Once the law goes into effect, 70% of EVs on the market will not qualify for the tax credit, but a "transition rule" means that some buyers may still be able to qualify if they commit to purchasing soon enough. Car companies have been encouraging customers to sign a contract of purchase rather than placing a reservation, the common practice of paying a small amount to place a non-binding order.
