LG Energy, Honda to form JV for EV battery production in the US

LG Energy Solution Ltd. announced on Monday that it reached an agreement with Honda Motor Co. to establish a joint venture company to produce lithium-ion batteries in the United States to power Honda and Acura EV models for the North American market.

Under the agreement, LG Energy and Honda will inject $4.4 billion into the joint venture to establish a new plant in the US, with an annual production capacity of about 40 GWh. 

LG Energy will have a 51% stake in the joint venture, while Honda will have a 49% stake. 

The pouch-type batteries produced at the new factory will be supplied exclusively to Honda facilities in the target region. 

While the location for the new plant is yet to be finalized, the two companies aim to begin construction early next year to start mass producing advanced lithium-ion battery cells by the end of 2025.

"Our joint venture with Honda, which has a significant brand reputation, is yet another milestone in our mid- to long-term strategy of promoting electrification in the fast-growing North American market," said Kwon Young-soo, CEO of LG Energy Solution. 

"Honda is working toward our target to realize carbon neutrality for all products and corporate activities the company is involved in by 2050," Toshihiro Mibe, President and CEO of Honda Motor Co. said. “This initiative in the US with LG Energy Solution, the leading global battery manufacturer, will be part of such a Honda approach."

The joint effort follows the Inflation Reduction Act signed into law by US President Joe Biden on Aug. 19, which includes a key provision meant to spur growth in the electric vehicle market. 


Write to Han-Shin Park at phs@hankyung.com
Jee Abbey Lee edited this article.