Honda to establish a joint venture with CATL in China for enhanced battery production efficiency
In a significant move towards electrification, Japanese auto giant Honda, along with Chinese automakers Dongfeng Motor and Guangzhou Automobile Group (GAC), have established a new joint venture for electric vehicle (EV) battery procurement in China. The joint venture, HDG (Beijing) Trading Service Co Ltd, is set to commence operations by the end of September.
The new company will handle battery procurement for Honda's two existing joint ventures in China, Dongfeng Honda and GAC Honda, aiming to enhance efficiency and facilitate Honda's access to EV battery supplies in China. Previously, these two joint ventures sourced batteries separately from CATL.
The strategic partnership between Honda and CATL is based on a strategic cooperation agreement signed in 2020, covering areas including joint development, supply, recycling, and reuse of power batteries. Honda China has also signed a strategic cooperation memorandum with CATL to build a long-term stable power battery supply relationship.
The joint venture will further strengthen the strategic partnership between Honda and CATL to secure battery supply for Honda's expansion of its e:N brand pure electric vehicle product lineup. Honda plans to launch 10 e:N brand pure electric vehicles to China by 2027.
Notably, the joint venture's establishment follows the successful launches of Honda's first pure electric vehicle models in China. On April 27, 2023, Dongfeng Honda's e:NS1 was officially launched, marking Honda's first pure electric vehicle model in China. On June 20, GAC Honda's first EV model, the e:NP1, was officially launched.
As part of their push for electrification, both GAC Honda and Dongfeng Honda are undertaking the construction of new EV plants. The new joint venture is aimed at supporting these efforts and accelerating the push for electrification in China.
However, further details about the terms of the agreement or the specific batteries to be procured were not disclosed in the press release. The joint venture will cooperate in areas such as intensive production and battery recycling based on CATL's Yichun plant in Jiangxi province.
This joint venture marks another step in Honda's commitment to China, a market where it has been active with various joint ventures, including those with Dongfeng and GAC for manufacturing vehicles. Honda has unveiled five EV models in China, demonstrating its significant push for electrification in the country. Honda China will hold a 50% stake, while Dongfeng and GAC each hold a 25% stake in the new joint venture.
- Honda China, Dongfeng Motor, and Guangzhou Automobile Group (GAC) have established a new joint venture, HDG (Beijing) Trading Service Co Ltd, to handle battery procurement for Honda's two existing joint ventures in China, aiming to boost efficiency and facilitate access to EV battery supplies in China.
- The joint venture will further strengthen the strategic partnership between Honda and CATL, which is based on a strategic cooperation agreement signed in 2020, focusing on the joint development, supply, recycling, and reuse of power batteries.
- Honda plans to launch 10 e:N brand pure electric vehicles to China by 2027, and the joint venture will secure battery supply for Honda's expansion of this product lineup.
- Along with the establishment of the joint venture, both GAC Honda and Dongfeng Honda are constructing new EV plants, with the joint venture aimed at supporting these efforts and accelerating the push for electrification in China.
