Honda sets $3.5B battery plant for Ohio
COLUMBUS, Ohio — Honda says it will build a $3.5 billion joint-venture battery factory in rural southern Ohio and hire 2,200 people to staff it as the company starts to turn the state into its North American electric vehicle hub
Honda Motor Co. Ltd., which announced its first Ohio factory 45 years ago, also plans to invest $700 million and add 300 jobs at three of its existing Ohio factories to prepare them to start making EVs and components.
The battery plant, to be built jointly with LG Energy Solution Ltd. of South Korea, is poised to see a total investment of $4.4 billion. The plant site is off Interstate 71, about 40 miles southwest of Columbus, Ohio’s state capital.
In addition, Honda’s two assembly plants northeast of Columbus and its engine plant north of Dayton, Ohio, will share a $700 million investment. The latter will make cases to hold battery cells, while the former plants will build complete EVs.
Construction on the battery plant will start early next year, with mass production of pouch-type lithiumion cells to begin by the end of 2025, according to Honda. The plant will produce batteries exclusively for its vehicles assembled in North America, including the company’s Acura luxury brand.
Bob Nelson, Honda’s executive vice president, said at a news conference Tuesday at the Ohio Statehouse that his company has found a strong partner in the state, where five of its 12 U.S. factories are located.
“We appreciate our strong bond (with Honda)… Truly, today is a great day for Ohio.” Gov. Mike DeWine said.
Honda says it’s still working out details of an incentive package with the state for the battery plant, to be run by the joint venture that will be formed this year, Nelson said.
“We feel the resources will be good to run and operate the facility,” he told reporters. “This will give us a good chance to have an impact on the community.”
Last week Honda showed off the design of its Prologue electric SUV that will be developed on General Motors Co.’s Ultium EV platform and will go on sale in 2024. The Prologue will be a little larger than the current CR-V. Nelson wouldn’t say where the Prologue will be built.
Honda says it plans to start selling models built on its own EV underpinnings in 2026, but the company will continue to co-develop affordable EVs with GM, built by Honda. The Japanese automaker plans globally to introduce 30 new EVs by 2030, with plans to sell only zero-emission automobiles by 2040.
Company workers in Ohio have been building gas-electric hybrid vehicles for years, and that experience will help in the switch to EVs, Nelson said.
Honda’s announcement follows several waves of battery and EV assembly plant announcements in North America as automakers try to establish a domestic supply chain for the next generation of vehicle propulsion.
Ford Motor Co., GM, Toyota Motor Corp., Hyundai Motor Co., Stellantis NV and Vietnam’s VinFast have announced plans for a combined 10 new U.S. battery plants, many with joint-venture companies.
In addition, Ford, GM, Hyundai and VinFast have announced plans to build new EV assembly plants in the U.S., or to retool existing plants to handle EV production.
The newly passed Inflation Reduction Act gives manufacturers even more incentive to build batteries in North America. The law includes a tax credit of up to $7,500 to defray the cost of purchasing an EV. But to qualify for the full credit, an EV must contain a battery built in North America, with 40% of the metals mined or recycled on the continent.
Nelson said Honda has been planning its battery and plant investments for years, well ahead of the law’s August passage.
EV sales are expected to rise dramatically between now and 2030 in the U.S. and globally, but even at the start of the next decade, they will be just over one-third of U.S. new vehicle sales.
LMC Automotive, a consulting firm, says it expects EVs to be 5.6% of U.S. sales this year, rising to 13.5% of the market by 2025 and 36.4% by 2030.