Honda is reportedly mulling over the construction of a £10bn ($13.83bn) electric vehicle (EV) plant in Canada, reported by Japan’s Nikkei newsgroup on Sunday.
The project might also incorporate in-house manufacturing of batteries, marking a significant step for the Japanese automaker in the electric mobility sector.
While Honda declined to comment on the report, citing an inability to disclose information at this time, the Nikkei report suggested that this undertaking could rank among Honda’s biggest financial commitments to date.
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The second-largest car manufacturer in Japan has been somewhat cautious in embracing the EV market, lagging behind its competitors.
Honda’s global sales of battery-powered vehicles constituted less than 0.5% of its overall sales, amounting to about 2.8 million cars during the initial nine months of 2023, according to company data.
According to Nikkei’s sources, the Japanese automaker is currently exploring various locations for the proposed plant, with one possibility being adjacent to an existing automobile factory in Ontario. Honda aims to finalise its decision by the end of the year, with potential groundbreaking on the new facility as early as 2028.
Honda is already set to commence production and sales of EVs in North America by 2026, based on its innovative Honda e:Architecture. In collaboration with LG Energy, the company announced in 2022 its plan to establish a $4.4bn joint-venture battery plant in Ohio.
However, in October 2023, Honda and General Motors abandoned their joint initiative to develop affordable electric vehicles, a year after their initial agreement to collaborate in a $5bn effort to challenge Tesla in sales.
Last year, Honda announced a collaboration with Taiwan Semiconductor Manufacturing Company (TSMC) to secure future supplies of chips for its vehicles following the severe shortages which have disrupted vehicle production over the last two years.
In a business update meeting in April last year, Honda announced it would be stepping up development and production of battery electric vehicles (BEVs), with plans to invest US$40bn to achieve annual sales of 2 million units globally by 2030 from very limited volume last year.
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