Honda to invest $40B over 10 years in electrification and software; launching 30 EV models by 2030; > 2M units p.a.
In a press briefing held in Tokyo on its initiatives in automobile electrification, Honda announced that it will spend approximately ¥5 trillion (US$40 billion) in the area of electrification and software technologies to further accelerate its electrification over the next 10 years, including both R&D expenses (¥3.5 trillion / US$28 billion) and separate investments (¥1.5 trillion / US$12 billion).
Additionally, Honda announced plans to launch 30 EV models globally by 2030, with a production volume of more than 2 million units annually. Honda’s overall R&D expenses budgeted for this period will be approximately ¥8 trillion (US$64 billion).
As the world’s largest power unit manufacturer with annual sales of approximately 30 million units of mobility products including motorcycles, automobiles, power products, outboard motors and aircraft, Honda says that it aims to realize carbon neutrality for all products and corporate activities Honda is involved in by 2050. To this end, Honda believes that a multifaceted and multidimensional approach is needed, not a mere replacing of engines with batteries.
Including the utilization of swappable batteries and hydrogen as well as electrification of automobiles, Honda will offer a variety of solutions for all of its mobility products according to how its customers use the products in various countries and regions.
In the past, Honda divided its organization by products, namely motorcycle, automobile and power products. However, starting this fiscal year, technology areas which will become the core of the future competitiveness of Honda have been moved from their respective product-based organizations and combined under the newly created Business Development Operations. Such core areas are: electrified products and services, battery, energy, Mobile Power Pack, hydrogen and software/connected technologies that connect all core areas.
Batteries. Honda notes that the key challenge in the EV era is the global procurement of batteries. Honda has two basic approaches for its battery procurement strategy. Now and for the time being, Honda will ensure stable procurement of liquid lithium-ion batteries in each region by strengthening external partnerships.
In North America, Honda will procure Ultium batteries from GM. Separately, aside from GM, Honda is exploring the possibility of creating a joint venture company for battery production.
In China, Honda will further strengthen its collaboration with CATL.
In Japan, Honda will procure batteries for mini-EVs from Envision AESC.
From the second half of the 2020s, Honda will further accelerate its independent research and development of next-generation batteries. For the all-solid-state batteries it currently has under development, Honda decided to build a demonstration line, investing approximately ¥43 billion (US$343 million), with a goal to make it operational in Spring 2024. Honda aims to adopt its next-generation batteries to models to be introduced to the market in the second half of the 2020s.
Introduction of EVs. From now through the second half of the 2020s, Honda will introduce products tailored to the market characteristics of each region.
For North America, in 2024, Honda will introduce two mid- to large-size EV models currently being developed jointly with GM. (Honda brand: All-new Prologue SUV, Acura brand: an EV SUV model.)
For China, Honda will introduce a total of 10 new EV models by 2027.
For Japan, in early 2024, Honda will first introduce a commercial-use mini-EV model at the ¥1-million (US$8,000) price range. Then, Honda is planning to make the timely introduction of personal-use mini-EVs and EV SUVs.
After the second half of the 2020s—assuming it will become the time of the mass adoption of EVs—Honda will begin introducing the best EVs from a global perspective.
In 2026, Honda will begin adopting Honda e: Architecture, an EV platform that combines the hardware platform and software platform.
Through the alliance with GM, Honda is planning to introduce affordable EVs in 2027, with a cost and range that will be as competitive as gasoline-powered vehicles, starting from North America.
Through these initiatives Honda is planning to launch 30 EV models globally by 2030, with a full lineup from commercial-use mini-EVs to flagship-class models, and Honda is planning for production volume of more than 2 million units annually.
As for EV production operations, in China, Honda is planning to build a dedicated EV plant in Guangzhou as well as Wuhan. Honda is planning for a dedicated EV production line also in North America.
Connected / software technologies. The key to achieve connectivity is the technologies and frameworks, where Honda positions its electrified products as “terminals” and connects energy and information stored in each product with its users and society. Therefore, Honda will work on the establishment of the cross-domain connected platform, which will create new value for its customers.
In the areas of electrification technologies, including batteries, as well as software and connected technologies, for the acceleration of its development efforts, Honda will strive for a significant enhancement of development capabilities, which will include the strengthening of its human resource recruiting from outside Honda.
Sports models. While taking on the challenges of carbon neutrality and electrification, Honda always has a passion to offer fun for its customers. The “joy of driving” will be passed on to Honda models even in the era of electrification, and Honda will globally introduce two sports models—a specialty and a flagship model—which will embody Honda’s universal sports mindset and distinctive characteristics.