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Honda inks 7-year EV battery supply deal with China’s CATL
Published on: Friday, December 09, 2022
By:
Nikkei, FMT
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Honda plans to roll out 10 EV models under the e:N brand in China by 2027. (Honda pic)
CATL, the world’s largest producer of EV batteries, will supply them to one of Honda’s Chinese joint ventures from 2024 to 2030. The value of the deal was not disclosed.
The contract took effect Tuesday, the Chinese company said in a separate announcement. The batteries will be made at a factory that CATL is building in Yichun, a city in China’s Jiangxi province.
“CATL and Honda will leverage their respective advantages and sharpen their competitive edge,” CATL said in Thursday’s statement.
Honda will receive 123 gigawatt-hours’ worth of batteries from CATL. This is enough for 1.23 million to 1.76 million electric vehicles, as most EVs carry batteries with a capacity worth 70 to 100 kilowatt-hours.
The Japanese automaker last month formed a battery procurement company, HDG (Beijing) Trading Service, together with existing Chinese joint ventures Dongfeng Honda Automobile and GAC Honda Automobile. CATL’s batteries will come through this unit.
CATL has previously supplied batteries to Honda in China. Back in 2020, Honda invested 3.7 billion yuan (US$530 million) in the Chinese manufacturer.
Honda said this latest deal with CATL is part of efforts to secure a steady supply of batteries to support an expansion of electric vehicle sales in China.
In China, Honda launched the EV brand dubbed the e:N series. Since April, the Japanese automaker has released two EV models in the market, with plans to roll out a total of 10 models through 2027.
Honda is constructing EV assembly plants in Guangzhou and Wuhan, both slated to be operating in 2024. The company looks to sell 800,000 EVs in the Chinese market in 2030, up from 10,000 last year.
