Japan’s Honda Motor Co Ltd plans to spend $64 billion on research and development over the next decade. This has laid out an ambitious target to roll out 30 electric vehicle models globally by 2030. Its goals include producing some 2 million electric vehicles a year by 2030, aiming to gain share in the fast-growing market for electric vehicles. This is led by Tesla Inc, while Japanese automakers risk falling behind European and U.S. rivals.
Honda Chief Executive Toshihiro Mibe, referring to the equivalent to $64 billion that as far as resource investments over the next 10 years ago, they are going to invest about 8 trillion yen in research and development expenses. Honda said that it wanted to establish a dedicated electric vehicle production line in North America, where it will also procure Ultium batteries from General Motors Co.
It is also considering a separate joint venture company for battery production there. Honda said that it and GM would develop a series of lower-priced electric vehicles based on a new joint platform, expanding on plans for GM to begin building two electric SUVs for Honda starting in 2024. The push towards electric vehicles has prompted it to hunt for partners to optimise costs and share technology. Christopher Richter, an analyst at CLSA said that this puts them in good company with a lot of other makers that have made big battery announcements. Ultimately the world is going to leave internal combustion engines behind.
The bulk of the 8-trillion-yen investment is earmarked for electrification and software technologies. That includes about 43 billion yen on a demonstration line for production of solid-state batteries, targeted to start in spring 2024. Honda and other Japanese automakers have long said that even as they go electric, they will not give up on older, hybrid technology. Proponents of hybrids point to the many markets, where the infrastructure to support battery electric vehicles will be a long time coming.
Mibe told that by no means is this the end of hybrids and the replacement of all hybrids with EVs. They will develop their current hybrids and use them as a weapon in their business. Honda’s plan to make 2 million EVs annually was within expectations. This is because Toyota Motor Corp has already targeted sales of 3.5 million such vehicles by 2030 and Nissan Motor Co has aims for half its cars to be electric by the end of the decade. Honda boss Mibe has already made a number of bold pronouncements, within a year into the job.
The company said that it would team with Sony Corp to develop and sell electric vehicles, aiming to start selling the first model in 2025. Last year he unveiled a 2040 target for electric and fuel cell vehicles to make up all of global sales. Shares of Honda finished down 0.2%, outperforming the Nikkei 225 index, which fell 1.8%.