Canada

Honda Motor announced on April 25 that it has reached a basic agreement with South Korea’s POSCO Future M on the production of cathode materials for automotive batteries in Canada. The two companies will begin discussions toward the establishment of a joint venture company which will produce cathode materials for batteries for electric vehicles (EVs) Honda will produce and sell in North America before the end of 2024.

・Based on discussion of a comprehensive partnership toward the realization of carbon neutrality which began in April 2023, the two companies had been considering the possibility of cooperating in the procurement of key battery materials, which resulted in this basic agreement. The purpose of this basic agreement is to steadily execute respective electrification strategies by ensuring steady procurement of high-performance batteries in the North American electrification market, where mid- to long-term growth is expected.

・The two companies will share each other’s strengths, such as high value-added material technologies and electrification technologies, to produce high-quality cathode materials to be utilized for EV batteries. This will enable the realization of high-performance EVs, which will lead to the acceleration of respective initiatives toward carbon neutrality.

Based on Honda press release

On April 25, Honda announced that it plans to build a comprehensive EV value chain in Canada with an approximate investment of CAD 15 billion, including investment by joint venture partners, to strengthen its EV supply system and capability to prepare for a future increase in EV demand in North America.

Honda is also in discussions with the governments of Canada and Ontario to receive incentives. Honda has begun the process of evaluating the scope of its investment. This work is expected to be finalized during the next six months and more details will be shared at that time.

As a part of establishing a comprehensive EV value chain, Honda will build EV plant and EV battery plant in Alliston, Ontario. The EV plant will begin operation in 2028 and have a production capacity of 240,000 EVs per year. The EV battery plant will have a capacity of 36 GWh per year.

In addition to securing the current employment level of 4,200 associates at its two existing manufacturing facilities in Ontario, Honda estimates it will add a minimum of 1,000 new associates for the EV and EV battery manufacturing facilities.

The proposed Honda EV value chain will also include a cathode active material and precursor (CAM/pCAM) processing plant through a joint venture partnership with POSCO Future M Co., Ltd.  and a separator plant through a joint venture partnership with Asahi Kasei Corporation, with announcements to follow in their respective Ontario communities.

Striving to realize carbon neutrality for all its products and corporate activities by 2050, Honda has set a goal to make BEVs and FCEVs represent 100% of vehicle sales by 2040.

(Honda press release on April 25, 2024)

On April 25, Asahi Kasei announced that it will construct an integrated plant in Ontario, Canada for the base film manufacturing and coating of Hipore wet-process lithium-ion battery (LIB) separator.

At the first phase, the new plant will to have production capacity of approximately 700 million square-meter per year (as coated film) with the commercial start-up scheduled in 2027. Total investment will be approximately JPY 180 billion. In addition to joint investment by the Development Bank of Japan (JPY 28 billion) and Honda Motor, financial support will be received from the federal government of Canada and the provincial government of Ontario, allowing Asahi Kasei to attain adequate production scale in accordance with market expansion while controlling investment risk.

As medium- to long-term growth is forecasted in the North American xEV market, phase 2 and phase 3 investments are anticipated. Through phase 3 investment, North American market share of 30% or more is targeted. In 2031, the fifth year of the Canada plant's operation, Hipore global sales are expected to be JPY 160 billion with an operating margin of 20% or above.

Asahi Kasei press release and presentation