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Honda EV Battery Venture Draws More Funding

Feb. 8, 2023
A $3.5-billion start-up that will mass-produce lithium-ion batteries for Honda’s North American vehicle output is due for another $237 million from Ohio’s economic development agency.

Honda Motor Co. and LG Energy Solution have drawn $237 million more in assistance for their joint-venture EV battery plant announced in January and scheduled to begin development soon southwest of Columbus, Ohio. In addition to the new plant, one of the grants will provide $87 million to Honda for retooling its Ohio automotive plants for electric vehicle production.

The three grants from JobsOhio, an economic development agency, will be paid over 10 years. Along with the aid for Honda’s retooling, the largest of the three grants is worth $140 million for economic development at L-H Battery Co., the new manufacturing business. A $10-million grant will cover workforce development.

The state previously pledged $156.3 million in tax incentives and infrastructure improvements for the L-H Battery project.

“LG Energy Solution has all the right assets to make this joint venture a success, including the financial stability, quality, competitiveness, and production capacity with global operational expertise,” L-H Battery CEO Robert H. Lee stated in January. “With two companies’ expertise combined, we will provide top quality batteries to ensure the successful launch of Honda EVs in North America, and grow with the community here in Ohio by creating high value jobs.”

Honda operates two vehicle assembly plants in Ohio, at Marysville (Honda Accord Sedan and Coupe, and Acura TLX and ILX) and East Liberty (Acura RDX); and an engine casting and manufacturing operation (four-cylinder, V-6 and turbo engines) at Anna, Ohio.

In January Honda (49%) and LG (51%) announced their plan for L-H Battery Co. to mass produce advanced lithium-ion cells by the end of 2025, with an estimated annual capacity of 40 Gwh. All the batteries to be produced will be supplied exclusively to Honda’s North American plants, for battery-electric vehicles to be sold in the U.S. and Canada.

The partners committed to invest $3.5 billion in the project, though their overall investment is projected to reach $4.4 billion.

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