By Peter Valdes-Dapena, CNN Business
Honda and South Korean battery maker LG Energy Solutions are investing $3.5 billion to build a joint venture battery factory in southern Ohio, the car company said Tuesday.
An exact location hasn’t been announced but the factory, which is expected to employ 2,200 people, will be in Fayette County, southwest of Columbus. Honda did not say how much of the $3.5 billion it would contribute. Honda already employs almost almost 11,000 people in its various manufacturing facilities in the state.
Construction on the battery plant is expected to begin early next year and should be completed by the end of 2024. Lithium-ion battery cell production is scheduled to begin at the factory about a year after construction is completed, according to Honda.
Honda and LG are ultimately expected to invest a total of $4.4 billion in the facility, Honda said in its announcement.
Honda recently revealed the design of its next electric SUV, the Honda Prologue. That SUV, as well as other upcoming electric vehicles from Honda and its Acura luxury brand, will be based on General Motors engineering and will use GM’s Ultium battery packs. But the batteries being made at the new factory in Fayette County will be specifically for Honda and will go into other future electric vehicles of Honda’s own design. These vehicles will start going on sale in 2026.
Honda will also invest another $700 million to make changes to three existing factories in Ohio to prepare them to make electric vehicles and major components for EVs. Changes will be made to Honda’s Marysville Auto Plant, East Liberty Auto Plant and Anna Engine Plant. The addition of electric vehicle production at these plants, which will also continue making combustion-powered vehicles for some time, will add about 300 jobs, according to Honda.
The changes will enable the Anna Engine Plant to produce battery cases. At the Marysville plant, battery cells from the Fayette County battery factory will be installed in the battery cases made in Anna. The completed battery packs will be put into electric vehicles built at both Marysville and East Liberty.
Honda has said it plans to sell only electric vehicles in major markets, including the United States, by 2040.
Manufacturing batteries, battery packs and electric vehicles in the United States could make the new Honda EVs eligible for tax credits under the new Inflation Reduction Act expected to go into effect beginning next year. These manufacturing and investment plans were made long before that law was passed, said Bob Nelson, executive vice president of American Honda Motor Co.
The Marysville factory opened in 1982 and was Honda’s first auto factory in the United States. Honda now has 18 factories producing Honda and Acura vehicles in the United States.
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