Honda To Invest $40 Billion In Electrification And Launch 30 EVs By 2030

Honda has a grand plan. By 2030, it proposes to launch 30 new electric vehicles as it invests 5 trillion yen ($40 billion) into the development of EVs over the next decade.

The firm also announced it will spend around 8 trillion yen (@ $62.5 billion) in total on research and development over that time period. For the record, just to give you and idea of the firm’s cash flow, the annual sales of Honda’s top three models—CR-V, Civic and Accord—total around $22.5 billion from combined sales of around 68,000 units per month.

Having recently announced a collaboration on reasonably-priced EVs with GM, the Japanese firm says its plans to shift away from conventional gasoline and diesel cars and become a carmaker that only offers electric or fuel cell vehicles by 2040.

In a recent briefing on electrification of the company, Honda President Toshihiro Mibe commented, “We will develop high-value products on a global scale, and EVs are a big part of that plan.”

Mibe initially said in April 2021 that the company would withdrawal from gasoline-powered vehicles by 2040, and at this press conference, he gave some clear ideas how Honda would achieve that goal.

Honda’s R&D spending over the past decade amounted to approximately 7 trillion yen (@$54.7b), which means that this investment will be boosted by over 10%. According to Mibe, some 60% of R&D expenditures will be channeled into developing EVs and appropriate software.

Honda also revealed its global battery strategy by region. At the outset, the company will focus on securing stable supplies of liquid lithium-ion batteries in North America, China and Japan by reinforcing its current partnerships. One example in the U.S. market is that Honda will source Altium batteries from General Motors and is also contemplating partnering with another battery company.

Honda plans to introduce 30 EV models by 2030 globally, and expect to produce over 2 million units yearly. To start the ball rolling in North America, two joint GM-Honda developed mid-sized and large EVs will debut in 2024. In China however, a market that accounts for 40% of the firm’s annual global sales, 10 models will be rolled out by 2027.

Mibe also confirmed that like Tesla and other EVs, software updates over the internet will become commonplace in Honda’s EVs as well.

Meanwhile, rival automakers in Japan are also strengthening their EV strategies with Toyota announcing recently that it plans to invest 8 trillion yen in electric and hybrid vehicles by 2030, while Nissan will invest 2 trillion yen to develop EVs up until the end of 2026.

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