Business Maverick: Honda CEO Bets $40 Billion to Reach Goal of Going Fully Electric

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When Toshihiro Mibe took over as Honda Motor Co’s chief executive officer last year, he did so with a bang, promising to achieve carbon neutrality by 2050 and phase out petrol-powered car sales by 2040, becoming Japan’s first carmaker to say as much.

Mibe says partnering with Sony, a company operating in a completely different industry, is a way for Honda to create new sources of value for its cars that the company couldn’t have conceived of on its own. A major draw of its partnership with GM is the cost savings afforded by the automakers’ combined production capacity. Together “we have globally significant volume,” Mibe said, “which will have a huge impact on costs.

Honda is also looking to expand partnerships further in order to stay abreast of what Mibe sees as “constantly evolving” EV and battery technologies. In a sense, “we’re moving forward with our electrification strategy in a chaotic situation,” Mibe said. “We have to make sure our plans are flexible enough to respond to the daily progression of various technologies.”

At Tuesday’s briefing, Honda, which sources Ultium batteries from GM, said it’s exploring the possibility of creating a joint venture with another company for battery production and plans to source batteries for mini EVs in Japan from Envision AESC. Honda itself will start trial production of solid-state batteries in early 2024 and is discussions with GM about next-generation batteries as well, according to Mibe.

A benefit, Mibe says, of Honda’s existing partnerships with Sony and GM is that there are no capital ties between the companies that restrict their actions. “We’re pursuing conversations as companies that are totally free,” he said. “The partnerships will strongly tie into the competitiveness of our global EV expansion.”

 

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Honda plans $64bn investment in electric vehicles over next 10 yearsJapanese carmaker also wants to establish a dedicated EV production line in North America
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