Honda to integrate EV battery procurement under 2 joint ventures

Honda Motor Co. will create a trading arm in Beijing to centralize procurement of batteries for electric vehicles built at joint ventures with Dongfeng Motor Group and GAC Motor Co. 

The move is intended to improve battery procurement efficiency and ensure battery supply, Honda’s China unit said this week.

The new unit, HDG Trading Service Co., will be incorporated later this month as a 50-25-25 partnership between Honda China, Dongfeng-Honda and GAC-Honda. 

The company will procure batteries from CATL, China’s largest EV battery supplier, for the two joint ventures, Honda China said.

Dongfeng-Honda and GAC-Honda currently purchase EV batteries from CATL on their own. 

Honda this year began sales of the first two locally produced models developed on a new EV platform known as e:N Architecture F. 

Both models – the e:NS1 built at Dongfeng-Honda and the e:NP1 produced at GAC-Honda -- are compact crossovers. They have the same starting price of 175,000 yuan ($25,072) after government subsidies.

Starting with the e:NS1 and e:NP1, Honda plans to introduce ten e:N Series EV models in China by 2027. 

Honda’s China sales rebounded for the third straight month in August, surging 149 percent to 136,530 vehicles, Honda China said, without revealing details on EV deliveries.

In the first eight months, deliveries at the Japanese brand dipped 3.8 percent to 949,314 vehicles.