Honda signs battery supply deal with CATL in China

Honda has signed a supply contract with CATL to provide batteries for electric cars in China with a total volume of 123 gigawatt-hours over a period of seven years. First deliveries are planned for 2024.

CATL is to supply Honda with batteries for its e:N range of electric cars from 2024 to 2030 from its factory in Yichun in Jiangxi province, which is still under construction. The Japanese vehicle manufacturer does not disclose the order value or the battery cell specifications. Unsurprisingly, Honda has chosen CATL as its battery supplier in China. Already in the summer, the company made public that it would set up a joint venture with its Chinese partners Dongfeng and GAC to bundle the purchase of electric vehicle batteries from CATL.

According to Honda, HDG Beijing Trading Service (Chinese title: Zhongrui Beijing Trade Service) was established in November 2022. The joint venture will be headquartered in Beijing. Honda holds 50 per cent, the two Chinese partners 25 per cent each in the start-up. In the summer, the Japanese company had said they wanted to “establish a long-term, stable supply relationship for batteries” with CATL. In addition, there is to be cooperation in production and battery recycling at the CATL plant in Yichun.

The two companies already know each other well: a first comprehensive battery cooperation agreement dates back to mid-2020, when Honda and the Chinese battery maker entered into a partnership to develop batteries, discuss recycling and second-life approaches, and explore a distribution system. The Japanese carmaker also acquired a one per cent stake in CATL then.

A secure supply of batteries is essential for Honda insofar as the Japanese company, together with their Chinese partners, launched an electrification offensive in China last autumn under the new e:N brand. As the first representative of the new series, the e:NS1 from Dongfeng Honda celebrated its premiere in China at the end of April 2022. This was followed in June by the market launch of the e:NP1 from GAC Honda. In principle, Honda plans to bring ten e-models to market by 2027 through its joint ventures with GAC and Dongfeng. Against this background, several new plants are currently being built in the country – among others in Guangzhou and Wuhan.

cnevpost.com, honda.co.jp (in Japanese)