Honda and GS Yuasa entered a basic agreement to construct a battery cell factory in Japan, along with the establishment of a new joint venture.

Honda and GS Yuasa have reached a basic agreement to form a joint venture and construct a battery factory in Japan with a target annual capacity of 20GWh. The new joint venture is planned to be established by the end of 2023, covering a wide range of EV battery operations, including research and development, and planning for products. An investment of ¥400Bn (US$2.99Bn) has been assigned for the new battery facility, with initial production scheduled for 2027. Cells produced at the proposed facility will be used domestically in Japan for energy storage and electric vehicle applications. Further details regarding the factory are expected to be completed alongside the establishment of the new joint venture.

Honda and GS Yuasa previously established a joint venture in 2009: Blue Energy, responsible for developing and producing hybrid batteries for Honda and Toyota Motor. GS Yuasa owns 51% of the company and Honda the remaining 49%.

The announcement by Honda and GS Yuasa forms part of a wider trend within Japan, which has been supported by government assistance targeting the battery industry. Honda and GS Yuasa will receive ¥158.7Bn (US$1.17Bn) from the Japanese government in subsidies. In total, the Japanese government has designated ¥184.6Bn (US$1.38Bn) in subsidies for eight Energy Storage System (ESS) related proposals and up to ¥56.4Bn (US$410M) for two semiconductor-related projects.