CATL gained another customer - Honda will buy 56 GWh in less than 7 years

CATL announced an interesting cooperation agreement with Honda Motor Co. on batteries for electric vehicles. We are wondering how Panasonic received such news.

According to the press release, CATL and Honda will jointly develop batteries for further Honda models, offered not only in China, but also in Japan and globally. As a first step, CATL will set up a local office in Utsunomiya, Japan (the location of the Honda R&D Co., Ltd., Automobile R&D Center in Tochigi) in order to provide more effective localization service support.

The major point of the deal is that CATL will guarantee supply to Honda of about 56 GWh of lithium-ion EV batteries before 2027. As there are less than 7 years by the end of 2026, on average Honda would need to purchase up to 8 GWh per year (probably less in the near-term, and more at the end of the deal), which would be enough for 160,000 cars with 50 kWh packs.

Honda's official plan from 2016 envisions that by 2030 65% of cars sold will be electrified (HEV, PHEV, and EV).

At the Beijing Motor Show in 2018, the Japanese manufacturer additionally announced more than 20 electric vehicles would be launched in China by 2025.

Currently, Honda offers in the U.S. Clarity PHEV, which became one of the most popular plug-in hybrids. Next month, the company will unveil also a small electric car for Europe.

More about cooperation agreement from CATL:

"As a top player of Japanese auto, Honda has great accumulations of traditional automotive technology and successful market experience. CATL is the leader in the EV battery industry. With its strong scientific R&D, manufacturing strengths and excellent product performance, CATL has been widely accredited by global top tier automobile companies. The cooperation between the two parties is a deep integration of the traditional automobile and electrification technology for the future. CATL enters Japanese automobile enterprise supply chain which is known as "artisan spirit" with mature and reliable EV battery solutions. CATL is going to help Honda to integrate resource advantages in the electric vehicle industry and assist Honda to accelerate electrification and seized the opportunity of the "car revolution".

In this win-win cooperation, Honda and CATL are closely engaged in technical exchanges and upgrades, they are committed to creating a clean, technological and efficient way for transportation for global consumers, and continue to create new value for the global new energy industry."

Naosumi Tada, head of CATL's Japanese subsidiary said:

"Customer-centered is the philosophy that CATL has always insisted on. We hope that we can establish more efficient communication channels, more timely response mechanisms, and establish a closer relationship for further cooperation. Honda and CATL have been worked closely on advanced and reliable battery solutions for Honda's future electric vehicle applications. In the future, we will support Honda not only in China, Japan, but also to create world-leading electric vehicles that serves global consumers."

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