The establishment of a joint venture firm to manufacture lithium-ion EV batteries in the US will take place in 2022, according to a joint announcement from Honda and LG Energy Solution.

The joint project battery plant is projected to achieve an annual manufacturing capacity of about 40 GWh of cells. The two businesses are planning to invest a sum of $4.4 billion in it. That equals to over 400,000 batteries with a 100 kWh capacity apiece.

Future electric car versions from Honda and Acura for the NA market will only use the JV’s batteries. Although the precise location of the new gigafactory has not yet been determined, it is unknown when mass production will begin (most probably early 2023) and when building will begin (at long last 2025).

Honda Will Hold a 49% And LG Energy Solution Will Have a 51% Stake

Honda disclosed in a statement that it will contribute $1.7 billion for a 49% part in the JV. 51% of the stock will belong to LG Energy Solution. 70,000 units are the original yearly sales target. According to the timeframe, batteries for the Honda/Acura upcoming EVs, depending on the company’s own proposal named “e:Architecture,” are expected to be supplied by the forthcoming battery joint venture with in 2nd quarter of the 2020.

Honda intended to build 800,000 electrified vehicles yearly in North America by 2030. The figure is anticipated to reach closer to 2 million worldwide with a total of 30 BEV models.